Wuba Lem

MATERIALS FOR EXIT EXAM 2023 (2015 E.
C) OF GaDS
The 15 Selectede Courses of the Department of Governance and

Development Studies were compiled in a single document
Contributed by All Universities Concerned
Re-compiled by: Exam Developers
The Rationale to re-compiling in a single document:
 Reducing the confussins over identifying the materials prepared by

different universities and tutorial teachers as well.
 Making easier to print out (if needed) particularly for those who
may have no access to electronic divicies.
 Enabling students to concentrate on a single and inclusive material
in very manageable and conducive way.
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Table of Contents Pages
COURSE 1: POPULATION AND DEVELOPMENT ...................................................................... 8
Unit One .......................................................................................................................................... 8
Cocepts of Population Studies......................................................................................................... 8
chapter Two Impact of Rapid Population Growth on Socio Economic Development ................. 16
chapter Three ............................................................................................................................... 23
Population Polcies ......................................................................................................................... 23
chapter Four................................................................................................................................... 33
Sustainable Development And Natural Resource In Ethiopia ...................................................... 33
COURSE 2: GENDER AND DEVELOPMENT ............................................................................. 41

Unit One ........................................................................................................................................ 41
Gender And Developmnet: An Introduction ................................................................................. 41
Unit Two ....................................................................................................................................... 46
Key Concepts And Issues In Gender And Development .............................................................. 46
Unit Three ..................................................................................................................................... 58
Feminism, Feminist Theories And Development ......................................................................... 58
Unit Four ....................................................................................................................................... 68
Approaches And Strategies In Gender And Development............................................................ 68
Chapter Six .................................................................................................................................... 72
Conceptual Overview .................................................................................................................... 72
COURSE 3: REGIONAL GROWTH AND LOCAL DEVELOPMENT ....................................... 86

Unit One ........................................................................................................................................ 86
An Overview of Some Conceptual Foundations ........................................................................... 86
Unit Two ....................................................................................................................................... 91
Some Basic Questions on Regional Growth and Development .................................................... 91
Unit Three ................................................................................................................................... 103
Theories of Regional Growth and Development......................................................................... 103
Unit Four ..................................................................................................................................... 125
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Policies and Strategies of Regional and Local Development ..................................................... 125
Unit Five...................................................................................................................................... 139
Local Economic Development .................................................................................................... 139
COURSE 4: CONFLICT MANAGEMENT AND PEACE BUILDING....................................... 153

Chapter One................................................................................................................................. 153
General Overview of Conflict ..................................................................................................... 153
Chapter Two ................................................................................................................................ 166
Conflict Analysis ......................................................................................................................... 166
Chapter Thee ............................................................................................................................... 182
Conflict Resolution Mechanisms (CRs) ...................................................................................... 182
Chapter four................................................................................................................................. 193
The concept of Peace and peace building ................................................................................... 193
Chapter five ................................................................................................................................. 199
Indigenous Conflict Resolution Mechanisms: Essence, Features and Limitations ..................... 199
COURSE 5: INTERNATIONAL RELATION AND ORGANIZATION ..................................... 205

Chapter One................................................................................................................................. 205
Basic Concepts, Evolution and Actors of International Relations .............................................. 205
Chapter Two ................................................................................................................................ 224
Theories of International Relations ............................................................................................. 224
Chapter Three .............................................................................................................................. 243
Understanding National Interest, Foreign Policy and Diplomacy .............................................. 243
Chapter Four................................................................................................................................ 254
Levels of Analysis in International Relations ............................................................................. 254
Chapter Five ................................................................................................................................ 262
International Organizations ......................................................................................................... 262
COURSE 6: POLITICAL SYSTEMS AND GOVERNANCE IN ETHIOPIAN .......................... 267
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Chapter One................................................................................................................................. 267
Introduction ................................................................................................................................. 267
Chapter Two ................................................................................................................................ 281
The Problematic Of Political Power............................................................................................ 281
Chapter Three .............................................................................................................................. 297
The Emergence Of The Modern Bureaucratic State ................................................................... 297
Chapter Four................................................................................................................................ 310
The 1974 Ethiopian Revolution .................................................................................................. 310
Chapter Five ................................................................................................................................ 337
Post Derg Ethiopia: Eprdf ........................................................................................................... 337
COURSE 7: INTRODUCTION TO POLITICS AND GOVERNMENT ...................................... 362

UNIT ONE .................................................................................................................................. 362
Definition of Basic Concepts ...................................................................................................... 362
Unit Two ..................................................................................................................................... 376
State and Society ......................................................................................................................... 376
Unit Three ................................................................................................................................... 394
Government ................................................................................................................................. 394
Unit Four ..................................................................................................................................... 406
Constitution and Constitutionalism ............................................................................................. 406
Unit Five...................................................................................................................................... 409
Political participation and Democratic Governance.................................................................... 409
Unit Six ....................................................................................................................................... 443
Contemporary Issues: Good Governance, Rule of law and the Question of Development ........ 443
COURSE 8: POLITICAL THOUGHT II ....................................................................................... 453

Unit One: ..................................................................................................................................... 453
Machiavelli‘s Political Realism .................................................................................................. 453
Unit Two: .................................................................................................................................... 461
Social Contract Theory................................................................................................................ 461
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Unit Three ................................................................................................................................... 489
Utilitarianism............................................................................................................................... 489
Unit Four ..................................................................................................................................... 495
Emmanuel Kant and the Birth of Idealism .................................................................................. 495
Chapter Five ................................................................................................................................ 498
Socialism, Marxism-Communism............................................................................................... 498
Unit Six ....................................................................................................................................... 512
Anarchism ................................................................................................................................... 512
Unit Seven ................................................................................................................................... 518
Fascism and Nazism .................................................................................................................... 518
Unit Eight .................................................................................................................................... 524
Contemporary Political Thought ................................................................................................. 524
COURSE 9: PUBLIC POLICY MAKING AND ANALYSIS ...................................................... 536

Unit One: ..................................................................................................................................... 536
Concepts of Public and Policy .................................................................................................... 536
Chapter Two ................................................................................................................................ 547
Policy Analysis ............................................................................................................................ 547
Chapter Three .............................................................................................................................. 552
Models for Policy Analysis ......................................................................................................... 552
Chapter Five ................................................................................................................................ 569
The Process of Public Policy Making ......................................................................................... 569
Chapter Six .................................................................................................................................. 578
Policy change and continuity ...................................................................................................... 578
Chapter Seven ............................................................................................................................. 584
Globalization of National Policy Making: An International Perspective ................................... 584
Chapter 8 ..................................................................................................................................... 592
An Overview of Public Policy Making in Ethiopia .................................................................... 592
COURSE 10: THEORIES AND PRACTICES OF GOVERNANCE ........................................... 635

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Chapter One Conceptualization of Governance .......................................................................... 635
Chapter Two Good-governance: A development Perspective .................................................... 688
Chapter Three Theories of Governance ...................................................................................... 709
Chapter Four................................................................................................................................ 727
Models of Governance ................................................................................................................ 727
COURSE 11: GOVERNANCE AND INSTITUTIONAL REFORM............................................ 770

Chapter One................................................................................................................................. 770
Governance, Institutions And Institutional Reforms................................................................... 770
Section Two: Understanding The Public Sector ........................................................................... 17
Chapter Two .................................................................................................................................. 31
Waves Of Institutional Reforms .................................................................................................... 31
Chapter Four.................................................................................................................................. 63
The Dynamics of Public Sector Institutional Reforms ................................................................. 63
Unit Five...................................................................................................................................... 102
Governance and Capacity Building Reforms .............................................................................. 102
COURSE 12: INTRODUCTION TO PUBLIC ADMINISTRATION .......................................... 121

Chapter One................................................................................................................................. 121
Meaning and Scope of Public Administration ............................................................................ 121
Chapter Two ................................................................................................................................ 174
Administrative Thoughts (Organizational Theories) .................................................................. 174
Chapter Three .............................................................................................................................. 187
Development Administration: Concept and Approaches ............................................................ 187
Chapter Four.................................................................................................................................. 22
New Public Administration/ Management (/Npa/Npm) ............................................................... 22
Chapter Five: ................................................................................................................................. 47
The Ethics of Public Service/Ethics in Public Sector ................................................................... 47
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COURSE 13: HUMAN RIGHTS AND HUMANITARIAN ........................................................... 57
Chapter One................................................................................................................................... 57
Conceptual and Theoretical Understanding of Human Rights...................................................... 57
Chapter Two .................................................................................................................................. 64
Classification, Basic Features Of Human Rights and States‘ Obligations .................................... 64
Chapter Three: ............................................................................................................................... 80
The Human Rights System............................................................................................................ 80
Chapter Four.................................................................................................................................. 99
The Meaning and Foundations of Humanitarian Assistance ........................................................ 99
Chapter Five: ............................................................................................................................... 125
Actors in Humanitarian Assistance ............................................................................................. 125
COURSE 14: DEVELOPMENT THEORIES AND PRACTICES................................................ 139

Unit One ...................................................................................................................................... 139
Development: An Introduction.................................................................................................... 139
Unit Two ..................................................................................................................................... 151
Theories of Development and Underdevelopment...................................................................... 151
Unit Three ................................................................................................................................... 185
Models/Strategies of Economic Growth ..................................................................................... 185
Unit Four ..................................................................................................................................... 201
Population Growth and Economic Development ........................................................................ 201
COURSE 15: INTERNATIONAL POLITICAL ECONOMY (IPE) ............................................. 217

Unit One ...................................................................................................................................... 217
What Is International Political Economy (Ipe)? .......................................................................... 217
Unit Two Theories of International Political Economy .............................................................. 280
Unit Three The Trading System .................................................................................................. 330
Unit Four ..................................................................................................................................... 352
The International Monetary System and the International Financial System ............................. 352
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COURSE 1: POPULATION AND DEVELOPMENT
Unit One
Cocepts of Population Studies
1.1. Demography versus Population Studies

Demography is the systematic and scientific study of human populations. The word demography
comes from the Greek words δημoσ (demos) for population and γραφια (graphia) for ―description‖
or ―writing,‖ thus the phrase, ―writings about populations.‖ The term demography is believed to
have first been used in 1855 by the Belgian statistician Achille Guillard in his book Elements of
Human Statistics or Comparative Demography. There is fair agreement among demographers
about the objectives and definition of demography.
Demography is the scientific study of human population. It focuses on five aspects of human
population: (1) size, (2) distribution, (3) composition, (4) population dynamics, and (5)
socioeconomic determinants and consequences of population change.
The boundaries of demography are fuzzy. There is, however, general agreement that the
discipline has a core, variously referred to as demographic analysis or formal demography, which
is concerned with the measurement of population phenomena, and a broader interpretative
omponent, often termed population studies, seeks to understand and explain the patterns,
differentials and tre nds revealed by demographic analysis and to assess their implications and
linkages to other phenomena. Population studies tend to focus on relationships between
demographic and non-demographic variables, and to the extent that demographers‘ views as to the
scope of their discipline vary, they vary largely in their perceptions of the breadth of the field of
population studies.
The study of population is multidisciplinary in nature, involving an understanding of
biology, genetics, mathematics, statistics, economics, sociology, cultural
anthropology, psychology, politics, geography, medicine, public health, ecology, etc.
1.2. Development Studies and Population Studies
Development Studies and Population studies were not traditionally seen as mainstream academic
disciplines. At this time, however, they have their own professional associations, nationally and
globally, and also have their own core of methods and materials. This section, therefore, focuses on
the overview of these two disciplines and their relationship.
1.2.1. The growth of Development Studies
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Dear learner, you have learned about development in different courses particularly in Development
Theories and Practice course. However, in this section we will see an overview of development
studies.
Development Studies as a separate branch of economics in the first instance only emerged after the
Second World War with the creation of the UN and the Bretton Woods institutions, the
International Monetary Fund and the World Bank, in 1945.
During the periods of 1940s, 1950s and 1960s, the need for development became mixed up with the
standoff between the capitalist West and the communist Soviet Union and its satellites in Eastern
Europe and China. Development in the Western world and by the international agencies was
largely seen in term of Western capitalist development, with a linear development model that saw
the rich Western nations, the First World, as leaders and the new nations, the Third World, as
lagging cases that needed to emulate the Western experience, thus bypassing the socialist
experience of the Second World. The most celebrated linear model of development of that early
Cold War period was that of the American economic historian, Walt W. Rostow (1960), whose
highly influential text, The Stages of Economic Growth, had a most telling subtitle, A
Noncommunist Manifesto.
By the 1960s and 1970s, however, academic discourse had taken a more critical stance and
integrated the work of the Dependencista School of political economy. It was led by the Chilean
economist Andre Gunder Frank. It emphasized on the nature of underdevelopment as an active
process generating and accentuating international disparities that had their origins in patterns of
economic and cultural exchange and dependency, largely on the ex-colonial powers.
Since the end of the cold war Development Studies has experienced major changes in approach and
substance. Not only has the global political climate changed from the Cold War to emphasize
growing globalization and new global power relationships, but there is a widespread recognition of
the relative failure of over 50 years of development in many regions – the number, if not the
proportion of very poor people has been growing. While there are some obvious ‗success stories‘ –
notably the NICs and resource-rich states – global disparities are widening as development is
increasingly seen in the mechanistic and simplistic but relatively easily measured terms of the
MDGs.
The disappointment about the success of development, especially in the poorest countries and for
the poorest groups, has been responsible for the growing emphasis on a new critical approach
associated with anti-development and post-development theory in which there is less concern for
global models and similarities but greater recognition of locally specific development policies and
practices. Development Studies as a cohesive and systematic field of study has emerged and
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continues to develop, becoming better integrated with the mainstream of the social sciences, and
not only or even mainly with economics, as it was in the earlier periods.
1.2.2. The Growth of Population Studies

Population Studies as a body of knowledge and cohesive theory has also experienced changes in
content, context and approach, but over a longer period than Development Studies. The beginnings
of Population Studies, though not conceptualized as such at the time, were set the late eighteenth
century with the intellectual controversies over the causes and impacts of the French Revolution of
1789.
T.R. Malthus himself developed his ideas about the nature of poverty as a response to the socialist
writings of William Godwin, who argued that unequal distribution of power in society was the root
cause of poverty. Malthus in reply argued that the poor were largely responsible for their own
poverty, and that population growth would in the long run generate even greater poverty and
inequality as the population would outstrip the resources on which they could survive(the debate
will be discussed in detail in the third chapter of this module).
When population was studies given much emphasis in history?
Dear learner, as with Development Studies, Population Studies was given a great boost after the
Second World War through the UN with the formation of its Population Division and its
development of census and other data collection programs for member countries. With the
increasing availability of census data, often for the first time, systematic population analysis
become the norm for all countries, and the data that were collected mainly for government planning
purposes also became the raw material for academic population analysis at the national scale.
Furthermore, since the programs for census and other survey data collection were planned within
the UN and other international agencies, the data they collected to similar specifications were
internationally comparable.
1.3. The Sources of Demographic Information

In this section will deal with the sources of Population data.
The basic sources of demographic data are national censuses, registers, and surveys. National
censuses and registers differ in that the former are conducted on a decennial which means every ten
years (or, in some countries, quinquennial i.e. every five years) basis, while the latter, theoretically
at least, are compiled continuously. Actually, registration data of population events are usually
compiled and published annually or monthly, but they are gathered continuously.
A census may be likened to taking a snapshot of a population at one point in time, say, once every
ten years, and in this snapshot getting a picture of the size of the population, its characteristics, and
its spatial distribution. Conversely, a register may be thought of as a continuous compilation of
major population events, often births, deaths, marriages, divorces, and sometimes migrations. As a
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birth or a death occurs, it is registered with the government; the registrations thus occur
continuously.
Censuses and registers are intended to cover the entire population. In a national census, everyone
in the population is supposed to be enumerated, and all the demographic events (births, deaths, and
so forth) that occur in the population are supposed to be registered. Surveys, on the other hand, are
by definition administered to only a fraction of the population. Yet they often gather data on many
of the items included in censuses and registers, plus additional items of interest to demographers
not included in them. We now cover in some detail each of these three sources of demographic
data.
1.3.1. National Censuses

A national census is ―the total process of collecting, compiling, and publishing demographic,
economic, and social data pertaining, at a specified time . . . , to all persons in a country or
delimited territory‖. The principal objective of a census is to obtain data about the size,
composition, and distribution of the population. A typical census thus includes information about
the size of the population and its social and geographic subpopulations, as well as data on their age
and sex composition band their educational composition (levels of literacy and educational
attainment and extent of school attendance).
Many censuses also contain information on economically active and inactive populations, including
data on the industrial and occupational composition of the working population, as well as economic
(salary and income) data. Other population data in a typical census include information pertaining
to country or area of birth, citizenship, language, recent migration experience, religion, and ethnic
heritage, which refers to group distinctions based on shared cultural origins.
In the actual enumeration of the population, there are two ways to count people: by following a de
jure method or by following a de facto method. In the case of a de jure enumeration, the census
covers the entire territory of the country and counts persons according to their ―usual‖ or ―normal‖
place of residence in the country. A de facto enumeration also covers the entire territory of the
country but counts each person in the population according to his/her geographical location on the
day of the census undertaking. For instance, a person who resides with her family in Hawassa, but
who is traveling on census day and happens to be counted in Shashemene, would be counted as a
resident of Hawassa if the census was a de jure census but would be assigned to Shashemene if it
was a de facto census. Canada and the United States follow a de jure approach, as do many
European countries, for example, Austria, Belgium, Croatia, the Czech Republic, Denmark,
Germany, the Netherlands, Norway, Sweden, and Switzerland. Of the more than 230 countries
conducting national censuses, however, the de facto type is much more common than the de jure.
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De Facto and De Jure Populations
At any moment in time any specific geographic area has a de facto population, which consists of all
individuals who are present in the area. This concept is unequivocal but may not always be highly
relevant. Consider the following groups:
(1) persons usually resident and present;
(2) persons usually resident but absent;
(3) Persons temporarily present but usually resident elsewhere.
The de facto population comprises (1) and (3), but excludes (2). Often one is interested in the
usually resident, or de jure, population consisting of (1) and (2). The distinction may seem simple
until one considers the cases frequently encountered in practice:
To summarize, the following are the basic features of a population and housing census
a) Individuals in the population and each set of living quarters are enumerated separately and
the characteristics thereof are recorded separately.
b) Universality within a defined geographic area/territory. The population census potentially
covers the whole population in a clearly defined territory. It should include every person
present and/or usual residents depending on whether the type of population count is de facto
or de jure. In the absence of comprehensive population or administrative registers, censuses
are the only source that can provide small area statistics.
c) The enumeration has to be as simultaneous as possible. All persons and dwellings should be
enumerated with respect to the same well-defined reference period.
d) Censuses are usually conducted at defined intervals. Most countries conduct censuses every
10 years while others every five years. This facilitates the availability of comparable
information at fixed intervals.
Have you attempted? Good. As shown in the table below, Census has various advantages and
disadvantages.
Table 1.4- Advantages and disadvantages of Census
Advantages Disadvantages
 The coverage aims to be universal  The size and complexity of the exercise
 The census provides an important means that the content and quality control
sampling frame for subsequent surveys efforts may be limited
and studies  The cost of carrying out a census means
 The census can serve as a useful tool for that most countries can pursue an
‗nation-building‘, by involving the entire enumeration only every ten years
population  There is usually a significant delay
 Census data avoids the sampling errors between when the data are collected and
that can occur with sample data the results released.
 Censuses provide data for small areas,  Censuses are easily politicised – either by
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such as districts and counties, which is groups who feel that they might be
vital for the planning of services systematically undercounted by the
exercise, or by parties found to be larger
than that of other groups
1.3.2. Registration Systems
United Nations define civil registration as ―the continuous, permanent, compulsory and universal
recording of the occurrence and characteristics of vital events pertaining to the population as
provided through decree or regulation in accordance with the legal requirements of a country.‖
Whereas censuses provide a cross-sectional (one point in time) portrayal of the size, composition,
and distribution of the population, registration systems pertain to the population‘s demographic
events (births and deaths and, in some places, migrations) and measure them as they occur. While
censuses are static, registers are dynamic and continuous. Registers apply principally to births and
deaths, although many countries also maintain registrations of marriages, divorces, and abortions.
Some countries maintain a migration registration system.
Strictly speaking, a population register is a list (i.e., a register) of persons that includes the name,
address, date of birth, and a personal identification number. Some registers have been maintained
for centuries, such as those in church parishes that record the baptisms and the deaths of the
parishioners. In Europe, the Nordic countries and the Netherlands maintain some kind of
population register, and many developing countries either have them in place or are planning to
implement them. In Eastern Europe under the Communists, ―population registers were used for
control (of the people) as well as for administrative purposes, and the successor regimes for the
most part have not maintained them‖. The United States does not maintain any kind of national
population register.
The earliest example on record of a population register of families and related household events
was in China during the Han Dynasty (205 BC–AD 220). A special demographic tradition of China
and the East Asian region as a whole was population registration. Its major function, however, ―was
the control of the population at the local level‖ and not necessarily the collection of continuous data
on demographic events. Population registers are of interest to demographers because they contain
birth and death records (certificates). But not all birth and death registrations occur in the context of
population registers. In fact, since a large number of countries do not maintain them, the
registration of many births and deaths occurs outside population registers.
For most countries in the world, the recording of vital events, that is, births and deaths along with
marriages, divorces, fetal deaths (stillbirths), and induced termination of pregnancies (abortions),
are recorded in their civil registration systems. But these registration systems need not necessarily
be population registers. Indeed, many are not. Although civil registration data are not 100 percent
accurate and complete in the more developed nations, their quality is far better than that in the
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poorer nations. Although civil registration systems in developing countries are ―seriously defective,
it would not be correct that the data are of little value to demographers.‖ Demographers have
developed special techniques for data adjustment and analysis, yielding a rough notion of trends
and differentials in these demographic events.
As articulated by Mary Ann Freedman and James A. Weed (2003: 960), ―Vital statistics form the
basis of fundamental demographic and epidemiologic measures.‖ Vital statistics are the data
derived from civil registration systems, as well as from the actual records of vital events. The
modern origin of vital statistics and their registration may be traced to the English ordinance in
1532 requiring that parish clerks in London maintain, on a weekly basis, the registration of deaths
and christenings. These reports were begun in response to the plagues of the late sixteenth and early
seventeenth centuries and were published in a nearly unbroken series for decades. Merchants used
those data as a rough gauge of the likelihood of their clientele to flee to the countryside during
epidemics.
With regard to the modern era, the registrations of one‘s birth and death are fundamental human
rights. The second clause of Article 24 of the International Covenant on Civil shall be registered
immediately after birth and shall have a name‖. The ICCPR also states that ―for nation states to
take appropriate measures to protect and enhance the life expectancy of their populations, they
must have at their disposal accurate and detailed information about patterns and trends of
mortality‖, thus also requiring death registration.
What advantages come from registering vital events?

The advantages of vital registration can be divided into two categories:
 Legal
 Statistical
When a demographic event is registered, legal documents are issued as proof of this event. This
confers a range of legal benefits upon the holder.
 Registration of a birth establishes and protects the identity of an individual, and confers
citizenship upon them. This legal recognition entitles the individual to state services and
protection from exploitation.
 The establishment of a legal identity (and the corresponding legal documents) allows
individuals to vote, to be registered for education, and to move between countries (through
the ability to apply for a passport).
 In many countries valid death certificates are required before a burial permit can be
obtained.
 Valid death certificates are required before life assurance payments will be made.
 In the event of a death, marriage certificates and birth certificates showing parentage are
important in securing inheritance and land rights.
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In addition to legal benefits for individuals, there are benefits for society which result from the
availability of high quality, up to date information on births, deaths and causes of deaths.
 Continuous registration of births and deaths allows for inter-censal population estimates.
 Death registration and detailed cause of death classification are important for understanding
the health of a population. This can then be used to formulate and prioritize effective public
health policies and interventions.
 The same information allows for monitoring of the effectiveness of public health
interventions. This allows governments to ensure that tax money is spent in effective ways,
and gives accountability to aid donors that donated money is improving the health of a
population in the way that it was intended.
 Vital registration also allows for monitoring progress towards targets, such as
the Millennium Development Goals (MDGs) and Sustainable Development Goals (SDGs).
Without continuous registration of vital events, it is difficult to know whether progress is
being made and whether the target is likely to be reached by 2015.
1.3.3. Surveys
In an ideal situation a vital registration system will cover all the demographic events occurring in
a population, and this should be considered the ultimate aim in terms of gathering vital statistics.
However, complete vital registration systems are time-consuming and expensive to set up, and until
this is achieved, sample registration systems can be used to gain high quality information on births
and deaths.
Demographers rely on a third source of demographic data, sample surveys, often because censuses
and registration systems do not contain the extensive kinds of information needed to address some
of the more critical demographic questions. This is particularly true with respect to the analysis of
fertility, although it also applies to mortality and migration.
When we contrast censuses and samples, census is a study comprising the whole population of
interest, whereas a sample involves only a part. A population census refers more specifically to a
complete count of the population of an area at a given time. Censuses may be combined with
samples in various ways. On the other hand, Sample surveys are inexpensive, most flexible and
rapid methods.
Surveys are required for the collection of more detailed information. By administering surveys to
carefully selected random samples of the larger populations, demographers are better able to
uncover underlying patterns of demographic behavior than is possible with materials from censuses
and registration systems. Here are some of the major surveys that are used by demographers.
World Fertility Surveys
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Beginning in the 1970s, coordinated cross-national fertility surveys were introduced in the
statistical and demographic communities as an important source of fertility and related
demographic information. Between 1974 and 1986, sample surveys to gather data on reproductive
behavior and related social and psychological indicators were conducted in 62 countries,
representing 40 percent of the world‘s population, under the auspices of the World Fertility
Survey (WFS).
Demographic and Health Surveys
The WFS was followed by another coordinated international program of research, the
Demographic and Health Survey (DHS), with more than 200 sample surveys carried out in 75
developing countries since 1984. DHSs are nationally representative household surveys with large
sample sizes (usually between 5,000 and 30,000 households). These surveys provide data for many
variables in the areas of fertility, population, health, and nutrition. Typically, the surveys are
conducted every five years to permit comparisons over time. Interim surveys are conducted
between DHS rounds and have shorter questionnaires and smaller samples than the DHS surveys
(2,000 to 3,000 households).
CHAPTER TWO
IMPACT OF RAPID POPULATION GROWTH ON SOCIO ECONOMIC
DEVELOPMENT
2.1 Social Implications of Population Growth
Rapid population growth in less developed countries is linked to many problems, including
poverty, hunger, high infant mortality and inadequate social services and infrastructure
(transportation, communication etc.) Rapid population growth may intensify the hunger problem in
the most rapidly growing countries. Population growth can reduce or eliminate
After completing this chapter the learner is able to:
 Describe the social, economic and environmental implications of population growth.
 Explain the relationship and effects of health on development.
 Mention the widely used measures of economic development and explain their limitations.
 List the social indicators of development food production gains resulting from
modernization of farming.
Population pressures may also encourage practices such as over irrigation and overuse of
crop lands, which undermine the capacity to feed larger numbers. In some cases population
growth is quite directly related to a social problem because it increases the absolute
numbers whose needs must be met. For example some less developed countries have made
enormous progress in increasing the percentage of children enrolled in school. However,
because of population growth during the same period, the number of children who are not
enrolled in school also increased because there were insufficient resources to meet the
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growing need. Similar observations could be made about jobs and employment, housing,
sanitation and other human needs such as water supply, transportation, energy requirement
etc. These problem are compounded when large numbers migrate from rural to urban areas
and increase the burden placed on already inadequate supplies and services.
2.2 Population Growth and Environment

The relationship between population growth and environmental degradation may appear to be
rather straight foreword. More people demand more resources and generate more waste. Clearly
one of the challenges of a growing population is the mere presence of so many people sharing a
limited number of resources strains the environment. Many of the world‘s population live in poor
countries already strained by food insecurity; inadequate sanitation, water supply and housing; and
an inability to meet the basic needs of the current population. These same countries are also among
the fastest growing places in the world. A large proportion of these populations are supported
through subsistence agriculture. As populations grow competition for fertile land and the used of
limited resources increases. Meeting the increasing demand for food is probably the most basic
challenge and the most salient population and environment crisis.
Traditional agricultural farming in developing countries with increasing population growth rate,
often involves the cultivation of fragile soils that are difficult to farm, such as dry lands,
highlands, and forests. When farm lands expand towards fragile lands in order to keep pace with
the needs of a growing population in a region, it can lead to deforestation, erosion and
desertification.
2.3 Health and Development

Development is movement of the whole system upward. Improving health conditions used to be
low priority of least developed countries (LDC) governments. It was regarded as something the
governments would like to do if possible, but not at the expense of more directly productive
expenditure categories. Development specialists generally took similar view as far as known. No
previous economic development textbook includes a chapter on health and nutrition.
Recently, however, more attention has been devoted to relationship between health and
development. One reason for this is the growing interest in equity- oriented development strategies
for the basic human needs variety, in which provision of basic health services necessarily plays an
important part. A second reason is that health expenditures, like education expenditures, are
increasingly regarded as investments in human capital. The health- development relationship is
reciprocal one. Proponents of health -sector programs often deny that development can or will do
the job, arguing that special programs in nutrition, health care and environmental sanitation are also
needed. Sometimes these proponents go so far to argue that development can be injurious to health,
17
or that provision of appropriate health programs can do the job by itself, even in the absence of
significant over all development. Opponents of this view reply that health status is generally
relocated to income level, and specific health measures often fail to have much effect when the
surrounding socio- economic and physical environments are unfavorable to health.
2.3.1 Effects of Health on Development

Better health is an important goal in its own right.Health increases the range of human potentialities
of all kinds and is rightly regarded as a basic human need. Health is valued for its own sake.
Everyone can benefit from better health in the present, and improved health for the young will lead
to healthier population in the future. Like education, health services increase the quality of human
resources both now and in the future. Better worker health can provide immediate benefits by
increasing the worker‘s strength and ability to concentrate while on the job. Better child health and
nutrition promote future productively by helping children develop in-to stronger, healthier adults.
In addition they supplement the acquisition of productive skills and attitudes through schooling. It
has been shown that healthy well- fed children have higher attendance rates and are able to
concentrate better while they are in school.
Unlike education, health expenditure also increase the quantity of human resources in the future by
lengthening the expected working life. In this way too, they complement, since returns in education
should be higher if people can be expected to work and even can for longer period.
Besides increasing the quantity and quality of human resource, health also increase the productivity
of non human resources. The most important example is the large tracts of land rendered
uninhabitable or unusable by endemc diseases which had blocked access to certain areas were
brought under relatively effective control in the 20th century.
Malaria and yellow fever blocked access to many parts of Latin America, Africa, and Asia before
these diseases were brought under relatively effective control in the 20th century.
Even today schistasomiasis makes it unsafe for people to enter lakes and streams in sections in
Africa, while trypanosomiasis (African sleeping sickness) restricts the range of livestock industry.
Some of the causes of sickness and premature death in the LDCs that deserve more careful
examination are environmental health problems, malnutrition and lack of medical care of adequate
quantity, quality and type.
The principal problem of environmental sanitation in LDCs is the contamination of the water
supply, and sometimes also of food and soil, with human waste. This occurs in villages and cities
alike. Although most urban residents have access to piped drinking water, the public water supply
is often rendered unsafe by contamination in the distribution process as the result of a faulty or non-
existent sewage system.
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Few rural residents enjoy either piped water or decent sanitation. Many of the infectious diseases,
parasitic and respiratory diseases that cause so much sickness and death in poor countries are
waterborne. Typhoid, dysentery, and cholera are leading examples.
A second type of environmental sanitation problem arises from housing with insufficient space;
ventilation and access to sunlight, (more common in urban areas) promote the spread of air-borne
diseases such as tuberculosis. Historically, improvements in sanitation seem to be closely
associated with reduction in disease, becoming effective long before successive treatment have
been discovered. Medical Services Most LDCs have too few health services, too poorly distributed.
Public expenditure on health services are much smaller in developing countries even as a
percentage of Gross National Product (GNP). Governments in the poorer countries were spending $
2 per capita around 1980.
The inadequacy becomes clear when we consider that in LDCs in contrast to USA; the public
sector expenditure represents the bulk of the modern, western-style medical and health services.
Low medical expenditures in the past have lead to inadequate stock of health facilities and
manpower in most developing countries. Medical training in many of the poorest countries may not
benefit society, because doctors are highly mobile and once trained, many emigrate to seek higher
income elsewhere. In many cases increasing the supply of nurses and other health auxiliaries may
be a better way to improve services.
2.3.2. Measures (Indicators) Of Development

Ever since economists have tackled the development problems of the less developed countries, the
principal yardsticks for measurement of economic development have been GNP, its components,
and their growth. Despite the many problems with national accounting in developing countries, the
nationals accounts have continued to be the main focus of discussions of growth, the allocations
between investment, consumption and saving, and the relative influence of various sectors in total
value added. GNP per head is widely accepted as the best single indicator of development, both
historically and for international comparison, despite well known problems.
Despite the overwhelming attention to growth, the deficiencies of GNP per head as an indicator of
economic development have been apparent to many for some years. It has been pointed out that
economic welfare comprises not only national income per head, but also its distribution and the
degree of steadiness or fluctuation over time. Measurement problems become apparent when one
attempts to make inter country comparisons of GNP/head. Part of the problem rises from the fact
that official exchange rates do not measure relative domestic purchasing power, since a large
portion of marked GNP does not enter into world trade. In addition trade policies often create
distortions in nominal exchange rates, so that they fail to reflect the true value of even that
proportion of GNP which is traded.
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2.4 GNP and Social Indicators
Several studies have indicated a high correlation between economic indicators, including GNP and
social indicators. This might suggest that GNP can be used as a proxy measure of social
development. The current discussion of basic-needs orientated development focuses on the
alleviation of poverty through a variety of measures other than nearly redistribution of incremental
output. Such a focus supplements attention to what is produced, in what ways, from whom and with
what impact. Obviously the rapid growth of output will still be important to
the alleviation of poverty, and GNP per head remains an important figure. What is required are
some indicators of the composition and beneficiaries of GNP which would supplement the GNP
data, not replace them. The basic needs approach, therefore, can be the instrument for giving the
necessary focus to work on social indicators.
Widely used Development Indicators include:
 GNP PER CAPITA (GROSS NATIONAL PRODUCT PER CAPITA).
 GROWTH RATE OF GNP.
 GNP is the market value of all the production in the economy during one year.
Approaches to Measure GNP

• Output Approach
• Income Approach
• Expenditure Approach
All three approaches measure flow of goods and services produced and consumed in the country
from different perspectives.
• All expenditures must be income to someone else in the society. Purchase and sale of goods
• Output produced is the source of income and expenditure.
• So, all three approaches should provide identical values.
How Good Is GNP /Capita As A Measure Of Development?

• Positive relationship between income and life expectancy
• Positive relationship between income and health/nutritional status
• Positive relationship between income and education
• Positive relationship between income and environment (Quality of housing, water supply etc).
In general, the relationship between income and other variables indicating socio-economic
development is positive. However, there are some exceptions.
- Oil- rich middle-eastern countries. Their GNPs/ capita are high but the social indicators are low.
- Sri-Lanka and China. Their GNP/ capita are relatively low but the social indicators are high.
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GNP/Capita Or Its Growth Rate May Be A Misleading Indicator Of Social And Economic
Development Because:
• It fails to indicate the pattern of income distribution in the country or the society.
• The measurement of GNP itself is problematic.
• All commodities, irrespective of its impact on human welfare, evaluated at market price and
added together to derive GNP.
• Problem of international comparison.
Adjustments can be made to GNP to make it a more Sensitive Measure of Social Welfare or
Human Development These Adjustments Are:
 Adjust GNP or GNP growth for income distribution in the country.

 Adjust GNP for the value of goods not included in GNP calculations and the value of
―goods‖ added.
 Purchasing power parity rate for international comparison.
Social Indicators Of Development Include:

Health -Life expectancy at birth.
Education -Literacy.
 Primary school enrolment (as % of population aged 5-14).

 Food -Calorie supply per head or calorie supply as a percent of requirements Water supply
-Infant mortality (per thousand live births).
 Percent of population with access to potable water.
 Sanitation -Infant mortality (Per thousand live births). –Percent of population with access
to sanitation facilities.
* Infant mortality is assumed to be a good indicator of the availability of sanitation and clear water
facilities, because of the susceptibility of infants to water-borne diseases, and data on infant
mortality are readily available than data on access to clean water.
3.4. Health Indicators and GNP

It is observed that mortality is negatively related to GNP per capita.
The Infant mortality Rate:-Falls from more than 100 per 1000 live births to only 12 per 1000 as
one move up the income scale from countries with less than 300 a year to countries with more
than 5000 per capita.
Crude Death Rate:- Also, falls although less than one would expect, because of the younger
population structure in the poorer countries.
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Life Expectancy- Another way to look at the relationship between development and mortality in
terms of life expectancy (Average number of years members of a given population are expected to
live).Children born in 1980 in the poorest countries could expect to live only 53 years on average,
while children born in the same period in the richest countries were likely to live 75 years on
average. This difference provides one measure of the effect of economic development of health.
Links Between Health and Income
Investing In People
There is overwhelming evidence that human capital is one of the keys to reducing poverty.
Moreover, improvements in health, education and nutrition reinforce each other. But the poor
generally luck access to basic services. There is too little investment in their human capital, and this
increases the probability that they and their children will remain poor. To break this vicious circle,
governments must make reaching the poor priority in its own right.
Providing Access
To The Poor Providing the poor with access to social services requires a clear commitment. This
must be reflected in the infrastructure and organization of the social sectors and in the way they are
financed. Much can be learned from decades of experience in countries at different levels of
development and with varying needs.
Infrastructure and Organization
The biggest obstacle for the poor in gaining access to health and education services is the lack of
physical structure, especially in rural areas. The urban bias in the provision of services affects both
quantity and quality. The sheer lack of facilities makes necessary a continued expansion of
appropriate services, especially rural health clinics and primary schools. This will almost certainly
benefit the poor. Improving quality will require more funds, better use of the available resources
and greater accountability in administration.
Health: - The government is usually the dominant provider of health care, but in many countries
the private sector also provides some (mostly curative) services. Although different countries have
different needs several broad principles hold.
First: - The state should take responsibility for health intervention that have a public- good
character (example, clean air, and traffic) or that generate benefits to the community in addition to
private benefits (example, immunization against communicable diseases).
Second: - in curative care the main role of the state as a provider of services should be to supply
basic services in those regions that the private sector is unlikely to serve.
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Third: If a private delivery system is in place, the state should make sure that, the poor have access
to basic care. In many countries, in other words, the government should continue to expand basic
services but with a greater emphasis on access for the poor.
CHAPTER THREE
POPULATION POLCIES
3. Population Policy
3.1. Definition of Population Policy

? What is population policy? ________
 Population policy may be defined as deliberately constructed or modified institutional

arrangements and/or specific programs through which governments influence, directly or
indirectly, demographic change.
 The generality of the definition lends itself to varying interpretations. For any given
country, the aim of population policy may be narrowly construe/interpret as bringing about
quantitative changes in the membership of the territorially circumscribed population under
the government‗s jurisdiction.
 Additions to membership are effected only through births and immigration; losses
are caused by emigration and by deaths. Concern with this last component is usually
seen as a matter for health policy, leaving fertility and migration as the key objects
of governmental interest in population policy.
 More broadly, policy intent/intention/target may also aim at modification of qualitative
aspects of these phenomena—fertility and international migration—including the
composition of the population by various demographic characteristics and the population‗s
spatial distribution.
 Furthermore, governments‗concern with population matters can also extend beyond the
borders of their own jurisdictions. International aspects of population policy have become
increasingly salient in the contemporary world.
3.2. Types of Population Policy

? Distinguish between pronatalist and antinatalist population policy.
Population Policies: Pronatalist
 Throughout history, governments have attempted to modify the direction of population
change, both upward and downward.
 Pronatalist polices, aimed at more births and faster population growth, have been
pursued/practiced in times and places where national well -being has been equated with
population size.
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 It is sometimes the fear of depopulation, with consequent loss of national power and
influence, that drives pronatalist efforts (This has been true of France, according to many
observes.)
 In light of the ― birth dearth/lack/shortage problems governments in some of the
odd/peculiar countries now experiencing below- replacement fertility rates have made
efforts to raise the birth rate. In Europe and Japan, especially, where attitudes toward
immigration have historically been more hostile/unfriendly than in the United States higher
birth rates offer the only means to hold an eventual decline in population Sweden has
pursued a pronatalist policy, at least implicitly/totally/completely since the 1970s. Family
benefits were made quite generous, in the form of cash payments, tax incentives, and
extended maternity leaves. Japan has tried similar pronatalist policies- with a similar lack of
sustained success.
 Hungary, a formerly socialist nation, provides child allowances and maternity leave
benefits, in addition to an extensive childcare network for working mothers.
 Although in recent years the United States has seen its fertility rate drop to approximately
replacement level, and even briefly below that level, there is no prospect of U.S.
depopulation-- and thus no push for a pronatalist policy.
 What differentiates the United States from nearly all other developed nations is a heavy rate
of net immigration. Without it, the demography future of the United States would much
more closely resemble that of the other industrialized countries. With it, the nation will see
population expand significantly, owing to the number of immigrants themselves, their
relative youthfulness, and their high rates of fertility. It immigration policy can be thoughts
of as a form of population policy, then the United States has accepted (if only
implicitly/unconditionally) a policy strongly favoring a larger national population.
Population Policy: Antinatalist

 Antinatalist policies, aimed at slower population growth have been through more likely to
serve the economic and social interests of the people in a number of countries, generally
poorer, high- fertility countries in Africa and in south and western Asia.
 For over half a century policies, aimed at slowing population growth in developing
countries have been discussed, debated, and, with wide variations, implemented.
 An influential rationale for antinatalist policies was provided in a 1958 study by Ansley
Coale and Edgar Hoover, who argued that high rates of population growth
jeopardized/make vulnerable/endangered long- term economic development by diverting
resources from growth -enhancing investments to the mere maintenance of population.
 Reduced fertility, on the other hand, could speed economic development by freeing more
resources for investment in productivity- enhancing activities. On the basis of this kind of
thinking, the industrialized nations began funding population programs in the less
developed countries (LDCs) in the 1960s and 1970s, with the United States playing leading
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role. By 1997, 68 Nations were on record as desiring to limit their population growth; the
majorities were in Africa.
 power nations, less able to raise the needed public funds, have received considerable
financial and technical support for family planning from the UN population fund (UNFPA)
the united states Agency for international Development (USAID), non governmental
agencies like international planned parenthood, and private foundation, such as the ford and
Rockefeller foundation what seems to be agreed on all sides in that no single family-
planning model fits every country each country‗s efforts must be
tailored/modified/customized/adapted to its own traditions, culture, and perceptions of what
needs to be done.
 In addition to providing information about contraceptive choices and actually delivering
contraceptive service to clients, some family- planning programs offer more general health
services to women and children, and some engage in propaganda to change attitudes about
family size delivering messages about the benefits of smaller families seem to have been
quite effective in changing attitudes and behavior in some countries.
3.3. Global Population Policy

 There is no super government with the authority to impose population a policy on sovereign
states polices on sovereign states around the world. But the views of the international
community on population matters can have an impact on the deliberations of national policy
makers and on the academic, media, and political elites who shapes the policies. over the
years, the most important forum for debating population policy has been a series of
decennial/years, UN-sponsored world population conferences, Which now go by the official
title of International Conference on Population and Development (ICPD), These
conclaves/council/convention, to which most governments send delegations, have been held
in Bucharest (1974), Mexico city (1984), and Cairo (1994), with rather different messages
conveyed to the world on each occasion.
 At Bucharest ideology/ideas/beliefs/philosophy dominated the proceedings. The financial

support of rich countries for family planning programs in the poorer ones was attacked by
some delegates as self –serving. A number of national delegations made clear their
opposition to policies aimed at lowering population growth rates. ―Economic development
is the best contraceptive‗s‖ in the words of one slogan voiced at the conference. For the first
time, an international population ―plan of action‖ approving. The plan included a numerical
target for reduced birth rates in the developing countries, a statement of the ―basic human
right‖ of all couples to make their own decisions about family size, and support for full
gender equally in education, politics and economic life.
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3.4. Population Policies: China and India
What population policies have been followed by the world‗s two population giants, China and
India? China with approximately 1.3 billion people in 1999 and a TFR now below replacement
level at 1.8, has pursued a forceful national program of slower population growth for more than two
decades. India, with around 1 billion people and a TFR of 3.3, has followed a more decentralized
system of family planning in the years since India became the first developing nation to offer
family- planning services in 1951. A comparison of the two cases will be instructive.
China‗s fertility rate began falling first in its cities during the 1960s. There was no explicit national
policy aiming for smaller families until 1971, when the wan xi shao campaign began. The
translation is latter (marriage), Longer (intervals between births), Fewer (children). This program
evolved in to the ― one child policy‖ of 1979 that has been the focus of so much international
attention. Under the one --child policy. Couples are given incentives and disincentives to limit
themselves to a single child. Urban couples with one child who pledge not to have any more
children receive monthly child- support allowances until the child reaches the age of 14 promises of
higher pensions in their own retirement and more spacious housing . The child receives preferential
treatment in applying to schools and for jobs. in rural areas , a modified policy offers added
monthly payment in cash and kind to couples who pledge to stop at on child. One- child families
also get the same grain ration and the same size plots for private cultivation as larger families, thus
reaping an indirect advantage. The Chinese provinces mayimplement additional policies on an
individual basis, and some of these have included higher taxes on families who have more than two
children, and even imposition on the parents of full maternity costs and medical and educational
costs for such children. Whether the one- child policy has been a success is debatable. China once
set a goal of capping national population at 1.2 billion by the year 2000. That limit has already been
breached, and while the TFR has fallen below replacement level, china‗s current population is so
youthful, with so many young adults entering their childbearing years, that the total population is
bound to increase for a few more decades at least. Some also question how much of the fall in
fertility has been due to the one child policy. Much of the extraordinary drop from a TFR of 7.5 in
1963 to 2.5 in 1983 occurred before the new policy was announced in 1979. And much of china‗s
fertility decline might have occurred even in the absence of a strict antinalalist policy .But criticism
of the one- child policy has been directed less at its efficacy than at its coercive features. When
incentives and disincentives become strong enough, the policy looks like compulsory birth control.
One of the policy‗s worst side effects, in a culture that values male children above female, can be
seen in the neglect of infant girls and sex--selective abortion of female fetuses.
India has been seeking slower population growth ever since its first five-year plan (for 1951-1956)
called for the creation of family planning centers throughout the country. At that time, the Indian
TFR stood at 6.0. Early efforts focused on information, education, and research in to contraceptive
methods. Results were disappointing, with fertility declines seen mainly in a few states, in the
upper classes, and in cities determined to do better, Indira Gandhi‗s government in 1976 revamped
the program, increased the monetary incentives to participants, and suggested that state legislatures
26
consider passing laws that ordered compulsory sterilization after the birth of a couple‗s third child
(one state actually did so.) controversy and violence ensued, and Gandhi‗s party was defeated in
elections a year later. Her return to office in 1980 brought a renewed commitment to the national
family- planning effort, as did her son‗s rise to power in 1984,-Rajiv Gandhi promised a broader,
higher -quality national program, with more generous rewards to women who limited their family
sizes But demographic results at the national level were and have continued to be , less than
impressive. According to some observes, the programhas been overly bureaucratic inconsistent, and
inflexible too much reliance has been placed on sterilization (first male, later female) rather than on
offering couples an array of contraceptive choices. Fertility has declined in India but not nearly as
quickly as policymakers once projected. Although they hoped at one time to see replacement level
fertility achieved by the end of the twenty century, the revised goal is to reach that mark by the
period 2011-2016. As with china, this will entail continued population growth for decades to come,
due to the demographic momentum of large numbers of Indians about to enter of already in their
reproductive years. How much of India‗s fertility decline is due to its population policy and how
much to general modernization trends is unclear. The rates of fertility reduction very widely across
the states of India. It has been noted that where fertility is highest for example, in the northern
states of Uttar Pradesh, Bihar, and Rajasthan, educational levels, especially for females, are low. In
Kerala and Tamil Nadu, by contrast, fertility is low (TFRs of 1.7 and 2.2, respectively) while
educational levels and literacy rates are high. Women are accorded more economic rights and
opportunities here than in other Indian states, and family -planning programs are less heavy handed
than they are in states with much higher fertility rates.
3.5. The National Population Policy of Ethiopia

The population policy that our country experiences is of antinatalist type. That is, it discourages
population growth.
6.5.1. Rationale
The analyses of the interrelationship between demographic factors on the one hand and
developmental variables on the other reveal that demographic factors such as rapid population
growth, young age structure and the uneven spatial distribution of the population fuelled by a
continuing high fertility regime exacerbate/aggravate/intensify the severe state of
underdevelopment that characterizes contemporary Ethiopian society. Underdevelopment manifests
itself among others, in the following ways:
a) low productivity in almost all sectors of the economy resulting in high rates of unemployment
and underemployment and hence in absolute deprivation/scarcity and apathy/indifference,
b) low accessibility of basic social services such as education, health and housing,
c) the perennial/perpetual/recurrent problem of food insecurity affecting many parts of the country,
c) high prevalence of maternal, infant and child morbidity and mortality - problems that are
partially attributed to the low status of women and high fertility and
d) low life expectancy at birth.
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High fertility and rapid on growth exert negative influences on economic and social development
and low economic and social development provide the climate favoring high fertility and rapid
population growth.
3.5.2. Goals, Objectives and Strategies of the Population Policy

This policy has for its major goal the harmonization of the rate of population growth, the capacity
of the country for the development and rational utilization of natural resources to the end that the
level of welfare of the population is maximized over time. The necessary of pursuing this goal is
dictated by the fact that the rudimentary/basic state of technologies development combined with
rapid population growth has made the effort of extricating/get out the country from its severe state
of underdevelopment; and extremely difficult task. Significantly reduction of the rate of population
growth by, primarily, addressing the problem of this fertility will, in the long run, be helpful in
easing the pressure from contending/challenging demands of development resources.
General Objectives
The paths to the attainment of the goal of harmonizing the interrelationship between population
dynamics and other factors affecting the probability of development are many. Given the
assumption that there is a two way interaction between demographic factors of the one hand and
other development indicators on the other, sound fertility reduction policy requires that action be
taken in carefully selected areas in both spheres. Thus population policy aims at pursuing the
following general objectives:
a) Closing the gap between high population growth and low economic productivity through
planned reduction of population growth and increasing economic returns;
b) Expediting/speed up economic and social development processes through holistic integrated
development programmes designed to expedite the structural differentiation of the economy and
employment;
c) Reducing the rate to urban migration;
d) Maintaining/improving the carrying capacity of the environment by taking appropriate

environmental protection/conservation measures;
e) Raising the economic and social status of women by freeing them from the restrictions and
drudgeries/hard work of traditional life and making it possible for them to participate productively
in the larger community;
f) Significantly improving the social and economic status of vulnerable groups (women, youth,
children and the elderly).
Specific Objectives
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a) Reducing the current total fertility rate of 7.7 children per woman to approximately 4.0 by the
year 2015;
b) Reducing maternal, infant child morbidity and mortality rates as well as promoting the level of
general welfare of the population;
c) Significantly increasing female participation at all levels of the educational system;
e) Removing all legal customary practices militating against the full enjoyment of economic and
social rights by women including the full enjoyment of property rights and access to gainful
employment;
f) Ensuring spatially balanced population distribution patterns with a view to maintaining

environmental security and extending the scope of development activities;
g) Improving productivity in agriculture and introducing off-farm non agricultural activities for the
purpose of employment diversification;
h) Mounting an effective country wide population information and education programme

addressing issues pertaining to small family size and its relationship with human welfare and
environmental security.
? Mention the rationale for the population policy of Ethiopia. _________
? List the specific and general objectives of the population policy of Ethiopia._____________
Strategies
i) Expanding clinical and community based contraceptive distribution services by
mobilizing public and private resources;
ii) Promoting breast feeding as a means of dealing with the problem of childhood
malnutrition and increasing the time span between earlier and subsequent pregnancies
through IEC;
iii) Raising the minimum age at marriage for girls from the current lower age limit of 15 to,
at least, 18 years;
iv) Planning and implementing counseling services in the educational system with the view to
reducing the current high attrition/drop our rate of females;
iv) Providing career counseling services in second and third level institutions to enable
students especially girls to make appropriate career choices;
v) Designing and implementing a coherent long term policy that is likely to create
conditions facilitating an increased integration of women in the modern sector of the
economy;
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vi) Undertaking feasibility and experiments in respect to micro enterprises, and creating a
system for providing technical and credit support to men and women who have the
aptitude/skill/talent for engaging in small to medium sized private enterprises;
vii) Making population and family life related education and information widely available
via formal and informal media;
ix) Establishing a system for the production and effective distribution of low cost radio receivers
and information materials such as posters, flyer and all kings of promotional materials;
x) Amending all laws, impeding, in any way, the access of women to all social, economic and
cultural resources and their control over them including the ownership of property and businesses;
xi) Amending relevant articles and sections of the civil code/rules in order to remove unnecessary
restrictions pertaining to the advertisement, propagation and popularization of diverse conception
control methods;
xii) Ensuring and encouraging governmental and non-governmental agencies involved in social and
economic development programs that they incorporate gender and population content in their
activities by establishing within their organizations, appropriate units to deal with these issues;
xiii) Establishing teenage and youth counseling centers in reproductive health;
xiv) Facilitating research program development in reproductive health;
xv) Developing IEC programmes specially designed to promote male involvement in family
planning;
xvi) Diversifying methods of contraception with particular attention to increasing the availability of
male oriented methods;
? Identify the strategies of the population policy of Ethiopia._____________________________
3.5.3. Major Areas of Population Activities Requiring Priority Attention

a) Improving the Quality and Scope of Service Delivery: Existing service delivery systems are
limited in both scope and diversity. At present family planning services are available only through
the formal health structure. User choice of methods are restricted by the fact that the contraceptive
mix currently available is limited. Steps will, therefore, be taken to expand coverage and afford
greater choice of methods to users by:
i) Expanding the diversity and coverage of family planning service delivery through clinical and
community based outreach services;
ii) Encouraging and supporting the participation of non governmental organizations in the delivery
of population and family planning related services;
iii) Creating conditions that will permit users the widest possible choice of contraceptives by
diversifying the method mix available in the country
b) Population Research, Data Collection, Analysis and Dissemination: Among activities to be given
priority attention in programme development and implementation processes is improving and
strengthening domestic capacity for generating, analyzing and disseminating demographic and
population related information by making more domestic and external funds available to
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institutions engaged in demographic and population related research and training. In addition,
collaboration with foreign research and academic institutions will be actively sought. Further,
research activities will focus attention on the study of the complex interrelationship between
population factors and development variables. Thus the information generated this way will
represent critical inputs in development planning processes and provide relatively more accurate
bases for forecasting probabilities and trends of development. Work in this important area will be
considerably facilitated by:
i) Enacting laws/regulations making the registration of vital events (marriage, birth and
death) compulsory;
ii) Providing existing research institutions (Population Analysis and Studies Center
(PASC), the Demographic Training and Research Center (DTRC), etc.) With the
necessary technical and material support in order to enable them to process and
disseminate data generated by censuses, sample surveys (inter-censal surveys,
demographic and health surveys, household consumption surveys, labor force surveys,
etc.).
iii) In-service training for teachers and other development agents will be organized.
a) Expansion and Strengthening Domestic Capacity for Training in Population: The requirements
for high level technical personnel are currently met by sending men and women abroad for
graduate training in demography and population studies as well as providing graduate training
in population studies at the Demographic Training and Research Center of the Addis Ababa
University. Training of family planning workers is currently provided by the Family Guidance
Association of Ethiopia (FGAE) and the Ministry of Health through its institutions for the
training of nurses, midwives and health assistants. But in view of the critical need for more
trained personnel, expanded population programs envisaged in this policy it is necessary to
expand existing domestic capacity. Accordingly:
 Medical Schools
 Nursing and health assistants schools
 Junior Colleges
 Technical and vocational schools (e.g. institutions for the training of home
economists and teachers training institutions) in order to accelerate the integration of
family planning with existing social services, particularly health.
d) Expansion of IEC and Social Mobilization: Information, Education and Communication (IEC)
pertaining to population and development issues play a vital role in increasing popular awareness of
the issue of population and development and facilitated community participation in the
implementation of programmes. An effective implementation of a carefully designed IEC program
calls for the mobilization of all available institutional and manpower resources directly or indirectly
involved in the sphere of population and development information. Specifically IEC policy will
focus on formulating comprehensive policies and programs that will permit:
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i) A wider and more systematic use of multi-media channels to facilitate the use of population IEC
in expediting behavioral change relative to family size, reproductive behavior, reproductive health,
family nutrition, personal and environmental hygiene;
ii) The dissemination of population related information through community organizations, interest
groups, political bodies, women and youth groups, NGOs, adult education classes, industrial and
other work establishments where there is a significant concentration of worker force so on;
iii) The incorporation of population and family life education topics as integral parts of
formal education curricula at relevant levels of education;
iv) The incorporation of population related topics in the package of information carried to the
rural population by agricultural extension workers, informal community leaders, and other
community level development practitioners;
iv) The strengthening of the capacity of population and women's affairs units in relevant
government development agencies to produce and disseminate IEC programmes.
3.6. Factors Affecting Population Policies

What factors affect population policies? _____________________________________
There are a number of factors that influence the national population policy of a country. These
factors are grouped into three categories.
1. Political factors- these factors include the following legal actions and regulations:
a. Laws entirely or partly determined by population phenomena –these laws include such
demographic phenomena as ethnic composition, population size, labor force composition and
geographic distribution.
b. Laws indirectly affecting population- these are laws related to marriage, family and economic
matters: minimum age at marriage, rights and privileges of illegitimate/illegal/unlawful children,
employment laws especially those related to the rights of women and children to work and
c. Laws having a direct effect on population- these laws relate to regulations such as those directed
towards fertility (contraception and abortion cases) and migration (encouragement and/or
discouragement of emigration and immigration).
Moreover, the implementation and readiness to set a better population policy rests/depends on the
will, support and participation of political leaders and governmental commitment.
2. Social factors- the implementation of population policy can also be influenced by such social
factors as ethical, moral and theological or religious convictions. This implies that the will, support
and participation of religious leaders, the community participation and mass organizations
determine the entire performance of population policy.
3. Economic factors:-the availability of financial resources and economic considerations and needs
greatly influence the success of population policies.
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CHAPTER FOUR
SUSTAINABLE DEVELOPMENT AND NATURAL RESOURCE IN

ETHIOPIA
4. What is sustainable development?
"Sustainable development is development that meets the needs of the present, without
compromising the ability of future generations to meet their own needs."
The concept of sustainable development can be interpreted in many different ways, but at its core is
an approach to development that looks to balance different, and often competing, needs against an
awareness of the environmental, social and economic limitations we face as a society.
All too often, development is driven by one particular need, without fully considering the wider or
future impacts. We are already seeing the damage this kind of approach can cause, from large-scale
financial crises caused by irresponsible banking, to changes in global climate resulting from our
dependence on fossil fuel-based energy sources. The longer we pursue unsustainable development,
the more frequent and severe its consequences are likely to become, which is why we need to take
action now.
So is it all just about the environment?
Living within our environmental limits is one of the central principles of sustainable development.
One implication of not doing so is climate change.
But the focus of sustainable development is far broader than just the environment. It's also about
ensuring a strong, healthy and just society. This means meeting the diverse needs of all people in
existing and future communities, promoting personal wellbeing, social cohesion and inclusion, and
creating equal opportunity.
If sustainable development focuses on the future, does that mean we lose out now?
Not necessarily. Sustainable development is about finding better ways of doing things, both for the
future and the present. We might need to change the way we work and live now, but this doesn't
mean our quality of life will be reduced.
A sustainable development approach can bring many benefits in the short to medium term, for
example:
Savings - As a result of SDC scrutiny, government has saved over £60m by improving efficiency
across its estate.
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Health & Transport - Instead of driving, switching to walking or cycling for short journeys will
save you money, improve your health and is often just as quick and convenient.
How does it affect me?
The way we approach development affects everyone. The impacts of our decisions as a society
have very real consequences for people's lives. Poor planning of communities, for example, reduces
the quality of life for the people who live in them. (Relying on imports rather than growing food
locally puts the UK at risk of food shortages.)
Sustainable development provides an approach to making better decisions on the issues that affect
all of our lives. By incorporating health plans into the planning of new communities, for instance,
we can ensure that residents have easy access to healthcare and leisure facilities. (By encouraging
more sustainable food supply chains, we can ensure the UK has enough food for the long-term
future.)
How do we make it happen?
We all have a part to play. Small actions, taken collectively, can add up to real change. However, to
achieve sustainability in the UK, we believe the Government needs to take the lead. The SDC's job
is to help make this happen, and we do it through a mixture of scrutiny, advice and building
organisational capacity for sustainable development.
4.1 The four pillars of sustainability

The term sustainability is broadly used to indicate programs, initiatives and actions aimed at the
preservation of a particular resource. However, it actually refers to four distinct areas: human,
social, economic and environmental – known as the four pillars of sustainability.
4.1.1 Human sustainability
Human sustainability aims to maintain and improve the human capital in society. Investments in
the health and education systems, access to services, nutrition, knowledge and skills are all
programs under the umbrella of human sustainability. Natural resources and spaces available are
limited and there is a need to balance continual growth with improvements to health and achieving
economic wellbeing for everyone. In the context of business, an organisation will view itself as a
member of society and promote business values that respect human capital. Human sustainability
focuses on the importance of anyone directly or indirectly involved in the making of products, or
provision of services or broader stakeholders (the human capital of the organisation) (Benn et al.,
2014). Communities around the globe may be positively or negatively affected by business
activities, or impacted through methods used to source raw materials. Human sustainability
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encompasses the development of skills and human capacity to support the functions and
sustainability of the organisation and to promote the wellbeing of communities and society.
4.1.2 Social sustainability
Social sustainability aims to preserve social capital by investing and creating services that
constitute the framework of our society. The concept accommodates a larger view of the world in
relation to communities, cultures and globalisation. It means to preserve future generations and to
acknowledge that what we do can have an impact on others and on the world. Social sustainability
focuses on maintaining and improving social quality with concepts such as cohesion, reciprocity
and honesty and the importance of relationships amongst people. It can be encouraged and
supported by laws, information and shared ideas of equality and rights. Social sustainability
incorporates the idea of sustainable development as defined by the United Nations sustainable
development goals. The principle of sustainable development addresses social and economic
improvement that protects the environment and supports equality, and therefore the economy and
society and the ecological system are mutually dependent (Diesendorf, 2000).
4.1.3 Economic sustainability
Economic sustainability aims to maintain the capital intact. If social sustainability focuses on
improving social equality, economic sustainability aims to improve the standard of living. In the
context of business, it refers to the efficient use of assets to maintain company profitability over
time. As stated by the UK Government (Annual Report 2000, January 2001):
―Maintaining high and stable levels of economic growth is one of the key objectives of sustainable
development. Abandoning economic growth is not an option. But sustainable development is more
than just economic growth. The quality of growth matters as well as the quantity.‖
Critics of this model acknowledge that a great gap in modern accounting practices is not to include
the cost of damage to the earth in market prices (Hawking, 2010). A more recent approach to
economics acknowledges the limited incorporation of the ecological and social components in this
model. New economics is inclusive of natural capital (ecological systems) and social capital
(relationships amongst people) and challenges the mantra of capital that continual growth is good
and bigger is better, if it risks causing harm to the ecological and human system (Benn et al., 2014).
4.1.4 Environmental sustainability
Environmental sustainability aims to improve human welfare through the protection of natural
capital (e.g. land, air, water, minerals etc.). Initiatives and programs are defined environmentally
sustainable when they ensure that the needs of the population are met without the risk of
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compromising the needs of future generations. Environmental sustainability, as described by
Dunphy, Benveniste, Griffiths and Sutton (2000), places emphasis on how business can achieve
positive economic outcomes without doing any harm, in the short- or long-term, to the
environment. According to Dunphy et al. (2000) an environmentally sustainable business seeks to
integrate all four sustainability pillars, and to reach this aim each one needs to be treated equally.
The principle of the four pillars of sustainability states that for complete sustainability problems to
be solved in relation to all four pillars of sustainability and then need be maintained. Although in
some cases these may overlap, it is important to identify the specific type of green business to focus
on, as the four types present unique characteristics. Businesses need to make a strategic decision
about it so as to effectively incorporate the chosen approach into their policies and procedures.
4.2 The five principles of sustainable development are as follows:
1. Conservation of the ecosystem or the environment.

2. Conservation of biodiversity of the planet
3. Sustainable development of the society
4. Conservation of human resources
5. Population control and management
4.3 Ethiopia Natural Resources
Ethiopia has abundant natural resources, such as land, minerals, and gas. Gold, copper, potash,
platinum, and natural gas lie beneath the surface of the earth in this part of the world, and in
2012, mining reportedly contributed US $500 million to the country‘s economy. But mining is
still a small contributor.
There is a need to make better use of the natural resources in Ethiopia. Soil degradation and
erosion are both issues, as is deforestation. About 30% of Ethiopia used to be forested and now
less than 5% of the country is forest. The forests have been almost completely destroyed
because people needed the land for cultivation and grazing and they needed the wood for
construction and/or fuel. Since most people rely on burning fuel to do their cooking, they now
need to use things that would normally improve the quality of the soil, such as dung. These
problems feed one another and present big challenges to those trying to improve and protect
Ethiopia‘s natural resources.
Water is an important natural resource. Ethiopia has 12 river basins that give the potential for
irrigation and hydropower. (Hydropower is the only source of power in the country.) However,
when rainfall is low or non-existent, rivers can dry up, threatening crops and taking away the only
source of electricity.
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In the Afar Region, salt is a big natural resource. The Afar people have been mining salt for
countless years and it provides a source of revenue for them. The salt is taken from the earth and
transported by camel and donkey to be sold. Salt is so important in Ethiopia that blocks of salt used
to be used as money all over the country!
The country has a few known reserves of precious metals and other natural resources such as gold,
potash, natural gas, copper, and platinum. In addition to all these resources, there is also an
extensive potential for the generation of hydropower.
However, the most abundant natural resource is arguably natural gas. Explorations in the past have
shown that Ethiopia has some of the largest deposits of natural gas compared to most countries in
Africa. Despite all this potential, natural gas has not been properly exploited yet. The potential is so
high that the geology of some parts of the country, like that of the Ogaden basin, resembles the
natural gas-rich geological structures of oil and gas fields in the Middle East.
In addition to the above resources, Ethiopia also engages in a bit of agriculture. As things stand,
about 20% is being exploited for agricultural use even though the potential is higher. Forests have
greatly reduced with only about 10 to 15% of the land covered by forests. Livestock keeping is also
popular with huge swathes of land used for pasture.
4.3.1 Plans to Utilize Ethiopia's Natural Resources
In recent years, the Ethiopian government has taken progressive steps to ensure that the valuable
resource does not go untapped for much longer. For instance, a plan has been prepared that, if
fulfilled, would see the extensive exploitation of the resource by 2023. The idea is to turn the sector
into a crucial cog of the Ethiopian economy by then. Some of the strategies put in place to ensure
the goal is reached include inviting more private investors to the country and the issuance of
licenses to parties interested in the mining sector. The Ethiopian Petroleum Development
Enterprise was established in 2012 to oversee the achievement of the set targets. Plenty of firms
have already acquired the necessary permits to explore the vast deposits of gas and associated
liquids.
4.3.2 Natural Resource Management in Ethiopia
In Ethiopia, People in Need promotes a holistic Natural Resource Management (NRM) approach to
allow communities of the target kebeles to actively implement long-term measures for the
rehabilitation and protection of communal and individually managed lands, and to enable
sustainable development of the livelihoods of local households.
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The climate is changing; these days it is more visible than any time before. The reasons are many.
But in Ethiopia, we can claim that one of the important ones was the deforestation which occurred
from the 1960s to 1980s. During these years, Ethiopia basically lost 70% of its forests‘ coverage,
mostly due to the needs of the growing population. This resulted in problems such as a disturbed
landscape, massive erosion, a loss of productive soil, and famines. Trees which were used to help in
reducing carbon dioxide and the effects of global warming and climate change were gone.
In July 2019, we witnessed how the world was amazed but also puzzled by a massive afforestation
campaign in Ethiopia, which claimed that more than 350 million trees were planted within a day.
Back then, many initiatives were started to address how to afforest Ethiopia again to prevent
climate change from impacting the largest segment of the Ethiopian economy– rainfed agriculture,
on which most people depend.
4.3.3 NRM intervention
In July 2019, we witnessed how the world was amazed but also puzzled by a massive afforestation
campaign in Ethiopia, which claimed that more than 350 million trees were planted within a day.
Despite the fact that this number is hard to verify, the effort should be appreciated. It is however
necessary to mention that this campaign wasn't anything new to Ethiopia. It was only the marketing
product of long-term NRM interventions which have been implemented in Ethiopia for decades.
PIN, as part of these initiatives, is implementing a project in the Dijo-Bilate watershed, Alaba. It is
an area prone to recurring natural disasters, resource degradation and climate change. The root
cause of problems in the area is flooding. Floods occur every year in multiple kebeles, affecting
people's lives, damaging road access to schools and hospitals, and also worsening erosion and
agricultural productivity.
PIN has applied a holistic NRM approach which has proved to be very appreciated after showing
positive results in just a few years. The core of the project was to create landscape management
maps (LMPs) for particular kebeles, showing the whole watershed and the necessary intervention
places. For Ethiopians and their agricultural offices, it is a great tool to be used for strategic
planning, as in the past this was done largely by using estimates. Now, based on the LMPs, those
responsible are able to see the degraded areas, slopes, and erosion gullies and to plan NRM
interventions accordingly. To put it simply, the government is well aware of the problems and the
NRM work being done yearly during ―watershed campaigns‖. But due to insufficient knowledge
and the complex picture of the watersheds, these efforts very often failed.
PIN also provides trainings for DAs (development agents) who are the people responsible for the
implementation and monitoring of NRM measures in villages. They are taught technical
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information about land degradation and anti-erosion structures, as well as about the importance of
planning and cross-border cooperation across the watershed, as it is a natural structure and doesn´t
respect administrative borders. Through DAs, farmers are also educated and held responsible for
maintaining the structures‘ functionality.
A new element introduced in 2018 in the Alaba project was soil classification. This has never been
taken into account during the implementation of similar NRM projects, even though the soil type
matters especially when implementing physical structures, which used to be the core of NRM
projects. Vertisols, heavy black soils, were introduced. These soils have the tendency of moving
and cracking during the season and thus they damage physical structures. As a side effect, lots of
money has been saved, as the physical structures (gabion boxes) are among the most expensive
items in NRM budgets.
It is not only about planting trees. Trees must be planted in well pre-selected areas, and different
species must be planted as they can better cope with diseases and balance the soil nutrients. Other
variables such as the soil quality, soil type, slopes, ridges, waterways and overall the geography of
the whole watershed must be taken into account.
The grass and seedlings production in district or village nurseries is also supported. Seedlings are
prepared for the coming year to be planted on newly selected degraded land based on LMPs. The
diversity of the species is stressed. Roots of seedlings and grasses also support the physical
structures. Within the holistic approach, some parts of the degraded area are closed to prevent the
entrance of livestock and subsequent overgrazing. Instead, people are educated and provided with
grass seeds to prevent open grazing and feed animals with their own resources, practising the so-
called ―cut and carry‖ system.
Within a short period of time (2-3 years) it is possible to see the first impacts of the work. Affected
places are green, trees have grown to several metres, and areas are full of grass. As a result of that,
there are springs and tree species re-occurring in these areas. Such places are also attractive for
wild animals, which are returning. Areas are more humid, groundwater is recharged and the green
mass is able to absorb more carbon dioxide.
Three principles behind the success
This project can be called successful. It stands on three main principles:
a) Holistic approach,
b) Technical support and
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c) Education of people.
Remembering the 2019 campaign and the 350 million trees planted, this is not unusual or anything
new to Ethiopia, as many similar initiatives are happening all over the country. It is all possible
thanks to the joined effort of people, the government and many NGOs.
There are, however, a few important things to be stressed. It is not only about planting trees. Trees
must be planted in well pre-selected areas, and different species must be planted as they can better
cope with diseases and balance the soil nutrients. Other variables such as the soil quality, soil type,
slopes, ridges, waterways and overall the geography of the whole watershed must be taken into
account. Land must be protected not only by biological measures but also by physical ones which
should support each other, especially if we talk about such extensive degradation as has happened
in Ethiopia. Farmers know their land more than anyone else, and we should listen to them when we
are planning NRM interventions. However, they should be also educated in new technical
principles as this can help them better understand the work and make them qualified to continue by
themselves once the project is over.
So Ethiopia, move ahead, is an inspiration for other countries. On your way to a green and resilient
future, please bear in mind that quality is preferred to quantity.
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COURSE 2: GENDER AND DEVELOPMENT
UNIT ONE
GENDER AND DEVELOPMNET: AN INTRODUCTION
Gender and development are so fluid terms that they do not have a one-fits-all definition that works
consistently under all socio-economic and political settings. As a result, various definitions have been
provided for gender and development. In this section, we will introduce you to some selected
definitions of each term and/or concept separately. You will also learn how the concepts embedded in
the definitionsof gender and development inherently relate to oneanother.
―Gender refers to the economic, social and cultural attributes and opportunitiesassociated with
being male or female at a particular point in time‖ (World Health Organization, 2001).
Gender refers to the array of socially constructed roles and relationships, personality traits, attitudes,
behaviors, values, relative power and influence that society ascribes to the two sexes on a differential
basis. …. Gender is relational and refers not simply to women or men but to the relationship between
them.
‗Development‘, like ‗gender‘, isoverloaded with a variety of definitions and multitude of explanations.
We hope that, from your previous courses from Governance and Development Studies, you would
recall that the subject of development is one of the most complex subjects in academics in general and
in social sciences in particular.
To begin with, Dudley seers (1977) identifies, ‗…the questions to ask about a country‘s development
are three: ‗What has been happening to poverty? What has been happening to unemployment? What
has been happening to inequality?‘ If all three of these have declined from high levels, then beyond
doubt this has been a period of development for the country concerned.‘ (Seers, 1977:3)
Gender issues in development arise where an instance of gender inequality is recognized as

undesirable, or unjust. Three aspects of gender issues which are raised in development are gender gap,
gender discrimination and women‘s empowerment. This arose out of the general conviction that
women have been more impoverished, have enjoyed limited access to means of income and have
occupied a much more marginalized position as compared to men.
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Findings of multitudes of researches indicate that women have historically benefited less and little from
the fruits of development and they are generally poorer than men. In the next section, you will see how
women have been differently, and marginally, benefit from development and how this has put them at a
disadvantaged position in society.
Development is also defined as a social ingredient measured as well-being in health, education,

housing and employment. In this regard, it is evidenced that women suffer more from poor health, low
level of education, greater unemployment, and poorer access to housing services and its ownership than
men.
Dichotomizing development into rural-urban distinction, Robert Chambers (1983) defines rural
development as, ‗…a strategy to enable a specific group of people, poor rural women and men, to gain
for themselves and their children more of what they want and need. It involves helping the poorest
among those who seek a livelihood in the rural areas to demand and control more of the benefits of
development.‘ (Chambers, 1983:147)
Currently, sustainability issues are the principal concerns of development. It has been globally, hence
conventionally, recognized that the exiting pattern of economic growth favors the rich and the current
generation at the expense of the poor and the future generations. It is also agreed that the current
pattern of growth favors men at the expense of women. Rephrasing the Brudtland (1987) definition of
sustainable development, development implies a commitment to ecologically sound and socially
desirable economic growth where the consumption of the present generation does not undermine the
interests of the future generations. In view of this, sustainable development considers two equity
dimensions: intra-generational and inter-generational. Intra-generational equity is concerned with
existing inequalities and inequities. It involves the inequalities and inequities that persist between the
rich and the poor, the north and the south, the developed and the developing world, and above all, the
inequalities and inequities that subsist between men and women. Inter-generational equity is concerned
with potential inequalities that affect the future generations. As Meadows (1992) argues, if the current
pattern of development is sustained, it will eventually overshoot and exceed the shouldering capacity of
the earth. This has a tendency to borrow resources from the future generations (from our children),
which weakens their capacity to meet their deeds, and hence undermine inter-generational equity. And
if the condition continues unaddressed, it is feared that the current inequity trends would restore and
exacerbate future inequalities and inequities that would make the position of women worse off from
now.
Since the mid1980s there has been a growing consensus that sustainable development requires an
understanding ofboth women‘s and men‘s roles and responsibilities within the community and their
relations to each other. This hascome to be known as the Gender and Development (GAD) approach.
Improving the status of women in society then came to be no longerseen as just a women‘s issue, but as
a goal that requires the active participation of both men and women.
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1 The Heydays of Gender in the Development Discourse
In the past four to five decades, there has been growing acceptance of the gender-focused approach to
development. Gender training and gender analysis are now considered essential tools in the
development process. Gender equity was a foundation for the Program of Action of the International
Conference on Population and Development in 1994 and in the Fourth World Conference on Women
in 1995. The Fourth World Conference on Women reviewed its precursor‘s progress, Nairobi
Conference (1985) that celebrated the International Women‘s Decade (1975-1985), and it came up with
the ‗Beijing Platform for Action‘. The most important areas of concern identified under the ‗Beijing
Platform for Action‘ are outlined below. All actors (governments, the international community and
civil society, including nongovernmental organizations and the private sector) are called upon to
observe and take strategic actions in the following critical areas of concern:
 The persistent and increasing burden of poverty on women;

 Inequalities and inadequacies in and unequal access to education and training;
 Inequalities and inadequacies in and unequal access to health care and related services;
 Violence against women;
 The effects of armed or other kinds of conflict on women, including those living underforeign
occupation;
 Inequality in economic structures and policies, in all forms of productive activities and in
access to resources;
 Inequality between men and women in the sharing of power and decision-making at all levels;
 Insufficient mechanisms at all levels to promote the advancement of women;
 Lack of respect for and inadequate promotion and protection of the human rights of Women;
 Stereotyping of women and inequality in women's access to and participation in all
communication systems, especially in the media;
 Gender inequalities in the management of natural resources and in the safeguarding of the
environment; and
 Persistent discrimination against and violation of the rights of the girl child.
2.2 Why is gender a development issue: the rationale?
There are both pushing and pulling factors to panel gender issues into the development agenda. The
pushing factors refer to past trends and socio-economic conditions regarding the relationship between
men and women and the resultant disadvantaged position of women in society. The pulling factors are
current problems that need to be addressed so that future challenges of gender inequality would be
anticipated. These pushing and pulling factors are multiple, complex and interdependent development
problems. They constitute the rationale for integrating gender into development policies and programs.
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Some of the major factors that bring on gender into development are outlined as follows:
Population composition: population census results of any country report that women constitute
slightly more than 50% of a nation‘s population. A healthy development thus cannot bypass half of its
population. But women constitute 2/3rd of the world poor. Women also make up 2/3rd of the world
illiterate.
Women‟s poverty: more than one billion people in the world live in unacceptable condition of
poverty. The great majority of these impoverished people are women. Women constitute more than
70% of the world poor, and the trend in the poverty of women is increasing as compared to the number
of men. This has led to what has been coined as the problem of ‗feminization of poverty‘, particularly
in developing countries. Reducing women‘s poverty is part of the Millennium Development Goals.
Women‟s workload: reports indicate that women perform about 67% (2/3rd) of the world‘s work.
Those women from developing countries pass 17 hours a day at work. But women earn less than 10%
of the world income and women own only about 1% of the world property.
Women produce food for both women and men: women produce about 50% of the food consumed
by the world population every day. Women are however the most vulnerable group of societies to
hunger and starvation. Women thus face nutritional and related health problems.
Women and health: women have different and unequal access to and use of basic health resources.
Discrimination against girls, often resulting from ―son preference‖, in access to nutrition and healthcare
services endangers their current and future health and well-being. Conditions (traditions, poverty and
illiteracy) that force girls into early marriage, pregnancy and child-bearing subject them to harmful
practices, such as female genital mutilations, pose grave health risks.
Violence against women: sexual and gender-based violence, including physical and psychological
abuses, trafficking of women and girls, rape and other sexual exploitations, and other forms of abuses
and harassments put girls and women under harsh risk of physical and mental trauma, diseases and
unwanted pregnancy. Some groups of women, such as women belonging to minority groups,
indigenous women, refugees, migrants and expatriates (=migrant workers and forced dislocations),
remote rural, women under detention, disabilities, elderly women, repatriates, women participating in
armed conflicts, wars aggression, civil wars, terrorism and hostage-takings are all vulnerable to
violence. Violence against women is obstacle to equality, development and peace.
Women‟s human rights: all forms of gender violence or violence against women involve violations of
women‘s human rights. Violence against women impairs and nullifies the enjoyment of women of their
human rights and fundamental freedoms.
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Women and the environment: women play as crucial, or even more important, roles as men in the
achievement ofsustainable development objectives. In other words, women, like men, are important to
foster the realization of environmentally friendly and socially desirable development. However, women
remain largely absent at all levels of decision-making and policy formulations in natural resources and
environmental management. The experiences of women in the conservation and rehabilitation of
natural resources as well as their skills in advocacy for environmental protection have often remained
marginalized. But equitable socio-economic development that recognizes empowering women to
utilize environmental resources is a necessary foundation for sustainable development.
Existing knowledge gap: there has been lack ofscientific studiesand adequate information about and
interest in the situation of women. Hence, women‘s and gender studies came into the scene to provide
academic support and reliable data on the situation of women.
Urgent need to criticize gender blindness of disciplines: historically, there existed gender blindness
in almost all disciplines. This has negatively affected the interests of women in education and the
knowledge that could have been generated otherwise for use and change.
Urgent need to challenge traditional monolithic assumptions about women and sexual division of
labor: socially constructed roles and responsibilities of women have resulted in a disadvantaged
position of women in society. There is an urgent to criticize and transform the existing gender roles and
sexual division of labor.
Policy implications: gender concerns are important for policy analysts and development planners.
From poverty issues to women‘s human rights, gender issues need to be mainstreamed into gender-
sensitive and gender-transformative development policies and programs.
2.3.Gender and Economic Growth
There are various ways by which gender and economic growth are interrelated. This can be direct or
indirect. On the one hand, participation of women directly affects economic growth and development.
Women, like men, contribute to development through their labor, knowledge and skills. A society also
directly benefits where there are equitable benefits-sharing and participative decision-making processes
in development. On the other hand, one of the defining characteristics of development and economic
growth is the effect of population growth. Fertility and mortality are key issues closely linked to
women and population growth. This can be said indirect.
Education and population growth are interrelated issues as fertility and mortality are linked closely
with awareness and knowledge. There are a large number of studies that link gender inequality in
education to fertility and child mortality. A research finding shows that females with more than 7 years
of education have, on average, two fewer children in Africa than women with no education. Such
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writers as King and Hill (1995) find a similar effect of female schooling on fertility. Over and above
this direct effect, lower gender inequalityin enrollment has an additional negative effecton fertility rate.
Countries with a female-male enrollment ratio of less than 0.42 have, on average, 0.5 more children
than countries where the enrollment ratio is larger than 0.42 (in addition to the direct impact of female
enrollment on fertility). Similar linkages have been found between gender inequality in education and
child mortality. Thus reduced gender bias in education furthers two very important development goals,
namely reduced fertility and child mortality.
The place of gender in economic growth can also be seen from the perspective of education and
knowledge. In this regard, there are some models that consider gender inequality in education and its
impact on economic growth. It is argued that initial gender inequality in education can lead to a self-
perpetuating equilibrium of continued gender inequality in education, with the consequences of high
fertility, higher population growth rate and low economic growth. Various research findings conclude
that gender inequality in education may generate a poverty trap with self-perpetuating gender gaps in
education. Barro and Lee (1994) and Barro and Sala-i-Martin (1995) suggest that a large gap in male
and female schooling may signify backwardness and may, therefore, be associated with lower
economic growth. Conversely, too, Hill and King (1995) relate levelsof GDP to gender inequality in
education. They find that a low female-male enrollment ratiois associated with a lower level of GDP
per capita, over and above, the impact of levelsof female education on GDP per capita. They find that
female secondary education achievement (measured as the share of the adult population that have
achieved some secondary education) is positively associated with growth, but it turns out that in
countries with low female education, furthering female education does not promote economic growth,
while in countries with higher female education levels, promoting female education has a sizeable and
significant positive impact on economic growth.
UNIT TWO
KEY CONCEPTS AND ISSUES IN GENDER AND DEVELOPMENT
1.1 Sex and Gender compared
The English-language distinction between the terms, ‗sex‘ and ‗gender‘ was first developed in the
1950s and 1960s by British and American psychiatrists and other medical personnel working with
intersexes and transsexual patients. Since then, the term gender has been increasingly used to
distinguish between sex as biological and gender as socially and culturally constructed phenomenon.
Feminists have used this terminology to argue against the ‗biology is destiny‘ line, and gender and
development approaches have widely adopted this system of analysis.
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Sex=gender?
―Sex marks the distinction between women and men as a result of their biological, physical and
genetic differences…Gender roles are set by convention and other social, economic, political and
cultural forces‖
(One World Action Glossary: http://owa.netxtra.net/indepth/project.jsp?project=206)
Whilst often used interchangeably, „sex‟ and „gender‟ are in fact distinct terms. „Sex‟: a person‘s sex is
biologically determined as female or male according to certain identifiable physical features which are
fixed. Whereas biological sex is determined by genetic and anatomicalcharacteristics, gender is an
acquired identitythat is learned, changes over time, and varies widely within and across cultures. From
this perspective, sex is fixed and based in nature; gender is fluid and based in culture. This distinction
constitutes progress compared with ‗biology is destiny‘, that is, nature determines one‘s class, status
and life outcomes.
Whereas sex refers to the biological differences between women and men that generally tends to be
permanent and universal,gender refers to the socially constructed roles and responsibilities of women
and men in a given culture or location. These roles are influenced by perceptions and expectations
arising from cultural, political, environmental, economic, social, and religious factors, as well as
custom, law, class, ethnicity, and individual or institutional bias. Gender attitudes and behaviors are
learned and can be changed.Section-two: Patriarchy
2.1 What is patriarchy?
Patriarchy literally means the ―rule of the father‖. A theoretically countervailing term to patriarchy is
matriarchy. Matriarchy is the ―rule of the mother‖. ‗A patriarchy‘ is a society in which formal power
over public decisions and policy-making is held by adult men; ‗a matriarchy‘ is a society in which
policy is made by adult women (Ruth, 1995). Closely related terms to patriarchy and matriarchy are
patria-lineal and matrilineal as well as patria-local and ‗matrilocal‘. Patria-lineal societies are societies
in which decent is traced through males (father‘s bloodline) and patria-local is a condition where
domicile after marriage is with husband‘s family. Matrilineal societies are societies in which decent in
traced through females (mother‘s bloodline) and matrilocal is a condition where domicile after
marriage is with the wife‘s family.
Feminists use the term patriarchy to denote a culture that embodies masculine ideals and practices.
What do you think is masculinity? Feminists refer to masculinity as those behaviors and attributes
socially perceived to characterize maleness. This attributes include: aggressiveness, courage, physical
strength and health, self-control and emotional reserve, perseverance and endurance, competence and
rationality, self-reliance and autonomy, individuality, sexual potency. There are also parallel attributes
associated with femininity, that is, what constitutes femaleness. These attributes include: passivity,
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timidity, fragility and delicacy, expressiveness, frailty, emotionality, needfulness, dependence,
humility, chastity/innocence or receptivity and hospitability).
Another related concept to patriarchy is patriarchal ideology. Patriarchal ideology is a system of ideas
based on a belief in male superiority and sometimes the claim that gender division of labor is based on
biology and scriptures.
The most problematic aspect of patriarchy is its invisibility in society. Some people regard patriarchy
as ―…an elephant in the room‖. Patriarchy is an issue that almost all people are aware of but which is
never addressed directly by those involved with social inequality and public policy. Despite the
inconceivable injustices done to women, people of either sex hardly consider it as a serious problem.
Because it operates under a mind-control serving instruments, patriarchy becomes an invisible reality
in which people unconsciously engage. Patriarchy operates as the most potent form of control that
reigns not just over the body but essentially over the mind. It works as a brainwashing instrument that
perpetuates the most stable and effective form of slavery where the salves were unaware of their
condition, unaware that they were controlled, and instead believing that they have freely chosen their
life condition, here femininity and its trappings. As a result some women even acted side by side with
men in the control of women by patriarchy. Women have very often supported the patriarchal status
quo; they have backed men, and instructed their daughters and granddaughters in the duties of being
and becoming ‗good girls‖ and women of character. With the same token, patriarchy is a vividly
observable reality but people have consciously undermined it, making it a consciously entrenched
system unconsciously exercised and vice-versa. However, because its impact is so huge on society, it
cannot also be overlooked in a conscious world of enlightened and responsible citizens.
Patriarchy has made women and men to move into and live in two different conceptual universes of the
same world wherein they absorb (learn, grow and act) two separate images of the same reality. Women
and men had long come to see the world systems and themselves differently. Patriarchy‘s powerful
agencies of idea formation and worldview creation are religion and belief systems, environment and
philosophies, education and curriculum, and social science and the media.
Patriarchy generally meant that there is male domination of ownership and control, at all levels in
society, which maintains and operates the system of gender discrimination as justified by the
patriarchal ideology. Patriarchy has maintained control over women and over the institutions that guide
the political, economic and cultural arrangements governing the lives of women. Patriarchal institutions
are, therefore, regarded as central causes of social and material inequalities in male-dominated
societies. While it is commonplace to discuss the impact of gender inequality on women and girls, and
while it is also becoming very common to discuss its impact on men and boys, its general impact on all
public policy is least discussed and considered. However, patriarchal masculinity is almost globally
dominant, and that this dominance is reflected in unhealthy and anti-social patterns of socialization
which affect most if not all children and adults in almost all societies worldwide.
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2.2 Hegemonic masculinity
Masculinities are the range of alternative ways (national, social, racial, sexual) in which male gender
relations are expressed. Hegemonic masculinity is the form of masculinity which is culturally and
politically dominant at a particular time and place. What do we mean by hegemony? Hegemony is a
subtle and complex process whereby particular beliefs, values and ideologies are reinforced by those
with political and cultural power such that they become perceived as both natural and inevitable.
Hegemony in this sense entails that there is no alternative and no other better ways to think and act.
Hegemonic assertions superimpose the dominance of an institution or ideology over any other rival
under its domain. This results in social inequality. Social inequality refers to unfair or unjust
differences in the determinants or outcomes of social utilities (including health and education) within
or between defined populations. This might lead to structural violence. Structural violence is sufferings
caused by public policies and institutions. Such structural relations include civil, social and economic
relations of public policy.
Hegemonic masculinity refers to a specific form of gender relations that has for many years remained
globally dominant. It is one of the variant of masculinity which is characterized by generally agreed
upon negative and positive attributes associated with what is constituted in maleness. Dear learner, the
table below presents lists of these masculine attributes.
Perceived positive attributes of

Perceived negative attributes of
Contested attributes
masculinity masculinity
Strength Toughness Individualism
Protectiveness Aggressiveness Competitiveness
Decisiveness excessive risk-taking Rationality
Courage suppression of emotions Practicality
What is specially worrying about the hegemonic dominance of this form of masculinity is the fact that
worldwide acceptance of childhood socialization into the above negative features of the hegemonic
masculinity subsequently results in power inequalities between individuals, between social/racial/
gender groups and between institutions and in turn in the individual and the structural violence through
which power inequalities are expressed in public policies.
Generally, the fact that the patriarchal institution socializes boys and girls to the world of differing
gender perceptions and expectations has resulted in gender stereotypes.
Section-three: Gender Roles and Gender Division of Labor
3.1 Gender roles
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Gender roles are the activities ascribed to men and women on the basis of perceived differences.
―Gender division of labor‖ is a term used in gender literature to mean the roles and tasks assigned to
women and men on the basis of perceived gender characteristics and attributes, irrespective of ability
and skills.While one‘s sex does not change, gender roles are learned and change over time. They vary
from culture to culture, and often from one social group to another or within the same culture. Gender
roles vary according to class, ethnicity, and race. For example, in India, unskilled labor is considered
―women‘s work‖ while in Africa it is ―men‘s work.‖ In Europe and the United States, the contribution
men make to domestic activities is becoming increasingly important and visible. Factors such as
education, technology, economy, and sudden crises like war and famine also cause gender roles to
change from time to time across cultures and within the same culture and sex-class.
Gender is a basic organizing principle of societies, particularly in the division of labor in families,
communities, and the marketplace. Although gender roles limit both women and men, they generally
have had a more repressive impact on women. Women frequently have responsibilities related to their
reproductive roles (child bearing and child rearing) and the associated tasks such as managing the
family and the household. Both women and men are involved in productive labor, which includes wage
employment and production of goods. However, their functions and responsibilities differ. Women‘s
productive work is typically less visible and lower paid than men‘s. In some cases, work done
primarily by men would immediately turn to low-pay-jobs and less prestigious when women begin to
do it, and conversely, ―women‘s work‖ earns higher pay when done by men. Similarly, women
frequently earn less than men in the same job. At the community level, men may tend to have formal
leadership roles and perform high-status tasks while women often do the organizing and support work.
Most women‘s development projects also fail to recognize the triple roles of women, and focus only on
women‘s reproductive work as caregivers to children and families.
What do you think are the major spheres of life where gender differences are reflected?
Dear learner, the following are major sphere of life where gender differences are reflected.
Social Different perceptions of women‘s and men‘s social roles: the man seen as head of the
household and chief bread-winner; the woman seen as nurturer and care-giver.
Political Differences in the ways in which women and men assume and share power and
authority: men more involved in national- and higher-level politics; women more
involved at the local level in activities linked to their domestic roles.
Educational Differences in educational opportunities and expectations of girls and boys: family
resources directed to boy‘s rather than girl‘s education; girls streamed into less-
challenging academic tracks.
Economic Differences in women‘s and men‘s access to lucrative careers and control of financial
and other productive resources: credit and loans; land ownership.
From those occupations and preoccupations of men and women, it if possible to conclude that:
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… many of the activities that consume women‘s time—cooking, childcare, cleaning—are not
considered ―work‖ because they do not involve earning an income. Women‘s time is therefore
considered less valuable than men‘s because they may not earn cash. When women are involved
in earning income for the family, they generally continue to have all the additional
responsibilities within the home. The perception of women‘s activities as not being valuable and
women‘s limited ability to earn an income result in women having less power in the family and
the community. …women‘s triple roles: reproductive, productive, and community [are always the
case in point]. (The CEDPA Training Manual Series Volume III, 1996)
3.1.1 The triple roles of women

Because women are active in all three types of labor (reproductive, productive, and community), they
are said to have ―triple roles.‖
i) Reproductive roles: refer to child-bearing and child rearing and related responsibilities
fulfilled by women. They include pregnancy, giving birth to a child, breast-feeding and
associated roles of women such as raising children, caring for other family members, and
household management tasks, as well as home based production.
ii) Productive roles: refer to production of goods for consumption or income through work in
or outside the home.
iii) Community management: refers to tasks and responsibilities carried out for the benefit of
the community.
Women are expected to balance the demands of these three different roles and hence they should be
recognized for their contributions. The tasks women usually perform in carrying out their different
roles do not generally earn them an income. Women are often defined exclusively in terms of their
reproductive roles, which largely concern activities associated with their reproductive functions. These
reproductive roles, together with their community management roles, are perceived as natural. But
because these roles do not earn income, they are not recognized and valued as economically
productive. Women‘s contributions to national economic development are, therefore, often not
quantified and hence invisible.In many societies, women also carry out productive activities such as
maintaining smallholder agricultural plots in farming systems. These tasks are often not considered as
work and are often unpaid. Women may also perform many roles which attract wages in both the
formal and informal economic sectors. But women‘s economically productive roles, in contrast to
men‘s, are often undervalued or given relatively little recognition.
3.2 Gender division of labor
Gender division of labor is defined as the socially determined ideas and practices which define what
roles and activities are deemed appropriate for women and men. Whilst the gender division of labor
tends to be seen as natural and immutable, in fact, these ideas and practices are socially constructed.
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This results in context-specific patterns of who does what by gender (=gender roles) and how this is
valued.
Gender divisions of labor are not necessarily rigidly defined in terms of men‘s and women‘s roles.
They are also characterized by co-operation in joint activities, as well as by separation. Often, the
accepted norm regarding gender divisions varies from the actual practice. However, roles typically
designated as female are almost invariably less valued than those designated as male. Women are
generally expected to fulfill the reproductive roles. Men tend to be more associated with productive
roles, particularly paid work, and market production. In the labor market, although women‘s overall
participation rates are rising, they tend to be confined to a relatively narrow range of occupations or
concentrated in lower grades than men, usually earning less.
Both women and men engage in productive roles. But what do you think is the problem with women‘s
productive roles? Historically, women‘s productive roles have been ignored and under-valued,
particularly in the informal sector and subsistence agriculture. This has led to misconceived
development projects. For example, the services of extension agents and agricultural inputs being
targeted at men. Because women‘s labor is undervalued, it is often assumed by mainstream
development policies to be infinitely elastic. For example, policy makers expect that women can take
on roles previously fulfilled by public services, such as care for the sick and elderly, when cutbacks are
made.
Women‘s productive roles could be better recognized and gender-sensitive development interventions
be promoted if the following conditions are fulfilled. These are:
 Formal documentation and recognition of women‘s roles and the related time burden‘
 Measure all forms of economic activity by gender. International organizations have already
begun to implement it.
 Redefinition of ‗economic activities‘ that include subsistence farming, food processing and
home-working ‗in anticipation of profit‘.
 Employing time-budget-surveys to measure women‘s input into reproductive work.
 Gender and development policies and programs can challenge and a change woman‘s socially
prescribed roles in pursuit of gender equity.
 Training women and employing them in jobs previously under males‘ domain. They may
include water technicians, builders, etc.
 Establishing proper remuneration for programs aiming to increase women‘s participation in

spheres beyond the household.
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 Reduction of women‘s responsibilities in the home increased cooperation of men.
Gender discrimination
4.1 Gender discrimination
―Not all women are poor, and not all poor people are women, but all women suffer from
discrimination‖ (Kabeer, 1996:20)
Gender discrimination refers to the systematic, unfavorable treatment of individuals on the basis of
their gender, which denies those rights, opportunities or resources. Across the world, women are
treated unequally and less value is placed on their lives because of their gender. Women‘s differential
access to power and control of resources is central to this discrimination in all institutional spheres, i.e.
the household, community, market, and state.
Within the household, women and girls can face discrimination in the sharing out of household
resources including food, sometimes leading to higher malnutrition and mortality indicators for
women. This is termed as intra-household resource allocation. At its most extreme case, gender
discrimination can lead to ‗son-preference‘, expressed in ‗sex-selective-abortion‘ or female feticide. In
the labor market, unequal pay, occupational exclusion or segregation into low skill and low paid work
limit women‘s earnings in comparison to those of men of similar education levels. Women‘s lack of
representation and voice in decision-making bodies in the community and the state perpetuates
discrimination, in terms of access to public services, such as schooling and health care or
discriminatory laws. The law is assumed to be gender-neutral when in fact it may perpetuate gender
discrimination, being a product of a culture with oppressive gender ideologies. Even where
constitutional or national legal provisions uphold gender equality principles, religious or other
customary laws that privilege men may take precedence in practice. However, the law, when reformed
with women‘s input, can be a potent or powerful tool for challenging discrimination, if combined with
other strategies, including capacity-building to overcome barriers to claiming rights. Dear learner, the
box below provides some figures and facts about women revealing the distribution of resources by
gender at the global level.
Gender discrimination:
 women work more than 67% of the world‘s working hours;

 women (particularly those in developing countries) work for about 17 hours a day;
 women produce about 50% of the world food;
 women‘s earnings range from 50-85% of men‘s earnings ; or women earn less than 10% of
the world income;
 2 out of 3 of the world‘s illiterate people are women;
 2 out of 3 of the world‘s poor are women;
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 Women own only about 1% of the world property;
 globally women make up just over 10% of representatives in national government;
The Convention on the Elimination of all forms of Discrimination against Women (CEDAW) in 1979
brought into international focus the rights of women as human rights, including the right to be free
from discrimination. Women activists regard this convention as a key tool to support their struggle
against discrimination in all spheres, pushing governments towards attaining these internationally
recognized minimum standards.
Section-five: Gender Equality and Equity
5.1.Gender equality
Gender equality denotes women having the same opportunities in life as men, including the ability to
participate in the public sphere. This expresses a liberal feminist idea that removing discrimination in
opportunities for women allows them to achieve equal status to men. In effect, progress in women‘s
status is measured against a male norm.
Equal opportunity policies and legislations tackle gender equality through measures that increase
women‘s participation in public life. For example, some countries have developed institutions for
National Service for Women (NSW) to set up Equal Opportunities Plans for Women. This focused on
equitable participation in education, the labor market, health services, and politics. Judicial reform is
another key tool in the fight for equality, but lack of implementation and enforcement might limit its
impact.
The focus on what is sometimes called formal equality, does not necessarily demand or ensure equality
of outcomes. It assumes that once the barriers to participation are removed, there is a level-playing
field. It also does not recognize that women‘s reality and experience may be different from men‘s.
5.2.Gender equity
Gender equity denotes the equivalence in life outcomes for women and men, recognizing their different
needs and interests, and requiring a redistribution of power and resources. The goal of gender equity,
sometimes called substantive equality, moves beyond equality of opportunity. It requires a more
transformative change. It recognizes that women and men have different needs, preferences, and
interests and that equality of outcomes may necessitate different treatment of men and women.
An equity approach implies that all development policies and interventions need to be scrutinized for
their impact on gender relations. It necessitates a rethinking of policies and programs to take account of
men‘s and women‘s different realities and interests. So, for example, it implies rethinking existing
legislation on employment, as well as development programs, to take account of women‘s reproductive
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work and their concentration in unprotected, casual work in informal and home-based enterprises. It is
worth examining the content of policies, not just the language, before deciding whether equity or an
equality approach is being followed. Gender equity goals are seen as being more political than gender
equality goals.
Most development specialists agree that sustainable development is not possible without the full
participation of both halves, female and male, of the world‘s population. Development policies that
incorporate gender as a factor reflect a growing understanding of the necessity for women‘s and men‘s
full and equal participation in civil, cultural, economic, political, and social life. Gender-focused
development means that female and male infants are given equal opportunities to survive; boys and
girls are equally nourished and educated; and women and men have equal opportunities to contribute to
and benefit from social, economic, and political processes. With equity, women and men will enjoy full
and equal legal rights and access to and control over resources. Together, women and men can
participate in building more equitable, secure, and sustainable societies. Two international conferences,
the first on population and development in Cairo (1994), and the second, on women in Beijing (1995)
laid the foundation for incorporating gender equality and gender equity in development. They state:
Advancing gender equality and equity and the empowerment of women...are cornerstones of
population and development related programmes...The full and equal participation of women in
civil, cultural, economic, political and social life, at the national regional and international
levels, and the eradication of all forms of discrimination on grounds of sex, are priority
objectives of the international community (International Conference on Population and
Development, 1994).
Equality between women and men is a matter of human rights and a condition for social justice
and is also a necessary and fundamental prerequisite for equality, development and peace. A
transformed partnership based on equality between women and men is a condition for people-
centered sustainable development (The Fourth World Conference on Women, 1995).
Section III: Gender mainstreaming
3.1 Definitions and conceptual overview of gender mainstreaming

The commonly accepted and most widely used definition of gender mainstreaming is the one adopted
by the United Nations‘ Economic and Social Council: ―Mainstreaming a gender perspective is the
process of assessing the implications for women and men of any planned action, including legislation,
policies or programmes, in all areas and at all levels. It is a strategy for making women‘s as well as
men‘s concerns and experiences an integral dimension of the design, implementation, monitoring and
evaluation of policies and programs in all political, economic and societal spheres so that women and
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men benefit equally and inequality is not perpetuated. The ultimate goal is to achieve gender equality.‖
(UN ECOSOC, 1997)
Similarly, the Commonwealth Secretariat (Leo-Rhynie et al 1999: 9) defines gender mainstreaming as

the consistent use of a gender perspective at all stages of the development and implementation of
policies, plans, programmes and projects. It involves:
 bringing about institutional change to ensure the empowerment of both women and men
through equal participation in decision-making on issues which affect their lives
 analyzing all government policies and practices to examine the differential impact they have on
men and women
 Providing training and capacity-building to enhance gender management and raise the general
level of gender awareness.
Gender mainstreaming is a flexible strategy that accommodates mainstreaming women into all
projects, women-specific components, and separate projects and programmes directed exclusively at
women.
A
According to UNDP, gender mainstreaming is a process of identifying and taking full account of the
relationships between men and women in all of an agency‘s policies, strategies, programs,
administrative and financial activities at every level. Gender mainstreaming offers a dynamic way of
determining and enhancing development potential of both women and men and identifying constraints
that each faces, and it entails:
 Being informed of the gender characteristics of a given population;

 Taking full account of this information in the development of policy and program activities;
 Appraising all program documentation in the light of known gender information;
 Consistent monitoring of all activities to ensure equitable gender outcomes.
Gender mainstreaming includes both the issue of equality and mainstream. Mainstreaming includes
gender specific activities and affirmative action, whenever women or men are at a particular
disadvantageous position. Gender-specific intervention can target women exclusively, men and women
together, or only men, to enable them to participate in and benefit equally from development efforts.
These are necessary temporary measures designed to combat the direct and indirect consequences of
past discrimination.
Mainstreaming is not adding ‗women‘s component‘ or even a ‗gender equality component‘ in to an

existing activity. It goes beyond increasing women‘s participation; it means bringing the experience,
knowledge, and interests of women and men to bear on the development agenda. It may require
changes in goals, strategies and actions so that both men and women can influence, participate in, and
benefit from development processes. The goal of mainstreaming gender equality is thus the
transformation of unequal social and institutional structures in to equal and just structure for both men
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and women.Gender mainstreaming was adopted as a major strategy for promoting gender equality at
the Fourth World Conference of Women in 1995. It called for mainstreaming in all ‗Critical Areas of
Concern‘ at the conference which included poverty, human rights, economy, violence against women
and armed conflict. In addition, the Beijing Platform for Action established that gender analysis should
be undertaken on the respective situation and contributions of both women and men before undertaking
development policies and programs.
The inclusion of a goal on gender equality and the empowerment of women in the MDGs re-
established the commitment voiced in Beijing. In addition, in outlining the way forward toward
achieving that goal, the report of the Task Force on Education and Gender Equality of the UN
Millennium Project reinforced the importance of investing in gender mainstreaming as a tool and
reiterated (repeated) the need to expedite (accelerate) mainstreaming responses and actions and put in
place the systems to hold institutions accountable.
This is especially important now because the United Nations (UN) Millennium Development Goals
(MDG), especially MDG3 on gender equality and the empowerment of women, offer an invaluable
opportunity to reinvigorate efforts to achieve positive development outcomes. Besides, the vast body of
experience and knowledge gained over the past three decades on what works and what doesn‘t in
development interventions across different sectors is available to be applied to make greater and more
rapid progress on mainstreaming gender into operations. As results emerge and development
effectiveness improves from mainstreaming gender, it is believed that the success and growing
experience will generate additional interest, learning and enthusiasm, and the process will gather
momentum. Changes at the operations level will also improve the lives of women and men, the purpose
for which gender mainstreaming was adopted. Concrete results in terms of increased development
effectiveness constitute a way forward in the current impasse with gender mainstreaming and will
make important and growing contributions towards achieving the wider institutional goals of
empowerment and equality for low-income and disenfranchised people that are not currently being
met.
Gender mainstreaming is a powerful new development in feminist theory and practice. While most
frequently understood as a specialized tool of a policy world, it is also a feminist strategy that draws on
and can inform feminist theory. It is an international phenomenon, originating in development policies,
and adopted by the UN at the 1995 conference of Women in Beijing (Walby, 2003)
Gender mainstreaming was adopted mainly to address the perceived failure of previous strategies such
as women-specific projects to bring about significant changes in women‘s status. There was
widespread consensus that the failures of women-specific projects in the 1970s and 1980s were due to
their marginalization. Gender mainstreaming was designed to overcome this marginalization and to
bring gender equality issues into the core of development activities. In the decade since gender
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mainstreaming was endorsed and adopted by countries and institutions, however, it has yet to be fully
implemented anywhere.
The primary objective behind gender mainstreaming is to design and implement development projects,
programs and policies that;
1. Do not reinforce existing gender inequalities (gender neutral)

2. Attempt to redress existing gender inequalities (gender sensitive)
3. Attempt to redefine women and men‘s gender roles and relations (gender
positive/transformative)
3.2 Steps in Gender Mainstreaming
The 10 Steps for Gender Mainstreaminginclude:
1. A mainstreaming approach to stakeholders: who are the decision makers?

This stepconcerns the project and policy making context. The actors involved in the process, along
with their values and understanding of gender issues, will significantly determine the outcome of your
policy or project. During step one you should seek answers to the following three key questions:
 Who are the stakeholders? Do they include individuals or groups with a ―gender perspective‖?
 Is there gender balance in all institutions and bodies involved?
 Where is gender expertise available?
2. Mainstreaming a gender agenda: What is the issue?

During this step, you should first identify the main development problem or issue at hand. This can be
accomplished by answering the following basic questions:
 What is the subject of your project or policy-making initiative?
 Does this issue affect men and women in different ways?
UNIT THREE
FEMINISM, FEMINIST THEORIES AND DEVELOPMENT

Feminist perspectives of the last five decades are grouped into three broad categories that reflect their
theories and political strategies with regard to the gendered social order. These are gender reform
feminisms, gender resistant feminisms, and gender revolution feminisms. Feminist theories are also
classified into white feminism, black feminism, and feminism in developing countries based on
geographic and ethnic criteria. In this unit, you will learn about these theories with particular focus on
gender reform, gender resistant and gender revolution feminisms. Each category is broad and
consists of sub-divisions.
Section one:Gender Reform Feminisms

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The feminisms of the 1960s and 1970s were the beginning of the second wave of feminism.
 They are liberal feminism,
 Marxist and socialist feminisms, and
 Development feminism.
The roots of liberal feminism were 18th and 19th century liberal political philosophy that developed the
idea of individual rights while Marxist and Socialist feminisms were fundamentally established on the
Marx's 19th century critiques of capitalism and his concept of class consciousness in class analysis.
Development feminism was essentially linked to the 20th century anti-colonial politics and ideas of
national development.
Liberal feminist politics took important weapons of the civil rights movement anti-discrimination
legislation and affirmative action, and used them to fight gender inequality, especially in the job
market. Affirmative action calls for aggressively seeking out qualified people to redress the gender and
ethnic imbalance in work places. That means encouraging men to train for such jobs as nursing,
teaching, and secretary, and women for fields like engineering, construction, and police work. With a
diverse pool of qualified applicants, employers can be legally mandated to hire enough different
workers to achieve a reasonable balance in their workforce, and to pay them the same and also give an
equal chance to advance in their careers.
The main contribution of liberal feminism is showing how much modern society discriminates
against women. In the United States, it was successful in breaking down many barriers to women's
entry into formerly male-dominated jobs and professions, helped to equalize wage scales, and got
abortion and other reproductive rights legalized. But liberal feminism could not overcome the
prevailing belief that women and men are intrinsically different. It was somewhat more successful in
proving that even if women are different from men, they are not inferior.
1.2 Marxist and Socialist Feminisms

Marx's analysis of the social structure of capitalism was supposed to apply to people of any social
characteristics. If you owned the means of production, you were a member of the capitalist class; if you
sold your labor for a wage, you were a member of the working class for the capitalists. That would be
true of women as well, except that until the end of the 19th century, married women in capitalist
countries were not allowed to own property in their own name; their profits from any businesses they
ran and their wages belonged to their husband. Although Marx recognized that workers and capitalists
had wives who worked in the home and took care of the children, he had no place for housewives in his
analysis of capitalism.
It was Marxist feminism that put housewives into the structure of capitalism, and not Karl Marx.
Housewives are vital to capitalism, indeed to any industrial economy, because their unpaid work in the
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home maintains bosses and workers and reproduces the next generation of bosses and workers (and
their future wives as well). Furthermore, if a bourgeois husband (one who owns means of production,
or just a member of industry owning class) falls on hard times, his wife can do genteel (refined or
proper) work in the home, such as dressmaking, to earn extra money, or take a temporary or part-time
job, usually white collar. And when a worker's wages fall below the level needed to feed his family, as
it often does, his wife can go out to work for wages in factories or shops or other people's homes, or
turn the home into a small factory and put everyone, sometimes including the children, to work.
The housewife's labor, paid and unpaid, is for her family. Marxist and socialist feminisms severely
criticize the family as a source of women's oppression and exploitation. If a woman works for her
family in the home, she has to be supported, and so she is economically dependent on the "man of the
house," like her children. If she works outside the home, she is still expected to fulfill her domestic
duties, and so she ends up working twice as hard as a man, and usually for a lot less pay.
This source of gender inequality has been somewhat redressed in countries that give all mothers paid
leavebefore and after the birth of a child and that provide affordablechild care. But those solutions
put the burden of children totally on the mother, and encourage men to either consciously or
unconsciously exit out of family responsibilities altogether. To counteract that trend, feminists in the
government of Norway allocated a certain portion of paid-child-care-leave to fathers specifically.
Women in the former communist countries had what liberal feminism in capitalist economies always
wanted for women, that is, full-time jobs with state-supported maternity leave and child-care services.
But Marxist and socialist feminists claim that the welfare state can be paternalistic, substituting public
patriarchy for private patriarchy. They argue that male-dominated government policies put the state's
interests before those of women. When the economy needs workers, the state may pay for child-care
leave, and with a down-turn in the economy, the state reduces the benefits. Similarly, when the state
needs women to have more children, it cuts back on abortions and contraceptive services. Women's
status as a reserve army of labor and as a child producer is thus no different under socialism than under
capitalism. The solution of women's economic dependence on men thus cannot simply be waged work,
especially if jobs continue to be gender-segregated and women's work is paid less than men's.
Socialist feminism had a different solution to the gendered workforce than liberal feminism's program
of affirmative action. In examining the reasons why women and men workers' salaries are so
discrepant, proponents of comparable worth found that wage scales are not set by the market for labor,
by what a worker is worth to an employer, or by the worker's education or other credentials. Salaries
are set by conventional "worth," which is rooted in gender and ethnic and other forms of
discrimination. Comparable worth programs compare jobs in traditional women's occupations, such as
secretary, with traditional men's jobs, such as automobile mechanic. They give a point values for
qualifications needed, skills used, extent of responsibility and authority over other workers, and
dangerousness. Salaries are then equalized for jobs with a similar number of points (which represent
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the "worth" of the job). Although comparable worth programs do not do away with gendered job
segregation, feminist proponents argue that raising the salaries of women who do the traditional
women's jobs could give the majority of women economic resources that would make them less
dependent on marriage or state benefits as a means of survival.
1.3 Development Feminism
Development feminism has done extensive gender analysis of the global economy. They argue that the
gendered division of labor in developing countries is the outcome of a long history of colonialism.
Under colonialism, women's traditional contributions to food production were undermined in favor of
exportable crops, such as coffee, and the extraction of raw materials, such as minerals. Men workers
were favored in this work, but they were paid barely enough for their own subsistence. Women family
members had to provide food for themselves and their children, but with good land confiscated for
plantations, they also lived at a bare survival level. As a result, they argue, women workers in
developing countries (Central and Latin America, the Caribbean, and Africa) were paid less than men
workers, whether they work in factories or at home. To survive in rural communities, women grow
food, keep house, and earn money any way they can to supplement what their migrating husbands send
them.
Development feminism made an important theoretical contribution in equating women's status with
control of economic resources. In some societies, women control significant economic resources and so
have a high status. In contrast, in societies with patriarchal family structures where anything women
produce, including children, belongs to the husband, women and girls have a low value. Development
feminism's theory is that in any society, if the food women produce is the main way the group is fed,
and women also control the distribution of any surplus they produce, women have power and prestige.
If men provide most of the food and distribute the surplus, women's status is low. Whether women or
men produce most of the food depends on the kind of technology used. Thus, the mode of production
and the kinship rules that control the distribution of any surplus is the significant determinants of the
relative status of women and men in any society. In addition to gendered economic analyses,
development feminism addresses the political issue of women's rights versus national and cultural
traditions. At the United Nations Fourth World Conference on Women Forum held in Beijing in 1995,
the popular slogan was "human rights are women's rights and women's rights are human rights." The
Platform for Action document that came out of the UN Conference condemned particular cultural
practices that are oppressive to women. Such practices include: infanticide, dowry, child-marriage
(early marriage), and female genital mutilation. The 187 governments that signed onto the Beijing
Platform for Action agreed to abolish these practices.
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However, since they are integral parts of cultural and tribal traditions, to give them up at a time could
be seen as kowtowing to Western ideas. The development feminist perspective, so critical of
colonialism and yet so supportive of women's rights, has found this issue difficult to resolve. Western
ideas of individualism and economic independence are double-faced. On the one hand, these ideas
support the rights of girls and women to an education that will allow them to be economically
independent. They are also the source of a concept of universal human rights that can be used to fight
subordinating and sometimes physically hurtful tribal practices, such as genital mutilation. On the other
hand, Western ideas may weaken communal enterprises and traditional reciprocal food production and
shared child care. Indigenous women's own solution to this dilemma is community organizing around
their productive and reproductive roles as mothers so that what benefits them economically and
physically is in the service of their families, not themselves alone. However, this same community
organizing and family service can support the continuance of cultural practices like female genital
mutilation, which Western development feminists want to see eradicated. The decision to not interfere
with traditional cultural practices that are physically harmful to girls, and at the same time, that works
for their education and better health care are a particularly problematic dilemma for development
feminism.
Section two:Gender Resistant Feminisms
As gender reform feminisms made their way into the public consciousness in the 1970s and women
entered formerly all-men workplaces and schools, they became more and more aware of constant and
everyday put-downs, from bosses and colleagues at work, professors and students in the classroom,
fellow organizers in political movements, and worst of all, from boyfriends and husbands at home.
These "micro-inequities" of everyday life, being ignored and interrupted, not getting credit for
competence or good performance, being passed over for jobs that involve taking charge, crystallize into
a pattern that insidiously wears women down. Out of this awareness that ‗sisters had no place in any
brotherhood‘ came the gender resistant feminisms of the 1970's. They are radical feminism, lesbian
feminism, psychoanalyticalfeminism, and standpoint feminism.
Section two:Gender Resistant Feminisms
As gender reform feminisms made their way into the public consciousness in the 1970s and women
entered formerly all-men workplaces and schools, they became more and more aware of constant and
everyday put-downs, from bosses and colleagues at work, professors and students in the classroom,
fellow organizers in political movements, and worst of all, from boyfriends and husbands at home.
These "micro-inequities" of everyday life, being ignored and interrupted, not getting credit for
competence or good performance, being passed over for jobs that involve taking charge, crystallize into
a pattern that insidiously wears women down. Out of this awareness that ‗sisters had no place in any
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brotherhood‘ came the gender resistant feminisms of the 1970's. They are radical feminism, lesbian
feminism, psychoanalyticalfeminism, and standpoint feminism.
2.2.Psychoanalytic Feminism
Another important gender resistant feminism of the 1970s and 1980s came out of feminist re-readings
of Freud and the French feminist engagement with Lacan, Derrida, and Foucault. Freud's theory of
personality development centers on the Oedipus complex- the detachment from the mother.
Psychoanalytic feminism claims that the source of men's domination of women is men's unconscious
two-sided need for women's emotionality and rejection of them as potential castrators. Women submit
to men because of their unconscious desires for emotional connectedness. These gendered personalities
are the outcome of the Oedipus complex- the separation from the mother. Because women are the
primary parents, infants bond with them. Boys, however, have to separate from their mothers and
identify with their fathers in order to establish their masculinity. They develop strong ego boundaries
and a capacity for the independent action, objectivity, and rational thinking so valued in most cultures.
Women are a threat to their independence and masculine sexuality. Girls continue to identify with their
mothers, and so they grow up with fluid ego boundaries that make them sensitive, empathic, emotional.
It is these qualities that make them potentially good mothers, and keep them open to men's emotional
needs. But because the men in their lives have developed personalities that make them emotionally
guarded, women want to have children to bond with. Thus, psychological gendering of children is
continually reproduced.
To develop nurturing capabilities in men, and to break the cycle of the reproduction of gendered
personality structures, psychoanalytic feminisms recommend shared-parenting, after men are taught
how to parent. French psychoanalytic feminism focuses on the ways that cultural productions (novels,
drama, art, opera, music, movies) reflect and represent the masculine unconscious, especially fear of
castration. In French feminist psychoanalytic theory, patriarchal culture is the sublimation of men's
suppressed infantile desire for the mother and fear of the loss of the phallus, the symbol of masculine
difference. Since women don't have a phallus to lose and are not different from their mothers, they can't
participate in the creation of the culture. Women's wish for a phallus and repressed sexual desire for
their fathers is sublimated into wanting to give birth to a son; men's repressed sexual desire for their
mother and fear of the father's castration are sublimated into cultural creations. What women represent
in phallic culture is the sexual desire and emotionality men must repress in order to become like their
fathers, men who are controlled and controlling. No matter what role women play in cultural
productions, the male gaze sees them as desired or despised sexualized objects. Phallic cultural
productions, according to psychoanalytic feminism, are full of aggression, competition, and
domination, with an underlying misogynist subtext of fear of castration – of becoming a woman. To
resist and to counter with woman centeredness, French feminism called for women to write from their
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biographical experiences and their bodies, about menstruation, pregnancy, childbirth, and sexuality.
That way, women can resist their suppression by the dominant phallic culture. However, urging women
to produce woman-centered art and literature locks them into a categorically female sensibility and
emphasizes their difference from men and the dominant culture even more. Women's emotional and
erotic power is unleashed and made visible in women's cultural productions, but they are separated
from men's culture, which is still dominant.
2.3.Standpoint Feminism
Radical, lesbian, and psychoanalytic feminist theories of women's oppression converge in standpoint
feminism, which turns from resistance to confrontation with the dominant sources of knowledge and
values. The main idea among all the gender resistant feminisms is that women and women's
perspectives should be central to knowledge, culture, and politics, not invisible or marginal. Whoever
sets the agendas for scientific research, whoever shapes the content of education, whoever chooses the
symbols that permeate cultural productions has hegemonic power. Hegemonyis the ideology that
legitimates a society's unquestioned assumptions. In Western societies where the justifications for
many of the ideas about women and men largely come from science, as they believe in scientific
"facts" and rarely question their objectivity, Standpoint feminism emerges as a critique of mainstream
science and social science, a methodology for feminist research, and an analysis of the power that lies
in producing knowledge. Simply put, standpoint feminism says that women's "voices" are different
from men's, and they must be heard if women are to challenge hegemonic values. Men do not
recognize that the knowledge they produce and the concepts they use come out of their own
experience. Rather, they claim that their scientific work is universal, general, neutral, and objective.
But women know that it is partial, particular, masculine, and subjective because they see the world
from a different angle, and they have been excluded from much of science. The grounding for
standpoint theory comes from Marxist and socialist feminist theory, which applies Marx's concept of
―class consciousness‖ to women, and psychoanalytic feminist theory, which describes the gendering
of the unconscious. Standpoint feminism argues that as physical and social reproducers of children -
out of bodies, emotions, thought, and sheer physical labor, women are grounded in material reality in
ways that men are not. Because they are closely connected to their bodies and their emotions, women's
unconscious as well as conscious view of the world is unitary and concrete. If women produced
knowledge, it would be much more in touch with the everyday, material world, and with the
connectedness among people. Although men could certainly do research on and about women, and
women on men, standpoint feminism argues that women researchers are more sensitive to how women
see problems and set priorities, and therefore would be better able to design and conduct research from
a woman's point of view.
Unquestionably,women do privilege to women's experience. But is all women's experience is not the
same. The "facts" produced from a woman's perspective are also just as biased as those produced from
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a man's point of view. Donna Haraway (1998) says that all knowledge is situated, just as standpoint
feminism claims, but situations differ, and so do all perspectives.
Section three: Gender Revolution Feminisms
The 1980s and 1990s have seen the emergence of feminist theories that attack the dominant social
order through questioning the clearness of the categories that comprise its hierarchies. These feminisms
deconstruct the interlocking structures of power and privilege that make one group of men dominant,
and range everyone else in a complex ladder of increasing disadvantage.
They also analyze how cultural productions, especially in the mass media, justify and normalize
inequality and subordinating practices. These feminisms thus have the revolutionary potential of
destabilizing the structure and values of the dominant social order.
 They are multi-ethnic feminism,
 Social constructionfeminism,
 Post-modern feminism and queer theory.
3.1 Multi-ethnic Feminism
Throughout the 20th century, social critics have argued that no one aspect of inequality is more
important than any other. Ethnicity, religion, social class, and gender comprise a complex hierarchical
stratification system in which upper-class, heterosexual, white men andwomen oppress lower-class
women andmen of disadvantaged ethnicities and religions. In teasing out the multiple strands of
oppression and exploitation, multi-ethnic feminism has shown that gender, ethnicity, religion, and
social class are structurally intertwined relationships. Ethnicity, religion, social class, and gender are
the walls and windows of our lives, they structure what we experience, do, feel, see, and ultimately
believe about ourselves and others. As a writer points out in a comment on standpoint theory
("Comment on Hekman's 'Truth and Method: Feminist Standpoint Theory Revisited': Where's the
Power?", 1997), these experiences are not individual, but belong to groups; thus they are a vital source
of both a world view and a sense of identity. The important point made by multi-ethnic feminism is
that the subordinate group is not marked just by gender or by ethnicity or religion, but is in a social
location in multiple systems ofdomination. Men are as oppressed as women, but men and women of
disadvantaged groups are often oppressed in different ways. For example, in the United States, Black
men are punished for their masculinity and Black women are seen as sexual objects or mothers. Thus,
group consciousness reflects all social statuses at once.
Multi-ethnic cultural feminism finds art in what women of every culture produce in everyday life:
quilts, folk songs, celebratory dances, festive food, decorated dishes, weaving and embroidery
(needlework) are all part of a vibrant women's culture. These women's modes of art and literature are
interactive and emotionally expressive. They are the equivalent of men's subversive cultural
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productions, such as jazz and rap, and equally distinctive from the dominant group's way of talking and
thinking. A woman of a disadvantaged ethnic group may not feel loyalty or identity with "all women."
But she may also feel alienated from the men of her own group, if they are oppressive to women
because of a traditional patriarchal culture or because they are themselves subordinated by men at the
top of the pyramid.
3.1 Social Construction Feminism
While multi-ethnic feminism focuses on the effects of location in a system of advantage and
disadvantage, and men's feminism on the hierarchical relationships of men to other men and to women,
social construction feminism looks at the structure of the gendered social order as a whole. It sees
gender as a ―society-wide-institution‖ that is built into all the major social organizations of society. As
a social institution, gender determines the distribution of power, privileges, and economic resources.
Gendered norms and expectations get built into women's and men's sense of self as a certain kind of
human being, and alternative ways of acting and arranging work and family life are literally
unthinkable. In social construction feminist theory, inequality is the core of gender itself: Women and
men are socially differentiated in order to justify treating them unequally. Thus, although gender is
intertwined with other unequal statuses, remedying the gendered part of these structures of inequality
may be the most difficult, because gendering is so pervasive. Indeed, it is this pervasiveness that leads
so many people to believe that gendering is biological, and therefore "natural." Social construction
feminism focuses on the processes that create gender differences and also on what renders the
construction of gender invisible. The common social processes that encourage us to see gender
differences and to ignore continuums are the gendered division of labor in the home that allocates child
care and housework to women; gender segregation and gender typing of occupations so that women
and men don't do the same kind of work; re-gendering (as when an occupation goes from men's work
to women's work and is justified both ways by "natural" masculine and feminine characteristics);
selective comparisons that ignore similarities, as in men's and women's separate sports competitions;
and containment, suppression, and erasure of gender-inappropriate behaviors and appearances, such as
aggressiveness in women and nurturance in men. Social construction feminism argues that the
dichotomies of male and female biological sex and physiology are also produced and maintained by
social processes. Genital and hormonal ambiguities are ignored or overridden in the sex categorization
of infants; and the gendering of sports and physical labor ignores the overlaps in female and male
stature and musculature. In the social construction feminist perspective, the processes of gender
differentiation, approval of accepted gendered behavior and appearance, and disapproval of deviations
from established norms are all manifestations of power and social control. Religion, the law, and
medicine reinforce the boundary lines between women and men and suppress gender variation through
moral censure and stigmatization, such as labeling gender-inappropriate behavior sinful, illegal, and
insane.
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Social construction feminism also analyzes the historical and cultural context in which sexuality is
learned and enacted, or "scripted." What sexual behaviors are approved, tolerated, and tabooed differs
for women and men and varies for social groups over time and place. Sexuality, in this perspective, is a
product of learning, social pressures, and cultural values. Legal penalties, job loss, and violence uphold
the heterosexual social order, defeating individual attempts at resistance and rebellion. Most people,
however, voluntarily go along with their society's prescriptions for those of their gender status, because
the norms and expectations get built into their individual sense of worth and identity. Even
transvestites(males who dress in women's clothes and females who dress in men's clothes) and
transsexuals (people who have sex-change surgery) try to pass as "normal" men and women. So male
―cross-dressers‖ tend to wear very feminine-looking clothing, and male transsexuals use hormones to
grow breasts.
In the social construction feminist view, long-lasting change of this deeply gendered social order would
have to mean a conscious re-ordering of the gendered division of labor in the family and at work, and
at the same time, undermining the taken-for-granted assumptions about the capabilities of women and
men that justify the status quo. Such change is unlikely to come about unless the pervasiveness of the
social institution of gender and its social construction are openly challenged. Since the processes of
gendering include making them invisible, where are we to start? Is that with individual awareness and
attitude change? Or is that with restructuring social institutions and behavioral change? Certainly, both
individuals and institutions need to be altered to achieve gender equality, but it may be impossible to
do both at once.
Social construction feminism is faced with a political dilemma. If political activities focus on getting
individuals to understand the constrictions of gender norms and expectations and encourage resistance
to them in every aspect of their lives, it would not necessarily change social structure. If the focus is on
getting work organizations and governments to structure for gender equality, it would not necessarily
change gendered norms for individuals. The dilemma is built into the theory of social construction,
individuals construct and maintain the norms and expectations and patterns of behavior that become
institutionalized, but existing institutions constrain the extent of allowable variation and individual and
group difference. Socially patterned individual actions and institutional structures construct and
reinforce each other. For this reason, social construction feminism recognizes that there is always
change, but it is usually slow.
3.1 Postmodern Feminism and Queer Theory
Post-modern feminism and queer theory go the furthest in challenging gender categories as dual,
oppositional, and fixed, arguing instead that sexuality and gender are shifting, fluid and multiple
categories. They critique a politics based on a universal category, woman, presenting instead a more
subversive view that undermines the solidity of a social order built on concepts of two sexes, two
sexualities, and two genders. Equality will come, they say, when there are so many recognized sexes,
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sexualities, and genders that one can't be played against the other. Postmodern feminism and queer
theory examine the ways societies justify the beliefs about gender at any time (now and in the past)
with ideological "discourses" embedded in cultural representations or "texts." Not just art, literature,
and the mass media, but anything produced by a social group, including newspapers, political
pronouncements, and religious liturgy, is a "text." A text's "discourse" is what it says, what it doesn't
say, and what it hints at (sometimes called a "sub-text"). The historical and social context and the
material conditions under which a text is produced become part of the text's discourse. If a movie or
newspaper is produced in a time of conservative values or under a repressive political regime, its
"discourse" is going to be different from what is produced during times of openness or social change.
Who provides the money, who does the creative work, and who oversees the managerial side all
influence what a text conveys to its audience. The projected audience also shapes any text, although the
actual audience may read quite different meanings from those intended by the producers.
"Deconstruction" is the process of teasing out all of these aspects of a "text."
Queer theory goes beyond cultural productions to examine the discourses of gender and sexuality in
everyday life as texts ripe for deconstruction. In queer theory, gender and sexuality are "performances",
identities or selves we create as we act and interact with others. What we wear and how we talk are
signs and displays of gender and sexual orientation. What we do socially creates us as women and men
of a particular ethnic group, social class, occupation, religion, place of residence, even if we try to
create ourselves as individuals. queer theorists often find is that gender roles are recreated in the same
old way, a transvestite passing as a woman wears a demure dress, stockings, and high-heeled shoes; a
butch lesbian swaggers (boastfulness) in men's jeans and cowboy boots. The bearded lady in a skirt still
belongs in a circus, and is stared at openly on the street. Genders and sexualities may be mixed up, but
they are not erased. If social construction feminism puts too much emphasis on institutions and
structures, and not enough on individual actions, postmodern feminism and queer theory have just the
opposite problem. In queer theory, all the emphasis is on agency, impression management, and
presentation of the self in the guise and costume most likely to produce or parody conformity. Social
construction feminism argues that the gendered social order is constantly re-stabilized by the individual
action, but queer theory has shown how individuals can consciously and purposefully create disorder
and gender instability, opening the way to social change. Social construction feminism can show where
the structural contradictions and fault lines are, which would offer places for individuals, organizations,
and social movements to pressure for long-lasting restructuring and a more equal social order for all
kinds of people.
UNIT FOUR
APPROACHES AND STRATEGIES IN GENDER AND DEVELOPMENT
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The political and economic solutions suggested by these theories converge to certain strategies and
approaches that help to address the questions of women as well as men in development. In this unit,
you will learn about gender needs and the women in development (WID), Women and Development
(WAD) and Gender and Development (GAD) approaches.
Section-one: Gender Needs

Different gender roles generate gender needs. These needs are conceived as practical needs and
strategic interests. They are reinforcing strategies to integrate the concerns of women into development
programs and projects. You will learn about these needs and interests in this section.
1.1 Practical Gender Needs (PGN)
Practical gender needs are the needs women identify in their socially accepted roles in society. PGNs
are a response to immediate perceived necessity, identified within a specific context. They are practical
in nature and often concern inadequacies in living conditions such as water provision, health care and
employment. Hence, Practical needs are immediate and material and arise from current conditions.
Women‘s practical needs tend to focus on the domestic arena, income-earning activities, and housing
and basic services, all identified as women‘s responsibilities. Child care services, maternal and child
health care, subsistence crops marketing, and traditional employment opportunities are means to
address these needs.
While practical interventions can increase women‘s participation in the development process, they are
unlikely to change gender relations and, in fact, may preserve and reinforce inequitable divisions of
labor. PGNs do not challenge, although they arise out of gender divisions of labor, women's
subordinate position in society.
1.2 Strategic Gender Needs (SGN)
Strategic Gender Needs (SGN) is also termed as strategic interests of women.Strategic interests are the
needs women identify because of their subordinate position in society. They vary according to
particular contexts, related to gender divisions of labor, power and control, and may include such issues
as legal rights, domestic violence, equal wages, and women's control over their bodies. Meeting SGNs
assists women to achieve greater equality and change existing roles, thereby challenging women's
subordinate position. Strategic interests are long-term, related to equalizing gender-based disparities in
wages, education, employment, and participation in decision-making bodies. Addressing strategic
interests may challenge the prevailing balance of power between men and women. Actions to address
women‘s strategic interests might include abolition of the gender division of labor, shared domestic
labor and child care, elimination of institutionalized forms of discrimination (for example, the right to
own property and access to credit), promotion of political equality, freedom of choice over
childbearing, and adequate measures against male violence.
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Practical needs and strategic interests are linked. Responding to practical needs identified by women at
the community level can provide an entry point to identifying and addressing their long-term strategic
interests. Starting a women‘s group to meet a practical need for child care or income-generation may
improve women‘s economic position and political participation. A community-based reproductive
health project, introduced to meet the practical need for family planning, may enable women to have
greater control over their reproductive lives and have a larger role in decision-making in the family. A
scholarship fund may enable poor girls to attend school, filling a practical need; while adopting and
enforcing laws and policies for equal education addresses a strategic interest.
Section two: WID and GAD Approaches in Development

2.1 Women in Development (WID) and Women and Development (WAD)
WID grew out of the work of economist Ester Boserup, whose groundbreaking book, Women‘s Role in
Economic Development (1970), argued that women‘s contributions were being ignored and
development suffered as a result. The goal was more efficient, effective development through the
integration of women into existing development processes. The strategies that were developed included
adding women‘s projects or project components, increasing women‘s income and productivity, and
improving women‘s ability to look after the household.
The WID approach did not address the root causes of discrimination that prevented women‘s full
participation in their societies. In the late 1970s, the WAD perspective was developed in reaction to
omissions in WID.
WAD proponents argued that women were already integrated into development processes but on
unequal terms. They pointed out that development projects increase the demands on women without
increasing access to resources or decision-making power and, in effect, work against women‘s
interests. WAD argued that class structures were more oppressive than gender and that poor,
marginalized women have more in common with men of their class than with women of another class.
The emergence of GAD in the 1980s marked a revolution in thinking about equitable, sustainable
development.
2.2 Gender and Development (GAD)
The rationale for conducting women‘s development programs began to shift from increased efficiency
in meeting development goals to greater equity and empowerment for women. The new focus on
gender was developed by women who argued that the WID approach saw the problems of women
merely from the perceived sexual divisions their biological differences with men rather than in terms
of gender the social roles and relationships of men and women and the forces that both perpetuate and
change these relations. They pointed out that women have been systematically subordinated and
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assigned secondary or inferior roles to men and their needs have been considered in isolation from the
larger context. GAD reflects the recognition that women are an integral part of every development
strategy. GAD includes three main concepts:
 Both men and women create and maintain society and shape the division of labor. However,
they benefit and suffer unequally. Therefore, greater focus must be placed on women because
they have been more disadvantaged.
 Women and men are socialized differently and often function in different spheres of the
community, although there is interdependence. As a result, they have different priorities and
perspectives. Because of gender roles, men can constrain or expand women‘s options.
 Development affects men and women differently, and women and men will have a different
impact on projects. Both must be involved in identifying problems and solutions if the interests
of the community as a whole are to be furthered.
The GAD approach to development is aimed at ensuring an equal distribution of opportunities,

resources, and benefits to different population groups served by a particular intervention. Applying this
approach can help project planners to identify important differences in female and male roles and
responsibilities and use this information to plan more effective policies, programs, and projects. This
approach is based on the Harvard Analytical Framework, one of the first gender analysis models. GAD
uses this model to explore and analyze the differences between the kinds of work performed by women
and men in particular social, cultural and economic circumstances. In order to identify differences
between female and male roles, responsibilities, opportunities and rewards, the approach requires that
three important questions are asked, explicitly or implicitly, at all stages of designing, planning,
implementing, monitoring and evaluating an intervention:
Who Does What: This question identifies the different activities performed by the men and women in
the target population. For example, a rural development project aimed at cash-cropping might result in
the female population assuming the major burden of the agricultural work, because in such a society
women do most of the agricultural labor. Asking the question ―Who does what?‖ can alert project
designers to the possibility that such a project could increase the women‘s work.
Who Has Access (Ability to Use): This question asks how much each population group can use
existing resources, benefits, and opportunities or those which will be generated by the intervention.
These include land, money, credit, and education.
Who Controls (Determines the Outcome of the Resources): This question asks to what extent
different groups of women and men in the population can decide how to use the available resources.
Some groups may have access to resources but may not be able to use them. If these three questions are
not asked, the kinds of interventions which are developed may be based on incomplete and incorrect
assumptions and perceptions of the way things work in a particular society. For example, planners may
incorrectly assume that in a given setting the men are heads of households and chief decision-makers,
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even though women play this role. This assumption may lead them to design ineffective and
inappropriate interventions. Analysis of the information provided by these questions enables planners
to find out how an intervention would impact different groups. If needed, corrective measures can then
be put in place to ensure that the project will meet the needs of all identified groups equally.
Below is a summary of the WID and GAD approaches to development.
Women in Development Gender and Development
The Approach  An approach which seeks to An approach which seeks to

integrate women into the empower women and transform
development process unequal relations between women
and men
The Focus  Women  Relations between men and women
The Problem  The exclusion of women from the Unequal relations of power (rich and
development process poor/women and men) that prevent
equitable development and women‘s
full participation
The Goal  More efficient, effective Equitable, sustainable development

Development
 Women and men sharing decision-
making and power
The Strategies  Women‘s projects  Identify and address short-term needs

determined by women and men to
 Women‘s components improve their condition
 Integrated projects  At the same time, address women‘s
 Increase women‘s productivity and and men‘s longer term interests
income
 Increase women‘s ability to manage

their households
CHAPTER SIX
CONCEPTUAL OVERVIEW
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1.1 Conceptual overview
The issue of gender inequality can be considered as a universal feature of developing countries. Unlike
women in developed countries who are, in relative terms, economically empowered and have a
powerful voice that demands an audience and positive action, women in developing countries are
generally silent and their voice has been stifled by economic and cultural factors. Economic and
cultural factors, coupled with institutional factors dictate the gender-based division of labor, rights,
responsibilities, opportunities, and access to and control over resources. Education, literacy, access to
media, employment, decision making, among other things, are some of the areas of gender disparity.
The problems of gender inequalities discussed above are very much prevalent in and relevant to
Ethiopia. Ethiopia is a patriarchal society that keeps women in a subordinate position and remains one
of Africa‘s most traditions bound societies. (Haregewoin and Emebet, 2003). There is a belief that
women are docile, submissive, patient, and tolerant of monotonous work and violence, for which
culture is used as a justification (Hirut, 2004).
The socialization process, which determines gender roles, is partly responsible for the subjugation of
women in the country. Ethiopian society is socialized in such a way that girls are held inferior to boys.
In the process of upbringing, boys are expected to learn and become self-reliant, major bread winners,
and responsible in different activities, while girls are brought up to conform, be obedient and
dependent, and specialize in indoor activities like cooking, washing clothes, fetching water, caring for
children, etc. (Haregewoin and Emebet, 2003; Hirut, 2004).
The differences in the ways in which individuals are treated through the socialization process, mainly
due to their sex status, leads to the development of real psychological and personality differences
between males and females (Almaz, 1991). For instance, a female informant in Arsi stated that a man is
a big person who has higher social position and knowledge, who can govern others and think in wider
perspectives; while a woman is a person who can serve a man, who is like the husband‘s object
transferred through marriage, and to whom he can do anything he wishes to do (Hirut, 2004). These
socially induced differences between males and females result in discriminatory rewards, statuses,
opportunities and roles as shall be discussed below.
1.2 Critical areas of gender issues in Ethiopia

a) Poverty and gender
Although women's contribution to their households, food production and national economies is
immense, it has not been translated into better access to resources or decision-making powers. As a
result, women remained to be the poorest of the poor constituting 70% of the global poor. Women in
Ethiopia face similar constraints. Due to the different roles and responsibilities men and women have in
the society, the causes and experiences of poverty also differ by gender. Rights such as, access to land,
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credit and other productive resources are difficult for women to attain. Women make up half of the
population and the majority of the poor and illiterate in the country. Though women play a vital role in
production activities, in addition to shouldering reproductive responsibility, they are denied recognition
and access to resources. Cultural attitudes and harmful traditional practices are major factors which
relegate women to a subordinate position.
Like other least developing countries (LDCs), Ethiopia in 2002 also started the preparation of the final
draft of poverty reduction strategy paper immediately after the approval of the interim poverty
reduction strategy paper. The final document entitled "sustainable Development and Poverty Reduction
Program (SDPRP) provides a sound basis to continue the implementation of the sustainable
development and poverty reduction program activities in the country. Given poverty reduction will
continue to be the core of the agenda of the country's development, the strategy is built on four pillars
(building blocks). These are Agriculture Development led Industrialization (ADLI), Justice System and
Civil Service Reform, Decentralization and Empowerment, and Capacity building in public and private
sectors.
Taking the significance of addressing the gender dimension of poverty into consideration, a lot of
advocacy and lobbying work has been done by the government and Non Government Organization
(NGOs) and other actors to incorporate gender issues in both the interim and final poverty reduction
programs. Efforts have also been done by the Women's Affairs Office of the
Prime Minister Office (WAO/PMO) in terms of advocacy and lobbying the issue to be embedded in the
overall SDPRP. As a result of these and other effort made by various stakeholders, gender and
development has been incorporated as a cross cutting issue in the SDPRP.
b) Violence against women

Violence against women is a general problem in Ethiopia, where culturally based abuses, including
wife beating and marital rape, are pervasive social problems. A July 2005 World Bank study concluded
that 88 percent of rural women and 69 percent of urban women believed their husbands had the right to
beat them. While women had recourse via the police and courts, societal norms and limited
infrastructure prevented many women from seeking legal redress, particularly in rural areas. The
government prosecutes offenders only on a limited scale. The population sex ratio in Ethiopia has been
stable (around 99%) for the past 50 years, and the occurrence of missing women is not widespread in
the country.
Violence against women such as rape, domestic violence, abduction for marriage, sexual harassment,
female genital mutilation, early marriage are widely speared in the country and are being widely
recognized, as a violation of women's right apart from the physical and psychological consequence it
has on the life of a woman. Women in Ethiopia as anywhere else are also victims of various violence
and harmful traditional practices simply because of their gender. Patriarchal domination, cultural and
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traditional practices, economic deprivation etc are among the reasons for violence against women in
Ethiopia.
The practices of female genital mutilation (FGM) and early/and forced marriage, impinge on the rights
and health of women. Traditional discriminatory practices such as FGM and widow inheritance
(including all her property) continue to persist. In Ethiopia, 80% of women (and in some parts of the
country up to 100%) are mutilated, as a means of women‘s loyalty to culture and faith (Haregewoin
and Emebet, 2003). It is also estimated that, in each of the 28 Woredas in Addis Ababa, three women
are raped each day making it a total of 30,660 rape cases every year (Haregewoin and Emebet, 2003).
Data compiled by the Ethiopian Women Lawyers Association from woreda police stations in Addis
Ababa showed a 39% and 54% increment of abduction and assault and bodily injury to women and
young girls between 1999 and 2001 (Federal Civil Service Commission, 2005). The rapid spread of
HIV/AIDS is also posing a serious threat to the development of the country.
Cognizant to this fact, a lot of awareness has been undertaken by various stakeholders including the
WAO/PMO, Sectoral women's affairs machineries, and civil society organizations. FGM is forbidden
according to national law, and is presumed to be declining. The new penal code criminalizes FGM by
imprisonment of no less than three months, or a fine. Likewise, infibulations is punishable by
imprisonment of five to ten years. However, no criminal prosecutions have ever been sought regarding
FGM. Various strategies, including IEC materials, training's/workshops, media campaign (both print
and air), panel discussions, legal aid for women etc were used in this regard. Taking the multi-
dimensional consequences of violence against women into consideration, the government of Ethiopia
has taken measure in creating conducive environment for the revisions of legal reforms that are
discriminatory to women. Accordingly, the family law has been revised in a gender sensitive manner
and the penal code is at stake.
c) Female -headed households
According to the 2004/05 household survey the average household size for the country is 4.8 (4.9 in
rural areas and 4.3 in urban). Of the estimated 13.4 million households, about 75% are male headed
and 25% female-headed. It is estimated that about 16% of households are urban dwellers and 84%
rural. A much higher proportion of female-headed households reside in urban areas compared to rural
areas. About one in five rural households (22%) and nearly two in five urban households (39%) are
female-headed.
d) Women‟s economic participation
The backbone of the economy in Ethiopia is agriculture, which accounts for 54% of the gross domestic
product (GDP) and 60% of exports, and 80% of total employment. The agricultural sector suffers from
frequent drought and poor cultivation practices. Under Ethiopia's land tenure system, the government
owns all land and provides long-term leases to tenants.
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Rural women in Ethiopia engage as equally as their male counterparts in agricultural activities, in
addition to carrying the heavy burden of household duties. Even in areas where women are excluded by
custom from farming and planting, they participate in weeding, transporting harvest and storing grain,
as well as in livestock husbandry activities. In areas where production is based on the use of the hoe
and shift cultivation, women participate in all farm activities including soil preparation. In pastoral
societies, like Afar and Somali, where animal products are the predominant source of income, women
play a critical role in rearing animals and processing animal products for home consumption and the
market.
Women‘s access to land is not only smaller, but they are also disadvantaged in terms of using their
land. This is because their land is often in a worse condition than those used by male-headed
households. This is due to the fact that women do not have the necessary resources to cultivate the
land, which in a lot of cases forces them to rent out their land to others.
Women also lack agricultural labor; this is another reason why they are forced to rent out the land. This
is not necessarily because they are incapable of working on their plot, but because the culturally
accepted gender divisions of labor prohibit women from such activity. For example, in the grain
producing areas of the country social norms prohibit women from farming land (Yigeremew, 2001).
Studies have also revealed that in areas where oxen are essential for farming, such as in plough
agriculture, women do not have enough oxen or the necessary implements to farm their land. Women
also have problem accessing credit because they do not have property for use as collateral. In effect,
this means that they are prevented from improving their land.
e) Gender and Education

Studies have shown that women are seriously disadvantaged regarding educational attainment.
Women‘s education was found to be significantly far behind from that of men. For school age
population the participation or enrolment rates in schools has shown a remarkable increase for both
boys and girls in recent years. However, the gender gap remained to be there. Dropping out after
enrolling for few years is the main obstacle to girls‘ educational attainment. As education of girls and
women is rightly considered to be the key for improving women‘s status at all levels, it is indeed
necessary to explore further what specific factors work against girls‘ education in the society. Factors
affecting educational attainment of girls include early marriage, living in rural areas and poverty (being
in households grouped in lower and poorest wealth quintile groups), etc.
Further exploration of causes for poor educational status of women, by means of qualitative data that
are collected from selected regions in the country, revealed that early marriage is the single most
important reason mentioned in all Focus Group Discussions (FGDs) and interviews with key persons as
to why girls‘ education is undermined in almost all regions. Most cultures strongly urge girls to get
married early and take the responsibility of serving their husbands. The cultural pressure in favor of
early marriage is so strong that families who do not get their daughters married at an acceptably young
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age will be scorned and ridiculed; the girls may also not get husbands if they pass that age. To respect
this tradition, parents continue defying the Constitution that set minimum age of marriage.
Other reasons given for early marriage and dropping out from school were fear of sexual violence, such
as rape and abduction, that befall young girls before marriage and fear of promiscuity and unwanted
pregnancy before marriage on the girls‘ side. Yet another reason mentioned in the FGDs held in
Gambella was the dowry paid to parents of the girl, upon her marriage. Parents do not believe that
girls‘ education is useful and girls are employable. Once married, women will have no time and
permission to go to school. Young girls are also expected to share the work load of their mothers at
home, taking care of their younger siblings and helping in household chores which lead to being absent
regularly and later results in drop out from school. It is also indicated that any financial stress in the
household will lead to pulling girls out of school to cut expenses or involve them in household
maintenance. In most societies girls‘ main role is believed to be learning household activities, cooking,
cleaning, rearing children and taking care of the family as a whole, rather than going to school. It is
believed that educating girls is not that useful as they are going to get married and assume their role
soon anyway. These reasons are shared by almost all rural communities of the country to different
degrees while some are indicated even in urban settings.
Some region-specific, (in Somali, for example), reasons indicated that girls are not allowed in many
cases to attend classes with boys in the same classroom. In addition, the pastoralist lifestyle, which
involves relocating temporary residence and family maintenance, burdens women and girls and leads to
the disruption of girls‘ education (Somali and Afar).
Low educational level is one of the causes and consequences of females‘ low socio-economic status. In
spite of the fact that significant progress has been realized in girls‘ education during the last decade,
gender gap is still observed. According to various statistical abstracts of the Ministry of Education, the
share of female students has increased from 21% to 25% between the years 1998/99 and 2002/03.
Nevertheless, the sex disaggregated Gross Enrolment Ratio (GER), the ratio of total enrolment at
primary or secondary education to the corresponding school age population, shows disparity between
the two sexes. Though female GER in primary education has increased from 41% in 1999/2000 to 54%
in 2002/03, the respective figures for males are 61% and 75%. In the year 2002, the rate of adult
literacy for women was 34%, while it was 49% for men (MOE, 2002). The gender gap is clearly
observed when the Gender Parity Index (GPI), the ratio of female to male enrolment, is considered.
Between the years 1999 and 2003, GPI was found to be 0.7, indicating that there were only 7 girls
enrolled at primary schools for every 10 boys (Federal Civil Service Commission, 2005). The gender
inequality in education widens as one goes up higher in the educational ladder. In the academic year
2001/2002, among the students who managed to enter colleges at diploma level, only 24.9% were
women. This figure goes further down for females in undergraduate and postgraduate degree programs
of various higher education institutes; only 15.0% in undergraduate and 7.3% postgraduate degree
77
programs were females. If one sees the percentage share of females in higher education teaching staff it
is on the average of 5.73% (Emebet, et al, 2004).
One of the strategic objectives and actions in the Beijing Declaration and the Platform of action is
education and training of women. The strategic objective clearly states that education is a human right
and an essential tool for achieving the goals of equality, development and peace. Following the
declaration, Ethiopia has been trying to close the gender gap in education through formulation of
policies, strategies and action oriented measures. The new education and training policy declared in
1994, has addressed the importance of girls education and among others it clearly stated that the
government will give financial support to raise the participation of women in education. It further
stated that, special attention would be given to the participation, recruitment, training and assignment
of female teachers.
f) Women‟s work status

Analysis of the DHS (Disease and Health Survey) data (2005) has shown that employment of women
was significantly less than that of men. The factors identified as positive predictors for women to be
engaged in non- household work were living in urban area, later age at first marriage (above age 18),
having some education and being in a household at a better economic status (indicated by households
in richer and richest wealth quintiles). In rural areas where girls‘ education is discouraged and the role
of a woman is believed to be solely marrying, bearing and raising children and maintaining the family,
tradition and culture do not support women to go out and work for earning. This is believed to be the
role of the man only. According to the FGDs and interviews, it is thought in some societies that letting
women to go out and work for earning could be opening door for them to be unfaithful and
disrespectful to their husbands as it involves interactions and some level of independence. Conforming
to the culture and tradition husbands do not allow women to go out and work; otherwise they will be
considered as deviators from the norm. In addition to this cultural barrier, for the uneducated poor
women economic constraint makes it difficult to start even small scale income generating work. In
many instances having many children coupled with the heavy daily workload at home to maintain the
family does not leave much time to venture working outside. The cultural barriers preventing women
from working to earn a living were strongly stated in Gambella, Somali and SNNP regions.
Women are underrepresented in the formal sector of employment. The survey conducted by the Central
Statistical Authority (CSA, 2004) showed that women account for less than half (43%) of the total
employees in the country. Considering the percentage of female employees from the total number of
employees by employment type, the highest was in domestic activities (78%) and followed by unpaid
activities (59.3%). In other types of formal employment (e.g. government, NGOs, private
organizations), the percentage of female workers is less than 35. On the other hand, the survey showed
overrepresentation of female workers in the informal sector. About 58% of working women work in
the informal sector whereas the percentage of working men in the informal sector was 37.7 % (ibid).
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The breakdown of the federal government employees by occupational groups also indicated gender
disparity. From federal government employees found in the clerical and fiscal type of jobs 71.3 % were
female, while the percentage of females was slightly more than half (51%) in custodial and manual
type of jobs. Women make up 25% and 18% of the administrative and professional and scientific job
categories, respectively, indicating that upper and middle level positions are overwhelmingly
dominated by men (Federal Civil Service Commission, 2005). This concentration of women in the
informal sector and low level positions has implication on their earnings. In this regard, the survey
showed four out of ten women civil servants earn Birr 300 a month compared to two out of ten for men
(Federal Civil Service Commission, 2005).
g) Gender and desire for more children

The research results indicated that men have consistently shown greater desire for having more
children than women. Demand for limiting family size is higher for women than men. On the other
hand, men are the principal if not the sole decision makers regarding controlling fertility of women in
most of the societies particularly in rural areas. Studies revealed that the desire for more children by
men has cultural basis. A man with many children has better prestige since having many children is
considered strengthening the clan one belongs to (Somali, Afar). It is also believed that children will
provide support to their parents at old age. In Gambella, having many children, especially daughters, is
desirable, as they may bring dowry money to parents and are, thus, sources of income. Religion is also
another strong reason for both men and women to consider having many children. Children are
believed to be God‘s gifts. Having many children is considered observing the religion rightly (Somali,
Afar and other regions). Given all these traditional beliefs, women still desire to limit their children
since raising children and family maintenance are their sole burden.
h) Gender and Health

Women‘s health problems, which were formerly conceived as biological and reproductive issues, are
nowadays re-conceptualized to encompass gender issues. This is because reproductive health issues do
not give the full picture of the problem as women‘s health is also embedded in the social and cultural
settings. Accordingly, Yegomawork et al. (2005) classified the health problems into two. The first is
maternal health problems which are directly related to child bearing complications such as prolonged
labor, retained placenta, maternal malnutrition, etc. In this regard, Ethiopia is one of the developing
countries with high Maternal Mortality Ratio (871 deaths per 100,000 live births in 2000) (Mukuria et
al., 2005). Although the MMR has reportedly decreased since then to 673 deaths per 100,000 live
births for the period 2000 to 2005, according to the recent DHS 2005 result, it is still on the higher side.
Similarly, among women aged 15 – 49 and with children under three years, 25% have Body Mass
Index of below 18.5, a cut-off point used to identify chronic energy deficiency (Mukuria et al., 2005).
The authors also stated, according to the categorization of World Health Organization, this percentage
shows a serious nutritional situation in the country
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I) Women and Media
Ethiopian women‘s access to mass media is one of the lowest. In their DHS comparative report,
Mukuria et al. (2005) show that, among 25 Sub-Saharan African countries, Ethiopia was the last with
respect to percentage of women who have access to newspaper. In the same report it was indicated that
in 2000, among women aged 15-49 in Ethiopia, only 1.7% read newspaper at least once a week,
compared with 15% in Uganda, 36% in Gabon and 37% in Namibia. Regarding women‘s access to
television, among the 25 countries, Ethiopia was the second from the last with only 4.4% of women
aged 15-49 watching television at least once a week, surpassing only Malawi (3.8%). Women‘s access
to radio was relatively better than access to newspaper and television, with 11% of the women listening
to radio at least once a week. It is, however, the lowest compared to other sub- Saharan African
countries; 72% for Gabon, 53% for Uganda, 52% for Malawi and 39% for Rwanda.
j) Women in Power and Decision Making

Due to the various obstacles that women have such as triple role, violence against women, lack of
education etc, their representation and participation in leadership and decision making position has also
been limited. Despite the Government policies of equal opportunity for both men and women to
participate in the democratization of the country, women have not been adequately represented at all
levels of decision-making positions.
Out of 547 seats reserved for parliamentarians in 1995, it was only 15(2.74%) that was occupied by
women. However, by the next round election, an increasing trend of women's participation has been
observed. During the 2000 House of People's Representative election, about 42 (7.7%) of the
candidates for parliamentary seats were women compared to 2.7% in 1995. Although not satisfactory,
women participation in local authorities has also improved. With the introduction of a Federal System
of Government, in 1991, by devolution of decision making power and responsibilities to regional
states, an increasing trend of women participation in local authorities have also been seen. During the
1995 general election for regional council, out of 1355 members 77 (5.0%) were women. This number
increased both in terms of membership and number of women in 2000 election. Thus, in the election
held in 2000 for regional council, while the number of members increased to 1647, there were 244
(12.9%) women, which have shown an increase by 10%. At the lowest level of Woreda Council, only
6.6% are women out of the 70,430 council members. At the lowest administrative unit, the Kebele,
women constitute only 13.9% of the 928,288 elected officials.
It is also the case that women have little or no power of making decisions on matters related to their
own households. Their decision making power is limited regarding land use in rural areas (Haregewoin
and Emebet, 2003) and even on sexual interactions (Adanech and Azeb, 1991). Haregewoin and
Emebet noted that less than 25% of women are able to decide by themselves on contraceptive use.
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Mostly women in the country have the power to make decisions on issues related to the daily life of
their family, but decisions about large household purchases, degree of participation of a woman in
social activities, and reproductive health issues are dominated by men.
Further, at the level of international representation, among the 28 ambassadors that Ethiopia appointed
at different mission abroad, only 4 (14.3) are women. In the area of employment, while the number of
women in the Ethiopian civil service has been relatively small, the senior positions are overwhelmingly
held by men. Federal Civil Service Commission recent statistics revealed the fact that the
overwhelming majority of women civil servants are concentrated in positions such as secretary,
cleaner, and others.
Section II: Gender policy and machinery
Since coming to power in 1991, the current government has introduced several laws and policies to
address issues of democracy, decentralization, poverty reduction, institutional capacity and
improvement of the social, economic and political status of the citizenry. Moreover, the Constitution of
the federal government that was proclaimed in 1994 has domesticated international instruments which
Ethiopia has ratified or adopted. Ethiopia has ratified major international conventions, protocols and
treaties.
The issue of gender equality has become an area of concern in development planning during the last
few decades. The marginalization, from development programs, of women for a long period of time is
challenged with changing policy perspectives from Women in Development (WID), which aims to
include women in development projects in order to make the latter more effective, to Gender and
Development (GAD), which aims to address inequalities in women‘s and men‘s social roles in relation
to development (March et al., 1999).
Despite recently introduced policy instruments and legislative commitments serving women‘s interests,
the vast majority of Ethiopian women - particularly in rural areas - are far from being well-off,
independent and direct beneficiaries of development initiatives. Hence, gender mainstreaming, the
integration of gender issues into every aspect of development programs, is aimed at empowering
women to enable them participate in and benefit from the programs equally as men, being supported by
international and national policies.
Global effort had been underway to alleviate the low status of women since the 1990s. In the
framework of the general conferences held in Cairo (1994) and in Beijing (1995), direction was set and
recommendations were made targeting mainly the removal of all the obstacles to gender equalities. The
outcomes of these conferences recognized that the integration of gender issues into the general
development plan and program of a country is crucial and unavoidable step for overall sustainable
development and that needs to get proper attention by governments.
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At international level, the Convention on Elimination of all forms of Discrimination Against Women
(CEDAW), the Beijing Platform for Action (BPA), and the Millennium Development Goals (MDGs)
are the main strategies and conventions introduced for the achievement of gender equality. CEDAW
incorporates the following measures that governments have to take to guarantee gender equality:
elimination of discrimination against women in employment opportunities and benefits of service;
ensuring gender equality in all areas of socio-economic life such as legal rights to contracts and
property, and access to financial credit; equality of women in national constitutions; and abolishing
existing laws, regulations, customs and practices that discriminate against women.
The government urged regional governments to make CEDAW part of the regional law and
encouraged them to proceed with the full implementation of the provisions of the Convention
throughout the country, through the enhancement of cooperation between federal and regional
governmental bodies and institutions, to achieve uniformity of results in the implementation of the
Convention. The Committee assigned by the government also recommended that the State party
improve its efforts to systematically monitor progress achieved in the implementation of the
Convention at all levels, and in all areas. Particular focus being placed on the improvement of the
capacity of all public officials in the area of women's human rights, and the seeking of resources
through international development assistance programmes, as necessary. It was also recommended that
the State party launch, at the national level, a comprehensive programme of dissemination of the
Convention, targeting women and men, in order to enhance awareness and promote and protect the
rights of women. However, CEDAW has not been implemented in regional law, even though the
Constitution encourages it.
According to CEDAW committee report (2003), women in the civil services, the largest employer in
the country, remain a small minority. In the legislative and judiciary branches, the situation is worse.
Women are seriously underrepresented. In the Federal Parliament, the highest decision making body,
women hold only 7.7% of the total seats. The figure sheds light on how far the country has to go in the
direction of empowering women. Especially in this key area, the government has a long way to go. For
without a vigorous effort to level the political playing from a gender perspective, the gap in this area,
critical in measuring women‘s empowerment, will remain wide. The government cannot fully meet its
CEDAW obligations and commitments so long as the political representation gap remains as high as it
is at present.‖
The measures that are included in the BPA are ensuring women‘s equal rights and access to economic
resources; elimination of occupational segregation and all forms of employment discrimination and
promoting women‘s access to employment, appropriate working conditions and control over resources;
facilitating women‘s equal access to markets, trade, information, and technology; promotion of
harmonization of work and family responsibilities for women and men; and conducting gender-based
research and dissemination of its results for planning and evaluation.
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The key commitments of governments and other development partners set in the MDGs include gender
equality and women‘s empowerment. The commitments include ensuring universal primary education
for both boys and girls by 2015; elimination of gender disparity at all levels of education by 2015; and
reducing maternal mortality ratio by three quarters between 1990 and 2015. Ethiopia adopted these
agreements to promote gender equality and improve the lives of women. As a means to implement
these global agreements, different policies and legislations have also been enacted. These are the
National Policy on Women, National Population Policy, Education Policy, Cultural Policy, and other
legal documents.
The National Policy on Women, introduced in 1993, was the first policy that is specifically related to
the affairs of women (Jelaludin et al., 2001). The objectives of the policy include facilitating conditions
conducive to the speeding up of equality between men and women so that women can participate in the
political, economic and social life of their country on equal terms with men; ensuring that their right to
own property as well as their other human rights are respected and that they are not excluded from both
the enjoyment of the fruits of their labor or performing public functions and participating in decision
making.
Cognizant of the adverse impact of low status of women on the overall economic development in
general and on reproductive health issues in particular, the National Population Policy of the country,
which was also endorsed in 1993, included in its objectives women‘s status and health issues such as
reduction of incidence of maternal mortality, improvement of females‘ participation at all levels of
education and enhancement of the contraceptive prevalence rate (TGE, 1993).
The 1994 Education and Training Policy affirmed the importance of girls‘ education. It focused on the
reorientation of the attitude and values of the society towards recognizing the roles and contributions of
women in development. The policy included gender equality issues such as increasing girls‘ school
enrolment ratio, preparing a gender sensitive curriculum, and reducing girls‘ dropout and repetition
rates (FDRE, 1994).
In an attempt to address customary practices and backward traditions that undermine the roles of
women in society, the National Cultural Policy was enacted in 1997. The main objectives of this policy
are to ensure equal participation in and benefit from cultural activities, and to abolish traditional
harmful practices that violate the rights of women such as early marriage, female genital mutilation and
abduction (FDRE, 1997).
In addition to the aforementioned national policies gender equality is guaranteed by the Constitution of
the country. Article 25 of the FDRE Constitution states that all persons are equal before the law and it
prohibits any discrimination on grounds of gender. In Article 35, equality in matters related to
employment, equality in acquisition and management of property, equal participation in policy and
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decision making, and right of women to plan families are stated to ensure gender equality. Similarly,
Article 42 states the right of female workers to equal pay for comparable work (FDRE, 1995).
On the basis of the Women's policy of the Country, a considerable number of women's machineries
have been set at different government level ranging from Federal to the lowest administrative unit.
From 1991-1995 the Women's Affairs Office (WAO) is constituted in Prime Minister‘s Office with a
mandate of coordinating, facilitating and monitoring of women's affairs activities at national level. In
1995 this was changed to a separate ministry; the Ministry of Women‘s Affairs. The following are
some of the duties and responsibilities/mandate of WAO:
 Coordinate, facilitate and monitor of women's affairs activities at national level;

 Create conducive atmosphere for the implementation of women's affairs policy in various
governmental organization and the country in general and monitor its realization,
 Encourage the establishment of women affairs organs in all the regions, central ministries and
public organizations at all levels, as well as the formation of self initiated women's
organizations in order to strengthen and expand the activities of the Ethiopian women.
 Coordinate the financial and material aids to be secured from various sources;
 Process information and reports to be received from women's affairs departments and self
initiated women's organization and provide solutions to their problems in consultation with
higher authorities;
 Organize seminars, workshops and symposiums at the national level
Other Women's Affairs Department (WADs) is also set up in 16 sectoral Ministries, two Commissions
and in all regional governments at department level. According to the policy, these WADs are
accountable to the organization in which they are formed and have equal power with other
departments. The WADs are, therefore, responsible to monitor, follow up and design ways of
implementing the national women's affairs policy effectively in accordance with the powers and duties
of the organization in which they are based. Based on the decentralized development program of the
country, gender focal points have also been established in each Woreda (district) in order to incorporate
gender issue in local development program.
Being placed in the highest governmental office, the 'Women's Affairs Office play a primary role of
facilitating, coordinating and monitoring activities of the Women's affairs departments and bureaus
established in the various line ministries and regions. Although the implementation of the national
policy on women lays mainly with the government machineries, NGOs, Women's Organization and
other stakeholders also play a pivotal role for the successful implementation of the national policy.
Concurrently, it is within this already established institutional mechanism for the advancement of
women that the BPA is being implemented in Ethiopia.
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Even if women in Ethiopia formally have the same rights as men, their situation is difficult and does
not show any sign of improvement. According to the UN‘s Equal Rights Index (GDI) on health,
education and work, Ethiopia is ranked as 142 out of 146 countries. Despite the existence of policy
instruments and legislative and institutional commitment to women‘s causes, the vast majority of
Ethiopian women, especially in rural areas live in poverty. Their status in the socio-political, economic
and cultural contexts is critical.
The main reasons for the situation are the socio-cultural portrait of women and girls and their assigned
role; existing practices of resource distribution; the division of labor, and the distribution of
opportunities. Moreover there is a considerable gap between the needs and concerns of women and
girls, and the actual effort being made in response to them (CEDAW). In most cases this is associated
with implementation, or lack of implementation, of the policy, laws and constitutionally given rights of
women, and to national poverty.
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COURSE 3: REGIONAL GROWTH AND LOCAL
DEVELOPMENT
Unit One
An Overview of Some Conceptual Foundations
This introductory unit investigates some of the conceptual foundations of the regional growth and
development. It deals with some definitional issues (like region, regionalization, and development);
and finally, the growing concern with regional growth and development.
1.1 The Concept of Regions and Regionalization
The concept of region is very elusive/vague and it is a difficult to define because it has complex
physical, political, and socio-spatial dimensions. Regions are generally, considered to be
geographical entities that are similar than a nation state and which possess common physical,
economic, or social characteristics which differentiate them from other areas.
Geographers defined region as ―an area in which many physical and human factors integrated to
form a part of geographical space which is recognizably different and distinctive from others‘‘
(Halland, 1976). According to Richardson (1973) a region is defined as a ‗‘ sub national areal
unit… the sub-division of national economy in to a limited number of fairly large and contagious
regions‘‘. According to David Simon (1990) a region is a sub-national division of space, delimited
in terms of some criteria that reflect physically and/or socio spatial diversity.
For the purpose of this course, a working definition of region could be the concept given by
Chisolem. Chisolem defined region as an area within a nation which enjoys certain powers of
government or at least administratively. It is assumed that such region would be delimited either on
the basis of homogeneity of specific characteristics or functional relationships between different
components of region‘s economy.
Ways of Delineating Regions/Regionalization

Regionalization refers to the techniques of delineating space into regions. Accordingly, regional
economists and other disciplines delineate regions using different techniques and identified
different types of regions. According to Simon (1990) there is no any single way of delineating
regions and therefore, regions can be delineated using several ways. However, most common
delineating region is the one defined by state so as to from sub-national or lower administrative
units.
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Natural Region: refers to a spatial unit defined by physical criteria: soil, relief, vegetation,
climate... whether they are large or small, these regions provide the framework for determinist
research on the man-environment relationship.
Cultural Region: The term "cultural region" designates the area over which cultures are spread and
develop territorial solidarity. Cultural geographies are very rich and provide the link between the
history of societies and spatial practices.
Richardson (1978) uses three criteria to delinate regions i.e. homogenity, nodality and
programming. According to the first criterion (homogenity) areas adhere togther to form regions if
they have some kind of common elements. These elements could be economic (similar per capita
income levels, a major dominating activity, a relatively a uniform employment or social and
political elements). A homogeneous region is demarcated on the basis of internal uniformity.
Another alternative ways of delineating region is based on nodality (functional integration). Here a
region is composed of areas that exhibit more interaction with one another than the external areas.
It is the intent of economic interdependence that serves as a criterion for regional demarcation.
Functional Region is defined according to the operational structures of its activities. It is due to its
explanatory potential that this concept became of central importance in regional studies. It gave
regional analyses a more nomothetic character that was to go on to develop regional science and in
doing so paved the way for generalizations that were fundamentals to economic planning. The most
important features of functional region is that different parts of region‘s economy are linked
through sets of flows of one form or another especially linked in trade.
The third way of delimiting region is according to the planning problems. Regionalization can also
be developed on the basis of regional pathology: the emergence of "problem areas" which can be
categorized in to four problem regions. These are backward regions; developed regions in
recession; regions with excessive growth and regions with growth concentration.
In addition, regions can be delineated on administrative or political basis. In considering planning

and administrative regions, sub regions, districts or other areas homogenity and functional
integration are both relevant.
Beyond these widely used human, historical, cultural and economic realities, regions can be formed
depending on its privileged geographic scale. At the end of the 20thc region has become more
economic and political; and it has even become supra-national: in the United Nations the world is
divided into areas such as "European region" and "American region", etc.
1.2 The Concept of Growth and Regional Development
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Development is the societal process of shifting restrictions on the realizations of human potential in
which the shifting of one constraint necessarily affects the incidence of other restrictions. A
satisfactory definitions of development would have to take in to account the differencing
opportunities existing for various groups, since restrictions are unevenly distributed over the
various groups.
The concept of development can be approached in at least three distinct ways: operational,
relational and comparative approaches. The operational meaning of development implies that some
groups sets objectives for themselves in terms of shifting constraints that may be physical (a lack of
water for agricultural production), economic (low product prices due to oligopolistic market
structures) or socio-political (a lack of participation in public decision making). For such groups
development mean agreeing on the objectives its members want to pursue, the means they intend to
use and the actions the group has the capacity to undertake. For such group the operational focus
may change as reactions by others are evaluated and/or as objectives are attained. Once one
constraint has been shifted, the group will attempt to further develop by shifting other constraints.
The concept of development is relational in that it implies changes in economic and socio-political
structures. Thus, the position of a group that has power will in general be affected if another group
acquires participation in decision making. Sharing power weakens the first group‘s relative position
in society. In other words, bringing the concepts of development to the group level makes it clear
that changes in the interrelations of groups are implied. In other words, development has eminently
political nature.
Finally, the concept of development is comparative in the sense that it can be used to identify inter-
group differentials in terms of attributes that are perceived as constraints. For instance, if certain
legal rule says that illiterates are not allowed to vote, the group of illiterate has an attribute the
constraint of no voting right.
Regional development deals with the processes of economic and social changes at sub national
level. It deals with the alleviation of development problems within a region based on the national
development objectives and priorities. The purpose and objectives of regional development are to
increase regional productivities as measured in employment, income, valued added, etc.; and to
bring social development as indicated in public health welfare, environmental equality, etc.
1.3 The Growing Concern With Regional Development Issues

As late as 1948, although governments have a large stake in the results of locational development,
great power to influence that development and a correspondingly heavy responsibility for
influencing it in a socially desirable direction; few governments have ever followed any coherent
policy in regard to location. However, a radical change in thinking about regional development was
already brewing. In Britain, it had become clear that the depressed economic position of the
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northern and Welsh industrial areas presented an intractable problem and controversy was
widespread on which national policies might or might not work.
Since the 1950s, with some frustration, it has been observed that developing countries do not seem
to catch up automatically with the more advanced ones, even with continued and massive
international assistance of various types. Moreover, economic statisticians and historians who had
been investigating interregional disparities of income, found reason to question the inevitability of
convergence. One basis of concern and of desire for better understanding of regional development
policies, it has been a realized that regional stagnation and depression can be quite persistent.
Throughout much of the 1960s, attention was drawn to pockets of poverty in what otherwise was
thought of as the "affluent/wealthy society". Today, we are less apt to view regions with low levels
of economic growth or even those experiencing absolute decline in economic activity as being
anomalous.
Reasons for the Change in the Concerns towards Regional Development
Some of the major factors which contributed for the change in the concerns of regional
development objectives and policies include the following factors.
Rapid urbanization: there is a distinctly urban dimension to many of the changes in the concerns
of regional development thinking. The process of urbanization has accelerated because of the
declining relative importance of agriculture. Unemployment in urban areas is more visible and
more unsettling for both the individual and the community than in rural. Furthermore, the rapid
shift of people from rural areas to urban slums intensified this change; and along with a complex set
of other problems of urban adjustment, it vastly increased the number of urban areas calling for
external economic aid. Moreover, problems of traffic congestion and environmental pollution,
particularly in and around urban areas, stimulated a search for more rational use of space and
resources. These problems developed during the 1950s and 1960s, when virtually every major
metropolitan area was growing.
Fiscal pressures on local and state governments: for expanding areas, with increased demands
for all kinds of public services, the principal revenue sources of those jurisdictions often do not
keep up with rapidly rising demands of the population. States and local communities are rightly
fearful that higher taxes will drive away or deter business investment. The same fear persists in
regions characterized by decline; the demand for services does not fall proportionately with
population. Often, the least mobile persons are most in need of public services. This as well as the
substantial resources required to maintain the existing infrastructure of roads, bridges and sewer
systems put upward pressure on tax rates that threatens to place areas hard hit by structural change
at further disadvantage.
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As a result of these forces, though sometimes reluctant, there has been increasing reliance on more
ample and flexible taxing powers of the national government to finance local programs such as
education, health and highways and still more broadly to provide unrestricted grants to provinces
for use at their discretion. This channeling of public money through the national treasury naturally
brings to the fore rival regional claims on nationally collected funds and the competition may be
intense as national policy makers are themselves forced to reconcile diverse pressures for increased
expenditures with slow growth in revenues. Thus, the problem of just and efficient allocation of
resources becomes one of the utmost concerns of regional development objectives and policies.
Another factor arousing interest in the policy problems of regional development is disillusionment
with the effects and objectives of the more naive forms of local and regional self-promotion. As
more localities participate in this competitive game, more of the total effort is recognized as simply
canceling out. That is, each community is driven to promotional efforts in self-defense by the
activity of rival areas. Thus, more and more questions are raised about whether growth itself is a
sensible standard of community interest and objective of public action at the local level.
A significant shift in the attitude of the general public and of most economists, towards population
growth on a local, regional, national, or world basis has also contributed for the change in the
concern of the objectives and policy of regional growth and development. In the 1920s and 1930s,
the beneficence of population growth was unquestioned and leading economists and statesmen
were pointing with alarm to the danger of economic stagnation that would be set us if we did not
get busy breeding more young consumers. However, this attitude has changed considerably. In
part, the change came from the frustration of seeing hard-won output gains in so many of the
underdeveloped countries canceled out by mushrooming population growth. The generally
inflationary bent of the economy and the relatively high fertility of people low on the economic and
education ladder all helped to undermine the venerable new world tradition of the blessings of
increased population. Today, regional development objectives and its policies are much more
aimed at welfare objectives such as fuller employment and higher per-capita income rather than to
the misleading standard of aggregate growth.
Another contributing factor in the shift towards more enlightened approaches to regional promotion
is the intensity of provincialism. We now find it normal for individuals to make their home in
several different communities and regions during their lifetime and for them to travel often and
widely. This more varied exposure is conducive to more objective feelings about programs that
may benefit one region at the expense of another.
Finally, there have occurred (and are occurring) a number of important changes in the factors
determining location choices of producers and consumers. These changes, arising mainly from
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changes in technology and increased income and leisure, really underlie many of the developments
already mentioned and have certainly played a significant part in the rethinking on regional
development. In general, Concern, controversy, and experiences have brought into focus some
basic issues of regional development objectives and policy.
Unit Two
Some Basic Questions on Regional Growth and Development
The fundamental questions in regional growth and development concerns causes of growth: why
do some regions grow faster than others? What are the primary initiating factors responsible, and
through what processes do these causes operate? What is the role of interregional trade, migration,
and investment in the spread of development from one region to another? Regional convergence:
Why is convergence so much in evidence? Is it universal and inevitable, or is it subject to
reversals?
2.1 Causes of Regional Growth and Development
Regional growth and change involves complex interactions among activities within the regional
economy, so it is not reasonable to expect that any single cause of such change can be identified.
Useful explanations consist mainly of analyses of the ways in which an impetus of change is passed
from one region or one regional activity to another. However, some theories of development
emphasize certain kinds of change as especially independent, exogenous, primary, or causal. In
particular, the external demand for a region‘s exports and its supply of labor and other production
factors have been stressed as prime movers in some widely accepted theories of regional
development.
The various kinds of linkages among firms and activities in a region brought to light some effects
of a cumulative or chain-reaction character. Both vertical and complementary linkages are
generally of this type. Thus, external economies of agglomeration (the expression of
complementary linkages) attract firms and activities of a similar nature, and this further enhances
the agglomeration economies, so that still more firms and activities are attracted, which leads to
still more agglomeration economies. Vertical linkages purse have cumulative effects. For instance,
if Anbessa shoe factory is able to increase its sales to other areas/regions, the factory will buy larger
quantities of inputs locally. Each of the supplying activities will then increase its own local
purchases of inputs and also results in salary increment for its workers (and therefore, the workers
will spend some of the increased salary on housing, consumer goods and services, and the factory‘s
public utilities will need more labor and other inputs).
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It appears, then, that vertical linkages of activities in a region and also complementary linkages
(which are really combinations of vertical linkages) have self-reinforcing effects. An initial change
in the level of activity in the region leads to still further change in the same direction and affects a
broader range of activities.
The other forms of clustering lie in the horizontal linkages among activities, which are
characteristically negative or locationally repulsive, in their effects. In other words, activities in a
region are always competing for some scarce local inputs (for instance land, labor and others); and,
particularly in the short run, increased demand and thus, raises the cost of these inputs.
2.2 Demand and Supply as Determinants of Regional Growth
The kinds of linkages discussed above represent ways in which some impetus to regional growth is
transmitted from one activity to another within the regional economy, thus, leading to overall
growth or decline. The next question is where can such impetus originate? What really initiates
regional growth? Here, the dichotomy of supply and demand appears. Regional activity requires
both inputs and a market for outputs and thus, it does not make sense to argue that either supply or
demand is the sole determinant of regional growth.
If we look at demand for the explanation of regional growth, we first inquire where the demand
comes from and then trace its impact through the regional economic system. This approach
emphasizes backward linkages among regional activities, since such linkages are the way in which
a demand for one regional output (for instance shoes, beer …etc) gives rise to demand for other
regional activities and inputs (say, inputs for shoes and beer, the generation of electricity, or the
employment of labor).
In contrast, If we look at supply for the explanation of regional growth, we inquire where inputs
come from and in what way the supply of, say, mineral resources, capital, or labor in a region leads
to regional activity generating a regional supply of (leathers, barley, labour, electricity… etc). The
approaches from the supply side emphasize forward linkages among regional activities. Clearly,
both approaches are relevant and necessary parts of an adequate theory of regional change and
development. Complementary linkages and external economies of agglomeration, involve both
backward and forward vertical linkages; and in evaluating the factor of competition for scarce local
inputs both demand and supply have to be considered.
2.3 Regional Input-Output Analysis: Analysis of Supply And Demand Driven Model
Actually, various types of models of regional economic interaction have been developed to trace
the impact of demand on a region‘s income and employment. They all involve some framework of
"regional accounts" describing transactions between the region and the outside world and among
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activities within the region; and nearly all include some type of multiplier ratio that sums up the
relation between an initial increase in demand and the ultimate effect on regional income or
employment. Some of these procedures are primarily relevant to short-term variations, while others
are more relevant to long-term regional growth trends. We shall confine attention here to models
using an input-output or inter-industry framework. The essence of the input-output schema is a set
of accounts representing transactions among the following major economic actors.
First, intermediate private business activities within the region. The sector is broken down into
individual industries or activities (such as mining, food processing, construction, and chemical
products). It is sometimes referred to as the inter-industry sector because much of the detail refers
to transactions among the separate industries within the sector. Second, households individuals and
families residing or employed in the region, considered both as buyers of consumer goods and
services and as sellers (primarily of their own labor). Third, government, local and national public
authorities, both within and outside the region. Fourth, the outside world activities (other than
government) and individuals located outside the region. Finally, the region‘s stock of private
capital, including both fixed capital and inventories.
What we have, then, is simply an analysis of the inputs and outputs of each of the designated
activities in the intermediate sector. Activities within the intermediate sector engage in inter-
industry transactions with one another (and also each with itself, since each activity includes a
variety of firms with somewhat different kinds of output). Sales by the intermediate sector to other
sectors are called sales to "final demand". At this point, the outputs are considered to be in their
final form, not destined for further processing, and ready for their final stage of use as far as the
region is concerned—namely, export, delivery to household consumers or the public sector, or
incorporation into the stock of capital. They are leaving the region‘s stream of current processing
activity. The input-side counterpart to final demand is "primary supply": Imports and the services
of labor, capital, and public authorities are entering the region‘s processing system for the first
time.
The intermediate sector is shown delivering outputs to the various final demand sectors and
receiving inputs from those same sectors in their capacity as primary suppliers. Money payments
for these goods and services flow in the reverse direction, from final demand sectors to the
intermediate sector and then to primary supply. In tracing changes, we can follow the flow of
money payments "backward" from purchaser to seller, or we can follow the flow of goods and
services "forward" from producer to user. The scheme is symmetrical with respect to supply and
demand, or input and output. It does not indicate whether we should look for the initiating causes of
regional growth and change in final demand, in primary supply, or within the intermediate sector;
and we might reasonably infer that change can originate in any of these three areas.
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In view of this basic symmetry, it is striking that the techniques of input-output and multiplier
analysis have nearly always been applied in just the backward direction, tracing the effects of
changes from final demand to the intermediate and primary supply sectors. The implication in
locational terms is that market orientation and backward linkage are all-important, with no attention
being paid to input orientation or to forward and complementary linkage effects. This is because an
input-output table is a reasonably comprehensive and neutral image of a regional economy; we can
use it as a point of departure for the consideration of supply factors as well as demand factors.
The demand-driven model discussed above emphasizes final demand, backward linkage, and
output orientation of activities. Now let us reverse the emphasis to focus on the roles of primary
supply, forward linkage, and input orientation. When considering the effects of demand on regional
activity, we implicitly assume that supplies of inputs, such as labor, capital, imports, and public
services, were taken to be perfectly elastic and consequently imposing no constraint on regional
growth.
Conversely, the supply-driven model of regional growth takes demand for granted. That is, it
assumes that there is a perfectly elastic demand for the region‘s products and thus, regional activity
depend on the availability of resources to put into production. Accordingly, the starting point in the
process of change now becomes primary supply rather than final demand. Availability of labor,
capital, imported inputs, and government services and infrastructure makes possible, through
forward linkage, certain intermediate activities oriented to such primary inputs. Increase in output
by an activity that sells in the region can encourage, through further forward linkages, increases by
other activities, giving rise to what may be called a "supply multiplier" effect. This effect is limited
by the existence of supply leakages/outflow. At each stage, some of the increase in regional outputs
is drained off into exports, investment, deliveries to governments, and household consumption—in
other words, to the final demand sectors.
This supply-driven process sounds very much like the converse of the demand-driven process
discussed earlier, whereby an initial increase in final demand gives rise to indirect growth of
income and employment in the region and increased drafts upon primary supply. In sum up, the
demand-driven and supply-driven models should be viewed as complementary rather than as
conflicting or rival hypotheses about regional economic change/growth. Each of the two model
types in itself is one-sided and can be seriously misleading. Therefore, for full insight into real
region‘s growth process both demand-driven and supply-driven models need to be combined.
2.4 Inter-regional Trade and Factor Movements

A broader multi-regional view of the development process focuses on the roles of inter-regional
trade and factor movements. A region‘s growth involves at least three kinds of external
relationships of the region: trade, or the import and export of goods and services; migration of
people, both in their capacity as consumers and in their capacity as workers; and inter-regional
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"migration" of other production factors, notably investment capital. Finally, external influence is
the national government‘s revenue collection and expenditure in the region.
As David Ricardo noted a long time ago, with respect to nations, trade among regions has the
beneficent effect of allowing each region to specialize in those activities for which it is best fitted
by its endowments of resources and other fixed local input factors, with all regions sharing to some
extent in the economies of such specialization. Recognition of this effect helps to place the value
and limitations of the export base theory in better perspective. When the local market is so small as
to limit seriously the productivity gains that can be realized by specialization, exports may be
necessary for regional growth. Thus, the weakness of the export base theory lies not in recognizing
exports as being important for growth, but rather in focusing on exports exclusively and failing to
recognize that it is trade (imports as well as exports) that permits the realization of economies due
to specialization.
The effect of free inter-regional trade is likely to be in the direction of equalizing not only
commodity prices among regions but also wages, incomes, and the rates of return to capital. The
reason for this is that a region in which capital is scarce relative to labor can, with inter-regional
trade, specialize in "labor-intensive" lines of production requiring much labor and little capital
while importing the products of "capital-intensive" activities from regions better endowed with
capital or less endowed with manpower. This substitution of trade for production-factor mobility is
of course only partially effective. Considerable differentials persist in the rewards of labor and the
returns on capital among the regions, leaving an incentive to further equalization by migration of
those factors of production.
2.5 Mobility of Labor and Capital among Regions
The rate of return to labor (real wages) is indeed a major determinant; but migration and regional
manpower supplies depend on the handicaps to movement imposed by uncertainty, ignorance, and
cost of moving and social distance. Moreover, a person‘s mobility varies widely according to his
age, marital and dependency status, education, skills, and recent migration experience; and
migration flows between places depend on such additional factors like the size and diversity of
labor markets, and the effectiveness of interregional job-information and placement systems.
The mobility of capital is affected by quite similar ranges of considerations. The prospective rate of
return is a major determinant; inertia, ignorance of opportunities, and social distance act as limiting
factors in much the same way as they do for manpower mobility. The effectiveness of organization
of the national financial system (including clearing arrangements, facilities for transferring funds
from one region to another, securities exchanges, and interregional markets for still other types of
investments and obligations) tends to set a limit on how much interest rates and other rates of return
on capital can vary geographically within a county. Increased effectiveness of the national financial
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system in most countries has been evidenced by a trend of inter-regional convergence in money
rates, though such rates still tend to be somewhat higher in places more remote from the chief
national financial centers and in smaller urban places.
Something analogous to the beaten-path effect on labor mobility appears to affect capital mobility
as well. Funds flow more readily and in response to a smaller rate-of-return differential from one
point to another if there has been a great deal of previous investment following the same path. Still
another similarity appears in the effect of regional or community characteristics on the outward
mobility of both labor and capital. A young area with a previous experience of inward migration
and rapid growth shows more outward mobility of both factors than does a more settled and
ingrown community.
Perhaps the most important difference between the processes of capital and labor migration lies in
the fact that most capital has to be "sunk" or invested in durable forms such as site improvements,
buildings, and production equipment before becoming useful. This major portion of the capital
stock has virtually no spatial mobility. Movements of capital are thus, confined to newly created
capital awaiting selection of a fixed-investment opportunity, and working capital and other floating
funds that remain in the form of paper assets or fairly easily movable types of commodities and
thus retain inter-regional mobility.
More generally, however, people do lose mobility rather suddenly once they become established in
an occupation, a community, and a family; and mobility thereafter declines further with increased
age. In part this is due to the fact that information and skills relevant to a particular line of work,
company, or community may be very specific, in the sense that they are not of comparable value
elsewhere.
Scale and agglomeration economies affect the migration of both labor and capital, and in not too
dissimilar fashion. A location that might be highly advantageous if enough manpower and/or
enough capital could be concentrated there may never get over the threshold imposed by the higher
costs of an initial small-scale operation or an insufficiently developed production cluster.
Finally, it can be observed that the migration of people from one place to another facilitates the
movement of capital along the same route. To some extent this reflects the fact that migrants
normally bring some personal capital with them and often some business capital as well. A further
explanation is that the increased familiarity with the other area, which comes from the movement of
either labor or capital, enhances the mobility of the other factor along the same path, eroding the
barriers of uncertainty and social distance.
More basically, the relation between labor and capital flows is affected by the way in which these
factors combine to produce goods and services. Labor and capital can substitute for one another in
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production if it is possible to choose between a labor-intensive and a capital-intensive technique,
depending on which factor is relatively cheap. The substitution relationship in itself would imply
that a larger supply of capital in a region would lessen the demand for labor, since there could be a
shift to more labor-saving production methods and more capital-intensive activities. Similarly a
larger labor supply could lessen the region‘s capital requirements. But this picture is clearly
unrealistic in many cases, because the factors of production are at the same time complementary.
Using more of one may lead to using more of the other as well. The complementary relationship in
itself would imply that a larger supply of capital in a region would augment the demand for labor,
since production would expand in response to the enhanced competitive position of the region‘s
activities. Similarly, a greater supply of labor in a region would create a demand for additional
investment in production capacity to take advantage of this more ample and perhaps cheaper labor.
The effects of trade and of factor movements on regional structural differences can often be
opposite. Trade in itself permits more intensive regional specialization and thus a widening of
regional structural differences. Interregional movements of labor and capital, on the other hand,
would seem in general to weaken one of the main bases for specialization (that is, relative regional
supplies of labor and capital) and thus promote convergence of regional structural differences.
This last surmise is subject to qualification, however, since it ignores the effect of regional
differences in endowment of really immobile factors (land or natural resources). To the extent that
such resources are complementary to labor and capital in production processes, regional
specialization and structural differentiation based on fixed-resource endowments will be enhanced
by greater inter-regional mobility of labor, capital, or both. This is likely to be true of mineral
resources when they occur in regions with few other natural advantages—movement of capital and
labor into such regions helps them to develop exploitation of their mineral resources as a regional
specialty.
2.6 Inter-regional Growth Convergence
Plausible explanations for the convergence of regional income differentials, would seem to be a
natural result of the gradual development and maturation of areas once on the frontiers of
settlement, the greatly reduced relative importance of farming as a means of livelihood, the
improvement of transport and communications and the enhanced mobility of both capital and labor,
and the rise of more activities not closely oriented to natural resources and consequently enjoying a
wider choice of possible locations. Moreover, increased inter-regional trade resulting from
improved transport can also promote convergence by permitting regions to share the benefits of the
production economies of other regions to a greater extent.
Another explanation for inter-regional convergence is the inter-regional capital flows. Actually,
shifts of employing activities are equalizing factors only to the extent that the activities are
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primarily oriented to labor supply, so that capital is drawn to low-wage regions. Consequently,
changes in production and transfer of technology, availability and use of resources, economies of
agglomeration, and other location factors can either narrow or widen income differentials according
to circumstances. For example, if agglomeration economies assert a powerful influence on capital
movements, regions realizing these economies would grow most rapidly, thus creating more
agglomeration economies and promoting continued growth. In this model, inter-regional
movements of factors of production are determined by regional earnings differentials and
differentials in the rate of growth of output, which they use as a proxy for employment
opportunities.
Changes in the make-up of demand for goods and services may also affect income differentials. For
example, the practically universal tendency of demand for agricultural products to grow more
slowly than demand for manufactured products and services in a progressive economy seems more
likely than not to widen the differential between incomes in farming areas and those in
industrialized and urban areas.
It is by no means certain that convergence of regional income levels is an inevitable outcome of the
process of development. For, while migration and trade do appear to exert significant pressure
towards convergence, they operate within such a rapidly changing environment that dynamic
factors may possibly offset their influence. One may argue that migration and trade may become
progressively more important during growth, as a result of improvements in transportation, and
hence that the pressures towards convergence will tend increasingly to predominate.
Interregional Convergence Vs Stages of the Development Process

The consideration of all the factors influencing regional income inequalities leads to an interesting
hypothesis relating convergence and divergence systematically to the stages of the development
process. Specifically, the early stages of national/regional economic development are associated
with increasing regional income disparities, while regional income levels tend to converge in a
more maturely developed national/regional economy.
When industrialization is in its early stages, most of the rise in overall productivity and per capita
income comes from the increasing importance of the non-agricultural sector relative to the
agricultural. The new activities cannot take root everywhere at once but are highly concentrated at
first in a few key cities, particularly the places with the most active contact with more advanced
countries and the largest and most diverse populations. At this stage of development, most regions
still lack the necessary local market potential and the necessary local inputs to engage in the new
and unfamiliar types of activity. Migration is likely to be heavy from the backward areas/regions to
the industrializing cities. The result is the next stage: progressive agglomeration of modern industry
in the principal urban areas and an accentuation of regional differences in economic structure,
productivity, and income.
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As development proceeds, more and more regions acquire the market potential, attitudes, and
access to capital and know-how required to surmount the threshold of industrialization. A stage of
inter-regional convergence in economic structure, productivity, and income sets in. This
convergence may be made cumulative because migration is likely to become less selective, and
national government policies will be less preoccupied with the objective of getting industrialization
started in the country as a whole and more sensitive to the political pressures arising from regional
inequality.
2.7 The Role of Cities in Regional Development
The existence of sizable urban centers seems to be a necessary (though not always sufficient)
condition for the transition from a basically agrarian economy to an advanced economy with high
productivity and a wide range of productive activities. First of all, there is the relatively
cosmopolitan aspect of large cities. They are a ‗region‟s eyes and ears‟ perceiving the outside
world. "Foreign" ideas, goods, and procedures have much to contribute to the development of even
the most advanced region; and cities.
Quite apart from their inter-regional contact function, cities serve an important role in the
development process simply by being places in which people/entrepreneurs from other parts of the
same region or country are brought together in densities and living conditions sharply contrasting
with those of the rural areas. Conservative traditions and outlooks that persist in the hinterland tend
to dissolve rather quickly in the urban melting pot; the results are always conducive to more rapid
social and economic change, though they are often painful and destructive in terms of personal
satisfaction and orderly social and political adjustment.
Social effects of urbanization that can be of major importance in overpopulated countries are the
mutually reinforcing tendencies toward smaller families and toward greater labor force
participation of women. For the working population as a whole, urbanization represents exposure to
a way of life in which work is more scheduled and organized, monetized transactions and
impersonal relationships play a larger part, literacy and adaptability to change are more valuable
personal assets, and the choice of occupations and lines of individual development is widened. In
economic terms, this involves the genesis of new techniques, new products, and new firms.
Such places provide the exposure to a wide range of ideas and problems from which solutions
emerge. They represent large concentrations of customers and suppliers most receptive to new
products and requirements. They provide the diversified supply of skills and supporting services
that enable a producer to start small and concentrate on a narrowly specialized function. They
provide a social and business climate in which impediments of tradition and personal inertia are
minimized and initiative and innovation carry prestige; and in which the innovator can learn much
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from day-to-day contacts with competitors and can most easily tap the stock of accumulated know-
how, exploiting inventions arising in cities.
Major cities are the locations at which the newest types of activities can most easily get a foothold
within any region or country and the advent of industrialization in an undeveloped country is
generally accompanied by explosive growth of the largest centers and a heightening of economic
and social contrasts between those centers and the rural backwaters. But as development proceeds,
two things happen. Some of the sensitive infant industries of yesterday attain maturity: their
techniques become less experimental and their products more familiar to a wider market. As a
result, these activities are no longer so dependent on the special advantages that large cities
provide. At the same time, the positive incentives to decentralize out of the initial large city
concentration tend to increase. With a larger and wider market for the product, a location pattern
involving a number of regional production centers offers economies reduction in distribution costs
without undue sacrifice of the economies of scale.
The external economies of cluster become less important with the increase in financial and
technical resources of firms and the greater standardization of process and product. Costs of labor
and other local inputs in the initial large-city location now appear unnecessarily high in relation to
what these inputs cost in smaller places. And in the original centers where the industry developed,
maturity may well have meant some development of rigidities and loss of initiative because of the
aging of both business leaders and the labor force and the growth of defensive practices to protect
seniority rights, painfully acquired but obsolescent skills, positions of power, and other
accumulated perquisites. Thus, the city that hatched the industry and saw it through its infancy may
lose it altogether when it grows up.
Historically, large cities have been characterized by a disproportionate component of new and small
"growth industries" in their mix of activities, but they generally fail to maintain their share of
activities that have passed the early stages. Smaller cities and towns, and less-advanced regions,
have been more likely to show competitive gains in the sense of increasing their share of the
national total of employment in the activities represented there; but growth in these areas has
historically been held down by the fact that their mix of activities is often weighted with slow-
growth and low-wage activities. However, there are some signs of change in this historical pattern.
It is important to bear in mind that there had been substantial growth in smaller cities and towns
relative to the growth in metropolitan areas. Growth is transmitted down the urban hierarchy, has
itself evolved. The relative rates of growth of major cities versus smaller places depends to an
important extent on how rapidly the filter-down or dispersion of maturing urban activities proceeds
compared to the initiation of new urban activities. Faster development of the smaller, less
developed urban area "would seem to require that it receive each successive industry a little earlier
in its life cycle, to acquire the industry at a point in time when it still has both substantial job-
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forming potential and high-skill work." Additionally, it now seems that the filter-down process is
less important overall, as innovation and high concentrations of fast-growing activities are less
exclusively characteristic of growth in the nation‘s largest metropolitan areas.
2.8 External and Internal Factors in Regional Development
Since all regions contain a variety of activities, it is to be expected that some of these activities will
be determined mainly by external conditions based on demand (such as export markets), while
others will be particularly sensitive to supply conditions. Therefore, the regional economy as a
whole is always subject to a variety of growth determinants. Although there may be one principal
factor affecting its overall level of activity there is never just a single determinant factor.
Development of a region, in terms of its size, income level, and structure, is affected by external
conditions of two types: (1) demand for the region‘s outputs, or more broadly, external sources of
income for the region, and (2) supply of inputs to the region‘s productive activity. The impact of
these external factors is conditioned by the size and maturity of the region and by the internal
relationships of its various activities in the form of vertical, horizontal and complementary
linkages.
As far as growth determinants in the form of final demand are concerned, the latitude for regional
initiative is ordinarily limited. But perhaps export demand in some lines can be stimulated by sales
promotion campaigns, or the region can better its access to external markets by lobbying or other
pressure to get more favorable freight rates or transport services for its exports, improved
waterways, or high-speed highways. Improvement of the region‘s own terminal and port facilities
may also have some effect on export demand and thus, on regional growth.
A region has some leverage also on primary supply inputs. By persuasion, pressure, and subsidy, it
may secure better and cheaper inbound transport for its imported materials and may be able to
attract activities with strong forward linkages that will have a supply multiplier effect.
Governmental and private research centers and universities are increasingly valued as local
suppliers of services, people, and ideas providing the basis for new growth industries. Regions
where demand for labor tends to exceed supply can stimulate immigration by campaigns of
advertising and recruitment, publicizing both job opportunities and whatever amenities the region
has to offer.
Finally, regional growth can be significantly affected through changes in intra-regional input
supplies and inter-activity relationships, which are more immediately subject to local choice and
action. The quality of the labor supply can be enhanced by a variety of education and training
programs and by removal of barriers to occupational mobility and technical change (including
racial and sexual discrimination, restrictive work rules, and job entry requirements). The region‘s
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limited land and other natural resources can be managed so as to increase their contribution to
productivity. Local public services, an important input to almost all activities, can be made more
efficient and conducive to productivity and amenity. The region‘s economies of agglomeration can
be enhanced by appropriate action involving both public and private sectors (for example, in the
planned development of new and improved office centers, regional shopping centers, product
markets, health centers, research centers, and the like).
2.9 Regional Structure and Economic Health/Strength
Both a region‘s growth and the quality of opportunity it offers depend on external influences and
location and also to a large extent on the mix of activities that the region has. Other things being
equal, a region will grow faster if it specializes in "growth industries," just as it will tend to have a
low wage level if it specializes in low-wage activities or a high skill level if it specializes in high-
skill activities. Regional economic balance or diversification has been viewed as a "healthy"
structural feature worth striving for a long time. Thus, it is sometimes assumed that a region with a
diversified structure (many different kinds of activities and an absence of strong specialization) is
necessarily less vulnerable to cyclical swings of general business conditions and demand.
What really makes a region especially vulnerable to cyclical swing (move forward and backward)
is specialization in cyclically sensitive activities (mainly, durable goods industries and especially
those making producers‘ equipments and construction materials and components). However, when
we consider stability and other desirable attributes over a longer period, it is a different story. In
time, any of a region‘s activities will suffer arrested growth and perhaps decline or even extinction,
either because the product itself becomes obsolete or because the region loses out competitively. If
a region is narrowly specialized, such a loss can be, at least temporarily, disastrous; in a diversified
region, it is unlikely that a major proportion of the total activity will suffer at any one time. Equally
significant is the fact that a narrowly specialized region is likely to show less resilience/flexibility in
recovering its stride by developing new activities to take the place of those lost.
This attribute of resilience is an extremely important aspect of regional economic health/strength. It

depends to a large extent on diversification, since diversity of employment develops a wide variety
of skills and interests in the labor force and also among business entrepreneurs, bankers, and
investors, and a wider array of supporting local business services and institutions. In such a setting,
there is clearly a better chance for new kinds of business to get a start and to survive the hazardous
years of infancy. It has to be noted that diversity is not the only factor affecting resilience. The
inhibiting effects of high specialization are compounded if the region is specialized in activities
characterized by large producing units, large firms, and absentee ownership. Such large units are
relatively self-sufficient with respect to most kinds of business services that smaller units tend to
buy from others; consequently, a region heavily specialized in, say, steel making fails to develop a
broad base of such supporting services. In addition, its business leaders and sources of local finance
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have a more restricted outlook and interest. The range of local external economies is
underdeveloped, and the whole climate for new and small businesses and new lines of activity is
much less favorable than it is likely to be in a region of similar size where the firms and production
units are smaller, more numerous, and less self-contained.
Finally, a region‘s resilience partly depends on the amount of overall growth momentum. It may
experience the loss at a time. If the rest of the region‘s activities are growing vigorously, even a
sizable loss may produce only a short spell of abnormal unemployment. Fluctuations from a
sharply rising trend may not involve much absolute decline; distress is most meaningfully
measured in terms of how long and how far the region‘s employment is below the previous peak,
rather than how long and how far it is below a trend line. Moreover, a region that has been growing
rapidly has a number of characteristics favoring resilience. The labor force is relatively young
because much of it has been recruited through recent migration and young adults move the most
readily. Thus, the labor force is likely to be more occupationally mobile and adaptable, and less
afflicted by seniority and tradition. The same applies to employers. Facilities are newer. A greater
proportion of the population has had the broadening experience of living in other places. There is a
more buoyant community climate of expectation of growth and favorable change.
Unit Three
Theories of Regional Growth and Development
Development theories seek to explain and predict how economies develop or not develop over
time; investigate barriers to economic growth and forwards the ways to overcome these; suggest
how governments can initiate, accelerate and sustain economic growth and development. This unit
is structured in to three sections. The first section addresses the paradigms (top-bottom versus
bottom-up approaches) to regional growth and development where as the second section examines
the various conventional theories of regional growth and development. The final section broadens
the discussion by drawing attention to the contemporary theoretical perspectives on regional growth
and development.
Section One: An Overview of Regional Development Paradigms

Development paradigms provide the basic foundation to describe the theories and practice of
development at different levels. Theories and paradigms are similar in their abstraction and they are
generalizations, but their implications vary across countries.
As paradigms are broader than and encompass many theories, the different theories of development
can be seen under two dominant paradigms: development from above or top down approach and
development from below or bottom up approach to development. These paradigms, claiming their
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respective arguments, hold key prepositions to understand development and underdevelopment and
present their arguments in the context of regional growth and development.
3.1.1 Development from Above (Top-down Development Paradigm)
Top-down Development Paradigm views development as essentially emanating from the core and
growth centre and trickling down to the periphery and hinterlands. Accordingly, policies and
strategies of development are made at the centre by top officials. This paradigm aims to achieve
functional integration wherein leading (developed) regions expand in to lagging (backward) regions
and resources of the latter made accessible to the leading regions.
The essential argument of this paradigm is that development will spread over time from few
dynamic sectors and geographical clusters to the rest of the spatial system. This school is rooted to
the balanced and unbalanced growth controversies of the 1950s. The unbalanced growth model was
given high importance during the 1950s and 1960s.
The top bottom paradigm assume that development in its social, economic, cultural and political
dimensions can be generated only by few selected agents such as entrepreneurial pioneers, the
white, the urbanites and the intellectuals. The rest of the population are considered‘ incapable of
initiatives in making improvements, consequently everything must be done for them from outside,
at least temporarily. These few agents are able and willing to allow others to participate in the
development process within reasonable time span and on equal basis. These other groups are able
and willing to adapt the same type of development pattern
Critics argue that all the assumptions and hypotheses of this paradigm generally imply an
eventually monolithic and uniform concept of development and value system, which in practices
vary across the world. It ignores the great diversity of value systems and aspirations, and the great
variations in natural conditions. It serves the interest of large scale organizations and the leading
regions and very often overruling the interests of local and lagging regions and rural communities.
Critics also argue that within the context of developing countries, the top-down development
paradigm has contributed to external dependence on developed countries and multi-national
corporations and internally dependence of rural communities on the urban centre. And this
perpetuates persistent dominance of one or few large primate cities, which have critical problems of
unemployment and other social and economic problems; increasing regional development
inequalities and real per-capita income inequalities; different social strata; persistent and growing
food shortages; and deteriorating material conditions in the countryside.
Normally, large scale organizational linkages between areas of differing levels of development has
resulted in unequal distributions of power, unequal terms of trade, unequal distributions of scale
economies, increasing spatial divergence rather than a convergence of living standards or
development disparities. Even with explicit sub national development polices operating through
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large scale organizations, the sum of back wash effects in most cases still exceed spread effects.
The balance of the ‗‘backwash effects‖ and the ‗‘spread effects‖ can be regulated if there is a strong
control mechanism for avoiding leakages to exterior (control on commodity and factor flow from
the lagging regions) and a strong internal redistributive mechanism with broad public participation.
3.1.2 Development from Below (Bottom-Up Paradigm)
Development ―From Bellow‖ is an alternative development paradigm to the top-down development

paradigm. It gives high priority for economically less developed social groups and areas/regions to
their own self determined societal standards. It argues for the need for change in the level of
development decision making: to the local level. The development ‗From Below‘ does not
necessarily dispute the path of development ‗From Above‘; instead it argues for the regions to take
control of their own institutions and create a desired life style. According to Richardson (1973), the
objectives of development ‗From Below‘ is to adapt development patterns to fit regional character
and assure generative growth.
Development from below involves controlling the ‗back wash effects‘ of development from above
and the creation of dynamic development impulses/engine within less developed regions. These
require the creation of endogenous factors of change for increased equity and development
dynamics and the changes in the interactions between the different regions. Therefore, development
from below aims for the full development of region‘s/nations natural and human resources/skills
for generative growth. Most basic needs services are territorially organized and manifest
themselves at the level of small groups and local communities.
Development from below implies alternative criteria for factor allocations (shifting from
maximizing return for selective factors to one of maximizing essential resources mobilization);
commodity exchange; advocates specific form of social and economic organization; emphasising
territorial rather than mainly functional organization; a change in a basic concept of development-
shifting from the monolithic concept defined by economic criteria, competitive behaviour, external
motivation to diversified concepts defined by broader societal goals, by collaborative behaviour
and by endogenous motivation.
It claims that development need to be considered as an integral process of widening opportunities

for individuals, social groups and territorially organized communities; mobilizing the full ranges of
their capabilities; and common benefits in social, economic and political terms. Different cultural
areas need to construct their own development strategies which require compatibility only at certain
points of mutual benefit. Alternative strategies of development from below need to emerge and be
adapted to the requirements of different cultural areas and such strategies may change over time. It
suggests that large parts of any surplus product within an area should be reinvested locally for the
diversification of the national or regional economy and provision of goods and services acceptable
for internal accessibility. Through the retention of at least part of the regional surplus, integrated
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economic circuit would be promoted within less developed regions and development impulses
would be expected to successfully pass up wards from the local /regional to national level.
The bottom up development paradigm argue that policies of development need to be oriented
towards reinvesting regionally created savings within a region; territorially organized basic needs
services; rural and village development; small scale and labour intensive industries and medium
sized projects; technology permitting the use of full employment of regional or local human and
institutional resources on territorially integrated basis.
Although they provide essentially different arguments, the above discussed two paradigms have
some common grounds. First, both paradigms recognize that nations/regions will progress through
‗stages of growth‘ and there are also common consciences about how regions evolve from lower to
higher stages of development (see Rostow's stages of economic growth). Second, both paradigms
have a common ground in the applications of economic base theory. Third, there is some agreement
between the two paradigms concerning the appropriate means for alleviating poverty. Theses may
include more attentions to human development; greater efforts to curb population growth; wider
and more rapid diffusions of agricultural innovations; and planning in terms of functional economic
areas and linking functional economic areas by transportations and communications policies that
encourage the spatial diffusions of innovations and facilitate the movement of agricultural and light
industry outputs from rural areas to large urban markets.
Section 2: Conventional Theories of Regional Growth and Development
The economic analysis of regional growth and development has a long history and dates back to
classical economists such as Adam Smith and Alfred Marshall. From an analytical perspective, the
foundations of modern economic growth theory can be found in the early work of Solow (1956), in
which he argues that, in a neoclassical economic world, the growth rate of a region (measured in
per capita income) is inversely related to its initial per capita income, a thesis which offers an
optimistic perspective for poor regions. Gradually, interesting regional growth models have been
extensively developed in the 1960s and afterwards which are reviewed in this section. This section
addresses the conventional theories of regional growth and development. Some of the theories of
regional growth and development include theories based on resources and supply; theories based on
demand and markets; and theories based on concurring space.
3.2.1 Theories Based on Resources and Supply

The exploitation of natural resources has played significant role in the expansion of many regional
economies around the world. However, existing evidences reflect considerable controversy
regarding the role that natural resources play in the development process. Some studies have
concluded that natural resources are important catalysts that can expedite growth while other
studies have suggested that resources can impede development by creating an unhealthy economic
dependence.
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Staple Theory of Regional Development/Export Base Theory
The staple theory was developed as a framework for analyzing the role of natural resources in the
development process by Harold Innis (1956) and W.A. Mackintosh (1964). This theory integrates
the physical geography of natural features with a theory of economic linkages to explain the spatial
pattern and institutional structure of the development process in regions. Staple products are
defined as being based on natural resource extraction and requiring little in the way of processing
prior to export to industrial countries where they are used in the production of manufactured
products.
It is important to note that the path of staple development is obviously more complex than this
simplified summary provides. Many factors, including the production function and technology of
the staple, which determine the nature of potential linkages; the quality and quantity of the resource
endowment; and the institutional environment in which the staple is developed all affect the impact
of staples on the regional economy. The interplay of these factors has given rise to two identifiable
schools of staple theory: the comparative-advantage school, which argues that staples have the
potential for creating sustained development; and the dependency school, which argues that staple
development distorts the economy in a way that blocks sustained growth.
The Comparative-Advantage School

The comparative-advantage school is more closely associated with the Mackintosh staple tradition.
Mackintosh (1964) began with the observation that ―rapid progress‖ in new countries/regions is
dependent on the discovery and development of cheap supplies of raw materials by the export of
which to the markets of the world, a country/region may purchase the products which it cannot
produce economically at that stage of development.
The comparative advantage school claims that regional growth is stimulated by the direct
investment in the extraction of the staple and by the “spread effects” of staple development. The
spread effects from staple products can be divided into four categories. These are:
1) Forward linkages: involving processing of the staple prior to export.

2) Backward linkages: involving the production of inputs such as resource machinery and
transportation infrastructure that are required to extract the staple.
3) Final-demand linkages: involving the production of consumer goods and services to meet
the regional needs of those who are employed in the staple industry.
4) Fiscal linkages: involving the expenditure of rents and profits generated by resource
production.
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Regions with an abundant supply of easily accessible natural resources have a considerable
advantage in the regional development process. Demand, capital and entrepreneurship are supplied
by external markets for the staple product, rather than being restricted by regional consumption and
savings rates. Manufacturing linkages are developed by the economic logic of processing resources
prior to export to reduce weight and freight costs. Higher incomes are generated by the in situ value
or economic rent generated by the resource. Rent is defined as the surplus income earned from
natural resource development after compensating for all other costs of production/extraction.
The ability to generate rent is an important determinant of the contribution of natural resources to
the regional development process. The regional economy expands through these spread effects to
achieve the economies of scale necessary to diversify through import substitution and other non-
staple-related growth. Over time, the regional economy can become decreasingly dependent on a
narrow staple export base and growth can become self-sustaining.
Natural-resource rent can be generated in several ways (Gunton and Richards 1987). First, rent can
result from the difference in cost between the marginal producer, who just covers costs, including a
normal return to capital, and the intra-marginal producer, who covers costs plus a return equivalent
to the cost advantage over the marginal producer—generally referred to as “differential rent”.
Second, rent can be generated if staple producers have sufficient market power to raise prices by
restricting the supply. This is normally referred to as “monopoly rent”. Third, rent can result from
the short-run mismatch between supply and demand because of the long lead times required to
change production capacity. This is typically referred to as ―windfall rent”. Finally, rent can be
generated by the absolute shortage of a resource, which results in higher prices in anticipation of
the exhaustion of resource is called “user cost rent”.
It is important to note that, regardless of the type, rent provides a surplus relative to other economic
activities that can stimulate growth by increasing income and consumption in the regional
economy. As Chambers and Gordon (1966) demonstrated, rent is the key measure of the
comparative advantage of staples relative to other economic sectors. In cost-benefit terms, rent is a
measure of the net benefit of resource development.
Proponents of the comparative advantage school emphasized the importance of foreign capital,
entrepreneurship, and technology in expediting the regional development process. As Mackintosh
(1964) concluded, ―without such borrowings and adoptions, progress is inevitably reduced to the
slow pace of domestic accumulation of savings and the development of local inventions‖.
Though Mackintosh (1964) lauded the comparative advantage provided by staples, he was acutely
aware of the challenges, particularly the combination of high fixed debt charges incurred to finance
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the extraction of staples and volatile revenues from the export of staples. As he observed, ―since the
incomes derived from the export of raw materials are notoriously variable, the economic difficulties
which new countries so frequently find themselves are those that occur when fluctuating incomes
are coupled with the rigid expenditures occasioned by heavy debt charges‖. He also cautioned that
staple regions have a propensity to form excessively bullish expectations during commodity booms
that stimulate investment in uneconomic capacity. Mackintosh‘s inventory of constraints excluded
many of the impediments identified in the dependency critiques. Nonetheless, Mackintosh‘s
optimism was a qualified one, which included an appreciation of both the advantages and some of
the challenges facing a staple economy. Hirschman (1981) developed a synthetic analysis that
staples can provide the basis for sustained growth if the income from staples is retained by the
regional economy and invested wisely.
The Dependency School

The dependency school argued that the extraction of staples incur high fixed costs because they are
capital intensive. As a result of the high capital costs, staple development is often undertaken by
large foreign-owned firms that have a bias for locating backward and forward linkages outside the
staple region because the linkages are often already established in the home location of the foreign
owned firm. The locational bias of foreign owned firms results in the creation of a truncated
economy that lacks processing linkages, backward supply-industry linkages, and higher-order
management and research and development functions. Incomes earned from the staple are also
leaked from the staple economy in the form of payments of profits and dividends to foreign owners.
Therefore, final demand and fiscal linkages are also underdeveloped. The foreign domination of
staple extraction also distorts the region‘s class structure by impeding the emergence of a strong
and independent entrepreneurial class in the staple region. The entrepreneurial class that emerges
instead is a staple-oriented class that supplies services to the foreign-owned industries but is largely
incapable of pursuing new, independent enterprises that are capable of diversifying the economy.
The problems of the staple region are compounded by the nature of demand. In the short run, staple
demand is subject to highly volatile international commodity markets in which inelastic demand
leads to large fluctuations in prices and regional economic instability. In the long run, the non-
renewable staples are gradually exhausted, and renewable resources can suffer collapse caused by
unsustainable harvest rates (Clapp, 1998). The spatial manifestation of the dependent staple
economy is the emergence of isolated, single industry towns organized around the extraction of
staples. The vulnerability of these resource towns to downsizing and closures has been well
documented. The emergence of single industry towns is an inevitable characteristic of a staple
economy, and while ―there are periods of stability . . . it is never permanent‖ because ―destruction
and bedlam are always waiting in the wings‖ (Barnes, Hayter, and Hay 2001).
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According to the dependency school, governments are handicapped in their ability to manage staple
development because they are dependent on large foreign-controlled staple industries for regional
economic growth. Governments, therefore, are in a weak bargaining position with large foreign
owned firms, which have superior knowledge and bargaining power by virtue of their control of
savings, investment, technology, and markets. The role of governments in staple regions is
restricted to facilitating staple development by supplying subsidized high-cost infrastructure to
extract the staple and providing access to staples on highly favorable terms (Clark-Jones, 1987).
This restricted role of governments intensifies the problems of staple base. The staple economy will
experience financial crises as volatile export revenues are insufficient to cover fixed-debt charges
incurred to finance the extraction of staples, and ultimately will collapse when the staple is
economically or physically exhausted.
The pessimistic conclusion of the dependency school is that staple-led growth is a high-risk
development strategy that cannot provide the basis for sustained regional growth and development.
Prebisch (1963) specifically condemned the role of staples owing to their structural constraints,
which included the long-run decline in staple prices, low income elasticity of demand for staple
products, and the poor bargaining power of staple regions. The preferred strategy was to abandon
staples in favor of manufacturing through import substitution and high tariffs. Girvan (1971)
illustrated additional pitfalls in staple-led growth in his analysis of the failure of staple-producing
regions to develop production linkages because of the oligopolistic structure of multinational
capital.
The New Synthesis

The existence of the above two traditions in staple theory has produced a dialectical interplay
between the pessimism of the dependency tradition that staples have a pathological disorder that
inevitably leads to crisis and the qualified optimism of the comparative-advantage tradition that
staples are an important asset in the development process. The product of this dialectic can produce
a synthesis that combines the constraints of staple-led growth identified in the dependency position
with the strengths identified in the comparative advantage position to form an integrated framework
that exhibits elements of both traditions. Watkins‘s (1963) pivotal exposition of staple theory is a
good example of this synthesis.
Like Mackintosh (1964), Watkins saw staples as a potential leading sector that provided a
comparative advantage for resource-rich countries in the development process. Watkins described
how a diversified economy could evolve from a narrow staple export base through a series of
linkage effects. But like Mackintosh, he identified a number of challenges that could impede
development and drive the economy into a staple trap. Watkins cited many of the obvious
impediments, including the production function of the staple, which determined what potential
linkages existed; export demand; and the quality of the resource base. He also acknowledged the
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impediment recognized by both Innis (1956) and Mackintosh that staple economies had a
propensity for being overly optimistic and building costly surplus capacity.
Watkins also identified several more challenges of staple. The first challenge is the development of
an export mentality that results in the over concentration of entrepreneurship on the staple sector at
the expense of other sectors. The second challenge is the leakage of income to foreign owners that
reduced final demand linkage in the staple region. The third challenge is the reliance on foreign
technology, which could be advantageous in providing skills, but could also impede the domestic
sector by discouraging the development of indigenous technological capacity. Watkins emphasized
that staple regions are believed to be much more at the mercy of destiny than they actually are and
that the key is to avoid pitfalls of staple-led growth by developing the linkages necessary to
diversify the economy.
Implications of Staple Theory for Regional Policy

The principal implication of staple theory for regional development policy is that regions with a
natural resource endowment should concentrate their efforts on realizing the comparative
advantage offered by staples relative to other economic activities. Staple development poses
challenges, but the net benefit equation favors staples over other economic options, which also pose
challenges without the offset of resource rent. Realizing these benefits requires assiduous/diligent
management of resource development by the state. Accordingly, the two key policy initiatives are:
the collection of rent by the public owner and efficient management of resource development.
Several studies reveal that the collection and recycling of rent back into the staple region is a
complex activity. Results from case studies as well as other studies on rent-collection strategies
provide some guidance.
First, rent collection techniques must be sensitive to market cycles and collect only the residual that
remains after allowing normal returns to capital and labor. Royalties based on rate of-return
systems, competitive bidding, and strategic public ownership are the preferred techniques.
Otherwise, rent collection could increase instability by collecting too much during downturns,
thereby contributing to contraction in the industry and collecting too little during upturns, thereby
increasing leakage.
Second, because rent is the most volatile revenue stream from staples, care should be taken to
ensure that rent recycling is based on a long term average income stream. Auty (2001) noted how
rents during peaks are locked into financing ongoing expenditures that create fiscal stress for the
staple economy when the rental income declines. Mechanisms, such as placing resource revenues
in a special resource-stabilization fund separate from general revenue streams, are recommended
for consideration. Measures to improve efficiency, particularly in the private sector, are also
challenging. There are several key points. First, there has to be a better appreciation of the
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fundamentals of resource commodity markets and the psychological propensities of investors. The
nature of resource development, with its long lead times to develop new supply and high fixed
costs, produces commodity cycles that are characterized by extended booms followed by declines
as new supply emerges and substitutes are found. These booms lead to the formation of excessively
optimistic expectations, which stimulate new entrants with minimal experience who build
uneconomic capacity and purchase existing capacity at excess prices. Second, public policy in
resource development needs to be risk averse. Instead of fueling excess expectations by promoting
growth through financial incentives and investment in infrastructure, governments need to limit
their involvement. In those instances in which economies of scale and external benefits necessitate
public investment, such involvement should be contingent on independent reviews that are based
on the principles of full-cost recovery. Therefore, a policy of discouraging or being neutral toward
private-sector investment, instead of the usual approach of the aggressive promotion of investment,
would have resulted in substantially higher benefits. Finally, governments must be more aggressive
in collecting rents from the resource sector, both to encourage efficiency and to achieve an
equitable return for the public owner.
3.2.2 Theories Based on Demand and Markets: Economic Base Theory
The economic base theory is one of the approaches to the explanation of regional growth and
development. The central idea of this theory is that some activities in a region are peculiarly basic
in the sense that their growth leads and determines the region‘s overall development. The other
(non-basic) activities are simply consequences of the region‘s overall development. If such an
identification of basic activities can really be made, then an explanation of regional growth consists
of two parts:
1) Explaining the location of basic activities, and

2) Tracing the processes by which basic activities in any region give rise to an accompanying
development of non-basic activities.
The usual economic base theory identifies basic activities as those that bring in money from the
outside world, generally by producing goods or services for export. The argument advanced by this
approach is that a region, like a household or a business firm, must earn its livelihood by producing
something that others will pay for. Activities that simply serve the regional market are there as a
result of whatever level of income and demand the region may have achieved: they are passive
participants in growth but not prime movers. A household, a neighborhood, a firm, or a region
cannot get richer by simply "taking in its own washing"; it must sell something to others in order to
get more income. Consequently, exports are viewed as providing the economic base of a region‘s
growth.
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A regional economic base theory generally seeks (1) to identify the region‘s export activities, (2) to
forecast in some way the probable growth in those activities, and (3) to evaluate the impact of that
additional export activity on the other, or non-basic, activities of the region. The result is not only a
projection of the region‘s prospective growth and structural change but also a model that can be
used in evaluating the effects of alternative trends of export growth. It mainly focuses on firm‘s
productivity and location. It describes the economic relationships between hierarchies and
development is sustained through vertical and complementary linkages among industries. This
theory identifies three types of external relationships critical for regional growth and development,
namely trade (characterized as imports and exports of goods and services); migration of people (in
their capacities as both consumers and workers); and migration of other factors, principally capital
for investment.
It further suggests that economic activities of a region can be divided between industries producing
goods and services for export and industries producing goods and services for local consumptions.
The economic development of a region depends upon its ability to raise the volume of exports and
to continue in doing the same relative to consumption of locally produced goods and services. This
requires attracting capital and skilled labour essential for sustaining its development.
A region‘s export activities can be determined with various degrees of precision. The simplest and
crudest procedure is simply to assign whole industries or activity groups to the export or non-export
category without making a specific local investigation. Thus, retail trade, utilities, local government
and services may be classed en bloc as non-export, while manufacturing is considered wholly an
export activity.
A more sophisticated approach is to recognize that almost all activities in a region produce partly
for export and partly for the regional market, and to try to estimate how much of each activity is for
export. A community with a large number of packing plants is also likely to have a large number of
tin can manufacturers. Even though, the cans are locally sold, they are indirectly tied to exports.
Location quotients will show them as exports.
A more painstaking procedure of determining a region‘s export activities is to get information on

actual shipments of goods and services out of the region. In recent years, progress has been made
by the census in collecting and organizing data on manufacturers‘ shipments between large regions.
For some time, however, there will continue to be a dearth of information on exports from smaller
regions such as individual metropolitan areas or countries; and exports of some services pose
additional data problems. Many economic base studies have canvassed at least a sample of the
firms that are believed to be involved in exporting, in order to get a reasonably accurate measure of
the region‘s external trade.
The view of export demand as the prime mover in regional growth raises some interesting
questions that indicate the need for a more adequate explanation. Consider, for example, a large
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area, such as a whole country, that comprises several economic regions. Let us assume that these
regions trade with one another, but the country as a whole is self-sufficient. We might explain the
growth of each of these regions on the basis of its exports to the others and the resulting multiplier
effects upon activities serving the internal demand of the region. But if all the regions grow, then
the whole country or "super region" must also be growing, despite the fact that it does not export at
all. It appears, then, that internal trade and demand can generate regional growth. That is a region
really can get richer by taking in its own washing.
In the mechanism of the regional export multiplier, expenditures for imports represent demand
leakage from the regional income stream. The greater the proportion of any increase in regional
income that is spent outside the region, the smaller is the multiplier. Then, it follows that if a region
can develop local production to meet a demand previously satisfied by imports, this "import
substitution" would have precisely the same impact on the regional economy as an equivalent
increase in exports. In either case, there is an increase in sales by producers within the region.
It is important to remember that it is quite incorrect to identify a region‘s export activities

exclusively as the basic sector which can generate regional growth. It would be more appropriate to
identify as basic activities those that are inter-regionally footloose (in the sense of not being tightly
oriented to the local market). This definition would admit all activities engaging in any substantial
amount of interregional trade, regardless of whether the region we are considering happens to be a
net exporter or a net importer. Truly speaking, basic industries would be those for which regional
location quotients are either much greater than one or much less than one. This necessary
amendment to the export base theory, however, exposes a more fundamental flaw. We are still left
with the implication that a region will grow faster if it can manage to import less and that growth
promotion efforts should be directed toward creating a "favorable balance of trade", or excess of
exports over imports. Let us examine this notion further more in details.
If a region‘s earnings from exports exceed its outlays for imports, on net there is an exodus of
productive resources from the region (as embodied in goods and services traded). In this sense the
region is loaning its resources to other areas, and its people and businesses are building up equities
and credits in those areas. Thus, the region is a net investor, or exporter of capital. By the same
token, if imports exceed exports, the region is receiving a net inflow of capital from outside. Hence,
it is patently meaningless to argue that the way to make a region grow is to invest the region‘s
savings somewhere else, and that an influx of investment from outside is inimical to growth. If
anything, it would seem more plausible to infer that a region‘s growth is enhanced if its capital
stock is augmented by investment from outside which means that the region‘s imports exceed its
exports. In short, in any event, regional development is normally associated in practice with
increases in both exports and imports.
3.2.3 Theories Based on Concurring Space
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It has been discussed about the conventional theories of regional growth which comprises theories
based on resources and supply, and theories based on demand and market. Besides, there are many
other theories of regional growth based on concurring space: growth center theory, cumulative
causation theory; core periphery theory and agropolitan development theory.
2.3.1 Growth Pole or Growth Center Theory
One of the regional growth theories based on concurring space is the growth centre theory. This
theory was introduced by Perroux in 1955. Perroux coined the term ‗growth pole‘ or ‗growth
center‘ with the primary concern intended to promote interactions among industrial sectors rather
than spatial development processes. He distinguished the concept of growth center/pole and
hinterland within the context of regional development. Growth pole/center: are urban or extended
metropolitan areas, also called ‗urban fields‘ containing also of expanding economic activities
which induce from which growth further economic development throughout its hinterlands.
Hinterlands, on the other hand, cover an area outside the urban fields.
The theory argues that with limited resources, it would be inefficient and ineffective to attempt to
sprinkle development investments thinly in all sectors or across all regions rather key urban canters
should be selected for concentrated investment programs that would benefit from economies of
scale and external economies of agglomeration. It further argue that Economic growth doesn't
appear everywhere at the same time rather economic growth manifests itself in growth pole/center,
with variable intensities, then growth spreads by different channels and with variable terminal
effects for the economy as a whole.
According to Perroux development in hinterlands is fueld by expanding metropolitan centres. That

is investment trickles out from the growth center/pole to the hinterlands. However; empirical
studies reveal that the innovation diffusion process and the spread effects to the hinterlands are
minimal and highly discontinuous in spatial terms. Perroux emphasised the importance of
entrepreneurial innovation in the process of development which succeeds by dynamic sectors or
pole through time. He also stress on few dynamic sectorial clusters as well as on urban-industrial
growth as key to regional development.
2.3.2 Cumulative Causation Theory
Cumulative causation theory is another theories of regional growth based on concurring space. This
theory is developed by Myrdal in 1957. In his work, Myrdal distinguished the existence of leading
and lagging regions in the process of regional/spatial aspect of development. The concepts of
leading-lagging distinguish advanced/developed regions from the underdeveloped/backward
regions both at the global and regional levels.
Myrdal used the concepts of ‗‗backwash‘‘ and ‗‗spread effects‘‘ to explain the results of leading
and lagging regions relationships. He argues that leading regions possesses comparative advantages
due to its location, infrastructures and other factors of development. Ever increasing investment in
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the leading regions results in agglomeration. These will further promote development in the leading
regions. In contrast, little investment/development incentives/ moves to lagging regions due to its
comparative location, shortage of infrastructures and other resources. The elites of leading regions
control investment in the lagging regions to ensure the economic dominance of their respective
regions. Myrdal also argues that development in lagging regions are further inhibited because of
‗‗the back wash effects‘‘ and other barriers.
The' back wash effects‘‘ involves the phenomenon of population migration, trade and capital
movements to the leading regions; skilled workers, business leaders and venture capital will move
from the hinterlands (lagging regions to the growth pole (leading regions) to seek high returns as
the result of increased demand available at the growth center or the leading regions. Goods and
services produced in the leading regions are sold to the lagging regions at low prices that the local
industries in the lagging regions cannot compete and which in turn the growth of local industries.
Therefore, such ‗‘backwash effects‘‘ create the tendency of an increased inequality b/n the leading
regions and the lagging regions.
Although, it takes long time, there is a propensity of ‗spread effects‘ that may counter the
‗‘backwash effects‘‘ that emerge as the result of the relationships between the two regions. This is
because one feature of leading regions is that they tend to spread out in to lagging regions. In
addition, most lagging regions have comparative advantage principally, in natural resources that
result in positive investment flow in to the lagging regions. Therefore, increased outlets of
investment opportunities for lagging regions‘ agricultural products; raw materials and a tendency of
technical advancement to diffuse from the center will be imminent.
Myrdal concludes that cumulative causation (i.e. development) will happen in the lagging regions,
when the spread effects is stronger than the backwash effects where as the reverse situations will
adversely affect the process of development in lagging regions but it is positive for the leading
regions.
2.3.3 Core Periphery Theory

The theory of core periphery was developed by Friedman in 1972. He made an attempt to formulate
the systematic and comprehensive core periphery model. The core periphery concept distinguishes
b/n regions of a global scale, while regions can be composed of the entire nations or collections of
states. The theory involves not only the matter of the national economic development of individual
countries or regions but also a significant and highly integration of international dimensions.
According to this theory, development originates in a relatively small number of ―center of

changes‘‘ located at the points of highest interactions. Then innovations diffuse from these centres
(origin) to dependent areas of lower interactions. Friedman argued that regional development is the
result of the creative potential of a society through a successive series of structural transformations.
It assumes that development occurs through a continuous & cumulative process of innovations. He
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suggests that the creations of multinational firms on a continental basis as a preconditions for more
rapid diffusion of innovations in developing countries. In general Friemann‘s theory assigns a
decisive influence/role to the institutional and organizational arrangements of a society.
It has been noted that the growth center theory assumes that development starts only in few
dynamic sectors and geographical clusters from where it will spread to the remaining sectors and
geographical locations. On its part, the core periphery theory argues that the trickle down process
essentially supposed to start at the global level (from the world innovation centres) and then filter
down and outward to national or regional units through the urban hierarchy, inputs and outputs
relations; channels of multinational business organizations or large scale government organizations.
Therefore, this theory emphasis urban and industrial capital intensive development; the highest
available technology; and maximum use of external and scale economies. This usually involves
large investment projects; increasing units of functional and territorial integrations; increased scale
of the private and public organizations required to transmit innovations through these integrated
units and reductions of economic, social, cultural, political and institutional barriers which might
hinder the transmission of innovations within and between these units.
Section 3: Contemporary Approaches & Perspectives on Regional Development

The theories discussed so far were conceived on the basis of recourses, demand and supply and
concurring space. In this section, you will learn about the contemporary approaches & perspectives
on regional development. Some of this approach and perspective includes endogenous growth
theory; basic need approach and learning, innovation and regional development and theory of
Entrepreneurship.
3.3.1 New Growth Theory/Endogenous Growth Theory

New Endogenous growth theory is an alternative development approach to the unsuccessful
externally induced and standardized development approach, propagated by international
organizations like WB, UNDP, and IMF. This theory is also known by various names like ‗‘self
reliant theory‘‘, or ‗‘new growth theory‘‘. Endogenous development model is relatively a self
sustaining model capable of transforming the local economic system based on local characteristics.
It emphasis the necessity of building ability of a region to control certain fundamental resources
like ensuring the use of local resources for local development (capital, entrepreneurship, material
resources); the ability to check the accumulation process; the ability to innovate & developing of
productive interdependence between firms and economic activities.
Proponents of the endogenous development theory advocate:
Reducing dependence on imported goods and services by import substitutions;
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 Changing in the consumption patterns of the local people from imported goods to endogenous
products;
 Improving regional/local capacity for negotiating with transnational corporations;
 Expansions of internal markets (regional and inter-regional) which should be covered with local
products to solve specific problems & to provide goods & services to the local people;
 Promoting efficient production & distributions through a proper functioning prices system and
efficient and sustainable uses of natural resources;
 Developing human capital of a region/nation and mobilizing internal and external resources
necessary for local development and wisely using these resources.
In general, Endogenous growth theory has played a central role in the growth debate since the
1990s. The main idea of this theory is that technological progress is not exogenously given, but a
self-organized response of individual agents in an entrepreneurial business environment.
Consequently, the emphasis is much more on firms‘ individual economic behavior. In this way, it
can be demonstrated that regional growth is not the result of exogenous productivity-enhancing
factors but rather is the result of deliberate choices of individual actors (firms and policy makers). It
is noteworthy that the identification of endogenous determinants of growth was the crucial
scientific issue that explained the birth of regional development theories.
Development is in fact by definition endogenous. It is fundamentally dependent on the concentrated

organization of the territory, embedded in which is a socio-economic and cultural system whose
components determine the success of the local economy: entrepreneurial ability, local production
factors (labour and capital), and the relational skills of local actors. All these generate cumulative
knowledge acquisition & moreover, a decision-making capacity which enables local economic and
social actors to guide the development process, support it when it is undergoing change and
innovation, and enrich it with the external information & knowledge required to harness it to the
general process of growth, and to the social, technological and cultural transformation of the world
economy.
3.3.2 Need Based Development Approach
The basic need development is a new line of development thinking advocated by those who try to
redress the meaning and purpose of regional development in the context of human welfare. As
alternative development approach, BND is a relatively recent phenomenon that emerged as the
result of the failure of the other approaches & strategies. It took over dominance in the
development discourse and practices since the mid 1970s.
According to Chambers (1994) this period has been marked by a shift in development approaches
from ‘‘top down to bottom up development approaches‘‘; ‗centrally planned to local diversity‘,
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‗blue print to learning processes. This fundamental shift in the development approach is variously
referred in literatures as: Another development‘; ‗alternative development‘; people centred
development‘; community based development and participatory development approaches. Need
based development is aimed at meeting the basic needs of human beings and improving standards
of living in a wider perspectives. It seeks to ensure sustainable regional development and realizing
poverty alleviations; give due attention to poverty eradication, employment creation, income
distributions and the provisions of basic services to people. That is, its goal is to empower the poor.
Empowerment refers to enabling the poor to take direct control over the circumstances of their own
lives so that they are in positions to become their own development agents in the future. According
to Chambers (1993) empowerment means that people enabled to take more control over their lives
and secure a better livelihood with ownership and control of productive assets as one key element.
From the empowerment point of views, the purpose of community Based development is enabling
poor people to achieve all life necessities. The general belief is that through empowerment
individuals, communities, and nations could obtain collective responsibility for their own future
and manager of their own development; imply the formulations of strategies to ensure poverty
alleviations & sustainable development; and Implies changing the patterns of controlling resources
and political power as the attainment of self reliant development and determinations of their own
destinies by the disadvantage groups.
NBD is also known as Community Based Development. Accordingly, Hope (1995/6) referring
CBD as a process that involves social and economic actions for solving local problems by
combating efforts and resources of various stakeholders.CBD needs understanding of the basic
social and economic problems of a given community and then taking necessary actions to solve it.
It is intended to achieve progress in the living standards, achieving economic growth, generations
of wealth and the use of regional resources on a continuous and sustainable manner.
Community based development emphasis the adoptions of need oriented regional strategies which
focus on the establishment of small scale projects which can increase social and economic access
for the disadvantaged groups/regions & be managed and easily duplicated. This project should be
adaptable to local conditions (knowledge, skills, technology etc) & be community owned and
directed so that they can create local self reliance. As instruments to Need Based Development,
projects should be demand driven & be targeted towards poverty alleviations, employment creation,
raising incomes, and increase availability of basic services.
3.3.3 Learning, Innovation and Regional Development

A resurgence of interest in the region as a scale of economic organization and political intervention
has been apparent within economic geography and regional development studies over the past
decade. At first sight, this seems paradoxical, given the prevailing emphasis on globalization as
perhaps the political and economic metanarrative of the 1990s (Held and McGrew, 2000). In many
ways, however, it is precisely this tendency for production and finance to become increasingly
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globalized that explains much of the renewed concern with regions. As a consequence, national
economic coherence has been undermined, reducing states‘ control over flows of investment and
directly exposing regions to the effects of international competition. This has focused attention on
the need for regional-level intervention if regions are to be able to shape their own development
prospects in a climate of rapid technological change and increased capital mobility (Amin and
Thrift, 1994).
In view of the apparent shift towards a ‗knowledge driven economy‘, the capacity of regions to
support processes of learning and innovation has been identified as a key source of competitive
advantage. The concept of ‗learning regions‘, emphasize the importance of knowledge and
learning. The proliferation of these concepts reflects a focus on social and institutional conditions
within regions in terms of how they shape processes of economic development (Hudson, 1999).
The shift of interest in agglomeration and new industrial spaces into a focus on ‗learning regions‘
during the 1990s, is indicative of a general shift towards a broader concern with the social and
institutional foundations of regional development.It is the emphasise the importance of locally
specific social and institutional factors in shaping economic development, particularly in terms of
supporting innovation & entrepreneurship through the development of collaboration and trust
between firms & organizations (Morgan, 1997).
The concepts of ‗learning regions‘ and ‗clusters‘ have attained hegemonic status within
contemporary regional development discourses. In a climate of increasing globalization, the turn
towards neoliberal forms of regulation has exposed regions to increased competitive pressures. This
has created a demand for new concepts and models of development which offer guidance on how to
increase competitiveness and foster innovation, as regional agencies strive to promote and defend
the interests of ‗their‘ areas in the face of increasing competition for investment and resources
(Tickell, 1994). Many empirical studies share a concern with tracing the mechanisms by which
knowledge is generated and circulated within regional production systems. In general, researchers
identified three key mechanisms of learning relating to the extent of local spin-off from existing
organizations through the formation of new enterprises, the level of inter firm interaction, & flows
of skilled personnel between firms (Keeble et al., 1999: 324–26).
Accounts of learning regions and innovative milieux share a concern with the creation of
sustainable localized advantages in the face of increasing global economic integration. The learning
region concept has evolved from a set of essentially ‗top-down‘ prescription of the links between
innovation and economic success against a background of globalization. More specifically, the
notion of learning regions can be seen to have emerged out of a concern to channel insights from
the broader literature on national systems of innovation into a ‗new regional science‘ (Cooke et al.,
1998). one of the problems associated with the transfer of ideas about learning and innovation from
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national to regional levels concerns the failure to recognize the specificity of the ‗nations‘ and the
‗regions‘ as distinct scales of political-economic organization.
While questions of knowledge creation and regional development have been addressed from a
range of perspectives (Storper, 1997), it is worth detailing the common propositions apparent in the
literature on learning regions.
First, globalization is actually held to be associated with the emergence of new forms of
agglomeration based around knowledge creation (Storper, 1997). In a world where increasing
efforts are made to codify knowledge and make it ubiquitous or cosmopolitan those places that
become the repositories for tacit specialized local knowledges can derive considerable advantages.
Second, there is claimed to be an increasing tendency for these non-material advantages, rooted in
sets of social relations between firms and institutions, to be located at the regional rather than the
national level (although different authors emphasize different scales). Such ‗relational assets‘ or
‗untraded interdependencies‘ are seen as key sources of learning which enable certain regions to
respond and adapt effectively to changes in the external market environment and increase their
competitiveness.
A third feature is that tendencies towards agglomeration in learning regions are associated with
increased sectoral specialization. The increased importance of knowledge as a source of
competitive advantage is likely to increase the tendencies for clusters of specialist and related
industries to develop in particular places. The importance of ‗being there‘ in the form of
geographical proximity to related firms and industries, is likely to be strengthened because of the
need to access tacit knowledge within everyday production processes. This proposition rests upon
an important distinction between tacit and codified forms of knowledge.
While codified knowledge can be easily traded or communicated through markets and hierarchies
and can in principle become universally available where as tacit knowledge is much ‗stickier‘,
being embedded in production practices and the ‗know-how‘ of particular firms and workers. The
key claim made by advocates of the ‗learning region‘ is that the increased emphasis on tacit
knowledge makes spatial proximity between associated producers more important, since this form
of non-codified knowledge is best transmitted and developed through close interpersonal and inter-
firm relations.
A fourth point is the emphasis that is placed upon the importance of collective learning processes
in stimulating agglomeration. The concept of collective learning needs to be differentiated from
simple learning that involves bilateral cooperation. It is referring to cumulative learning processes
that take place over time among a community of firms in a locality. These learning processes
require a degree of continuity and stability in inter firm relations which is likely to be facilitated by
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spatial proximity. As collective learning processes develop, information about knowledge creation
becomes a ‗public good‘ in the sense that innovations become available to the universe of firms
within a network and not just to those who generate the original ideas.
Localized forms of collective learning can only be sustained over time if firms continue to
participate in this open exchange of knowledge and ideas. There are strong incentives encouraging
such participation, particularly for smaller firms which generally lack the knowledge and scale
economies of larger firms. In particular, it is argued that innovation can be seen as a process of
collective learning where complementary forms of knowledge are combined. Lawson and Lorenz
(1999) argue that innovation often involves specialists bringing together different tacit knowledges
to create new forms of knowledge greater than the sum of the constituent parts.
The establishment of trust between actors/firms is considered to be critical to collective learning

activities. Such relations of trust extend beyond the dynamics of individual optimization which
form the basis of neoclassical conceptions of economic exchange. Firms within high-trust business
networks benefit from the reciprocal exchange of information and knowledge, but at the same time
are bound by ‗strong ties‘ of obligation which regulate behaviour and prevent ‗malfeasance‘
(Granovetter, 1985).
In this way, trust is conceptualized as a key form of ‗glue‘ which binds networks together and
sustains firms‘ involvement in processes of collective learning. An important implicit claim in the
learning region literatures is that geographical proximity between associated firms and producers is
more likely to generate such high levels of trust than more dispersed relations. The emphasis on
trust reflects the growing importance of inter firm networks as sources of learning and competitive
advantage.
At the level of policy, it is argued that the learning region concept can be applied to less favoured
regions as well as more advanced ones (Florida, 1995; Morgan, 1997). Incremental notions of
innovation suggest that branch plant and low technology regions will also be repositories of forms
of practical know-how that have the potential to provide localized competitive advantage. It is
argued that the task for less favoured regions is to develop better learning capabilities, predicated
upon their collective ability to develop more reflexive ‗rationalities of action‘ (Amin, 1999). In
general, the argument that learning and knowledge creation are imperatives for all firms and
regions is widely accepted, and strong claims are made about the relevance of learning concepts for
less favoured regions (Morgan, 1997).
3.3.4 Entrepreneurship Theory
The accumulation of factors of production such as knowledge, physical or human capital cannot
alone explain economic development. They are necessary inputs in production, but they are not in
themselves sufficient for economic growth to occur. Human creativity and productive
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entrepreneurship are needed to combine these inputs in profitable ways, and hence an institutional
environment that encourages free entrepreneurship becomes the ultimate determinant of economic
growth. Thus, the entrepreneur and entrepreneurship should take center stage in any effort to
explain long-term economic development.
The characteristics of entrepreneurial economy are high level of innovation combined with high
level of entrepreneurship which results in the creation of new ventures as well as new sectors and
industries. It emphasis the identification and perception of economic opportunity, the existence of
technical, organizational and behavioral skills, managerial competence, and motivation to achieve
results.
Entrepreneurship is defined as‘‘... the process of identifying, developing, and bringing a vision to
life. The vision may be an innovative idea, an opportunity, or simply a better way to do something.
The end result of this process is the creation of new venture, formed under conditions of risk and
considerable uncertainty. Entrepreneurship is business idea generation and implementation by
taking in to account the technological, geographical and sociological factors. The start up of
entrepreneurship could be opportunity driven or necessity driven of the combination of both
opportunity and necessity.
The economists assume that the factors of production possess a high degree of mobility; that inputs
and outputs are homogenous, and that producers; consumers and resource owners have knowledge
of all the possibilities open to them. As is well known, in an underdeveloped country such ideal
conditions do not exist. As such, the entrepreneurship envisaged by economists cannot be
developed in such a country by considering the economic dimensions alone.Schumpeter‘s concept
is a synthesis of three different notions of entrepreneur i.e. a risk bearer, innovator and a
coordinator cum manager. He assigned the role of an innovator to the entrepreneur and not to the
capitalist. Capitalists supply capital and entrepreneurs constantly innovate and are usually the large-
scale business persons. He stated that ‘whatever the type, everyone is entrepreneur only when he
actually carries out a new combination and loses that character as soon as he has built up his
business, when he settles to running it as other people run their business‘.
There are two types of theories termed as gap filling theories; the sociological approach, which
suggests that as a result of withdrawal of status, some social classes will work to fill the void and be
more entrepreneurial. The other is an economic approach which implies entrepreneurs fill up the
gaps in the market. Leibenstein postulates that the entrepreneurs are gap-fillers i.e. they have the
ability to perceive where the market fails and to develop new goods or processes that the market
demands but which are not currently being supplied. This can be regarded as a special kind of
innovation. He assumes that entrepreneurs have the special ability to connect different markets and
make up for market failures and deficiencies. Leibenstein also suggests that entrepreneurs have the
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ability to combine various inputs into new innovations in order to satisfy unfulfilled market demand
(Leibenstein, 1995).
Peter F. Drucker (1985) defines an entrepreneur as a person who looks out for any changes,
responds to it and exploits the opportunity generated by the change. It may mean provision of a
new business, new product or a new service. He feels that a resource becomes an economic
resource only when somebody finds a use for it. Some thinkers suggest that the entrepreneurs are to
be found in the social sectors e.g. NGOs as well, and are called Social entrepreneurs. They are an
agent of change and help increase the standard of living. Some other thinkers have identified
Entrepreneurs, who perform all the functions of entrepreneurs, but are not the risk bearers as they
are employed in some organizations. These people innovate, go through all the labor pains of
creating new divisions within existing organizations, they do not bear the risk, or uncertainty, and
also may not get any reward in proportion of the success of the new venture/ division but they
certainly are agents of change in the organization.
Different economists assign different important roles to the entrepreneurs. In general the following
are some of the important role entrepreneurs play in the economy.
 Creation of job opportunity;
 Identification of business opportunities and markets;
 Introduce better techniques of production;
 Create better utilization of the available resources;
 Abolition of monopoly and enhancement of competition;
 Increase in per capita income and outputs and generate or save foreign currency.
3.5 Agropolitian Development Theory
This theory argues that regions/nations themselves have to determine the kinds of economic and
social development that is desired by a particular region. The theory believes that development
mainly occur from internal sources. Advocators of this theory argue that only by preserving cultural
regionalism would a regional society have a chance to carry on industrializations with its tendency
to force cultural conformity with the industrial interests. They propose regional /national planning
that would formally create autonomous organic territories that would be defined by natural
resources, climate certain historical elements, cultural traditions, and social structures. This theory
aims at self-sustaining regional/local development through the supposed ability to transform the
socio-economic system; react to external challenges and the formulations of social learning
&specific forms of social regulations at local level. It also favours export base industries that have
potential to raise quality of local life and production of goods and services.
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First, the theory assuming greater control & manage over renewable natural resources to sustain
yields and thereby assure permanent economic base. In less developed regions with surplus labour
and sufficient capital, agropolitian theory, suggest the establishment of labour intensive
technologies to use local resources/natural resources. Moreover, it argues that efforts would be
made to support local industries to provide goods and services locally that would otherwise be
imported. High way Infrastructures would be built to improve accessibility within the agropolitian
areas not necessarily between agropolitian regions and growth centres. Encourage those export base
industries that improve the quality of local life and development and discourage those export base
industries that exploit local resources but do not improve the quality of local life. Encourage
Investing local savings in to local opportunities even when the returns of the investment may be
less that returns earned by investing outside the agropolitian region. Efforts would be made to
create a social consciousness towards common benefits and development goals.
Unit Four
Policies and Strategies of Regional and Local Development

Section One: An Over View of Regional Development Policy
The formulation of public policies on location and regional development was stimulated in the
second quarter of this century by continuing interregional disparities in income and economic
opportunity by the increasing role of the national government in financing & providing regional
services, by disenchantment with population increases as an objective & with competitive regional
subsidization of growth & by changes in factors affecting location. Nowadays, there is a shift in the
paradigm of regional development with respect to theory, policy goals and implementation
mechanisms.
The traditional approach to regional development was undertaken by central governments using the
levers of subsidies to firms, infrastructure and the location of public sector activity. In part, this has
been superseded by a ‗contemporary‘ approach, characterized by decentralized intervention based
on integrated regional development plans and strategies, designed and delivered by partnerships of
regional and local actors. In this section, we will discuss about policies of regional development. It
highlights the paradigms approaches to regional development; the concerns of contemporary
regional development policy; the emergence of problem regions and finally, the tools for
influencing regional development in the desired directions.
1.1 Changing Paradigms of Regional Development Policy
Nowadays, regional development policies have been undergoing a shift in ‗paradigm‘. It is argued
that there has been a fundamental change in all aspects of how regional development is
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conceptualized and how regional policy is conceived and delivered. This shift begins with the
theoretical underpinnings of regional development and the factors that are considered to explain the
geography and economy of development. It proceeds through the aims, objectives, sphere of action
and mode of operation of policy, and is evident in the changing organization of how policy is
developed, managed, delivered and evaluated. However, the shift is by no means universal; not
everyone subscribes to the new theories of regional development. Nor is it complete; in many
countries and regions, the shift in policy is partial and may turn out to be transient.
The central pre-occupation of regional policy makers at this time was regional convergence –
reducing economic disparities between regions, especially core- periphery differences.
Conceptually, regional policies were based on traditional theories of regional development. The
common characteristic of these theories was that they were concerned with explaining variations in
the location of economic activity with reference to the attributes of regions or urban areas, such as
the cost of land, transportation costs, market size and the availability of workers. Policies to reduce
disparities were, therefore, generally developed to influence these factors e.g. reducing investment
or employment costs, subsidizing transport costs, providing cheap land and premises in the problem
areas, while (in some cases) increasing the costs of development in the core or congested areas.
The major issues of concern to regional policy makers were primarily underdevelopment and
depopulation in rural areas. In addition, regional policy also attempted to address problems of
geographically concentrated unemployment. The main policy objective was equity, equalizing
variations in standards of living, infrastructure or employment across the national territory. Problem
areas were designated on the basis of administrative or data collection units generally suffering
from slow economic growth, low incomes and high unemployment. In these regions, policy
instruments comprised four main types: financial incentives in the form of grants, loans, tax
concessions, depreciation allowances, employment premia, removal cost allowances, transport
subsidies, labour-training aids and rent subsidies; infrastructure investment, especially in rural and
sparsely populated areas; the use of investment targets or other social obligations on the part of
state-owned or state-controlled industries; and the diversion of development from congested areas
through development controls on manufacturing industry or the relocation of private and public
sector offices. A particular focus in some countries was on growth centers, serving as a focus for
geographic concentrations of public investment & stimulation of growth opportunities which would
then spread to the surrounding areas.
During the 1980s regional development policy moved against active government intervention,
especially through subsidies to firms. First, the policy focus shifted towards privatization,
deregulation and the liberalization of markets. In a number of countries, the effectiveness of
regional policy was questioned & criticized. Regional policy moved progressively downgrading the
policy goals of reducing disparities and promoting regional convergence. Policy took on more
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limited objectives, focusing in some countries on the maintenance of settlement structures in
sparsely-populated areas, in others on attempting to ameliorate the economic and social
consequences of job losses in those regions suffering the highest levels of unemployment and, in a
few, on the attraction of inward investment to the problem regions.
Second, the ‗retreat‘ of central government from active regional and industrial policies was
accompanied by the rise of a new regional and local dimension to economic development. This was
partly attributable to regional institution-building which accompanied the increasing delegation of
authority for certain economic development activities with a view to enhancing local identification
with policies and increasing local responsibility for economic development. The trend was also due
to a growth in ‗bottom up‘ initiatives, as local authorities and other groups began to develop and
implement their own measures to deal with growing economic and social problems. Third, regional
policy thinking was shifting towards the promotion of endogenous development with a
(re)discovery of the importance of entrepreneurship and small and medium enterprises. Moreover,
technology was increasingly seen as decisive factor for growth and prosperity.
Fourth, from the mid-1980s onwards, new concepts of regional development began to be evident.
The competitiveness of economies was increasingly attributed to the ability to innovate,
particularly within the context of environments that facilitated learning, interaction and networking
between enterprises. Technological & organizational changes were altering the way in which firms
organized their activities, both internally and with suppliers and customers. The progressive
removal of trade barriers and other constraints on the free movement of labour and capital was
leading to an accelerated internationalization of economic activity through foreign investment,
trade and inter firm links, such as acquisitions and mergers.
In this context, new theories of regional development came to the fore, especially those concerned
with industrial milieux and the role of clusters and networks. It was recognized that competitive
advantage increasingly implied the ability and capacity of regions to facilitate the generation,
acquisition, control and application of knowledge & information, in the interests of innovation and
marketing. The spatial interrelationships between organizations, for example, participation in
information & research networks, supply chains, SME collaboration & government-industry links
were recognized as critical. These dynamics necessitated the development of a more sophisticated
approach to improving both regional capabilities and attributes with measures that are socio-
cultural as well as economic. A new type of regional policy concerned with the strategic
management of regional development is termed as „contemporary regional policy‟.
Some of the characteristics of contemporary regional policy include the following. First, they have
a broad sphere of action, covering a range of policy sectors: physical and economic infrastructure,
business development, human resources, tourism, environment etc. Second, the national policy
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versions tend to encompass economic development in all regions, not just those designated for
regional policy purposes. Third, they tend to take a pro-active approach to development, with a
multi-annual programme of measures targeted at the business environment & soft infrastructures.
Lastly, they have a distinctive approach to policy implementation, led by regional authorities and
involving a wide range of partners from local government, voluntary sectors, business and social
communities.
1.2 How National Policy Help Regional Development: Regional Objectives in a National
Setting
It is important to recognize that regions are not self-contained or independent of one another. Thus,
a true concern of regional policy calls for a good understanding of the various forms of regional ties
and framing policy goals on a multiregional or national basis.
1.2.1 National High-Employment Policy and Regional Economic Adjustment

It is difficult to expect any satisfactory solution problem of unemployment and arrested
development except in the context of a prosperous national economy. In a depression period,
businesses are doing relatively little capacity expansion and have little difficulty in finding locally
the necessary labor, services, and space for such expansion as they want to undertake. Their
investment is more likely to take the form of cost-cutting improvements in existing plants, and this
may well involve closing down some branch facilities at the more marginal locations. Moreover, in
slack times, the surplus manpower in any area has literally nowhere to go and fewer resources to go
anywhere; we cannot look to labor migration for any significantly useful adjustment.
The national monetary and fiscal authorities have great powers to increase the nation‘s money
supply and disposable income and thus to stimulate spending and investment in the aggregate. Such
action helps to maintain the necessary buoyant climate in which constructive regional adjustments
by people and industries can occur.
1.2.2 Efficiency, Equity And Structural Unemployment
Some people feel that maintaining a high level of employment and demand in the economy is as
much as the national government should do in regard to regional economies. However, there are
two distinct arguments for other and more specifically, region-oriented national policies and
programs. The first argument call upon the criterion of efficiency, claiming that there are other
ways besides fiscal and monetary policy for facilitating effective allocation of resources among
regions and the necessary dynamic adjustments. The efficiency argument rests largely on the idea
of "structural unemployment." This type of unemployment comes about because there are wide
disparities in the employability of different groups in the labor force. There are poor matching
between the kinds of labor that are in demand and those that are available and there is insufficient
mobility and interchangeability within the labour force.
This makes shortages, rising costs and consequently inflation inevitable, while millions of the less
employable are still out of work. Obviously, any policies that will reduce these wide disparities and
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make manpower more mobile and interchangeable will have the good effect of shifting the
inflationary brink closer to the ideal of full employment. Therefore, there is a strong opt for public
programs involving education and worker training and retraining, and for more direct aids to spatial
and occupational mobility: for example, improved information about job opportunities, assistance
to migrants, and removal of racial and other discrimination in employment. Such efforts ought to
focus on upgrading the least advantaged types of workers and reducing their competitive handicaps.
The second argument is based on equity, claiming that the national government has a responsibility
for helping disadvantaged regions through provisions of subsides and grants.
1.2.3 Helping Regions Versus Helping People

It is persuasive to argue that if public policy should specifically help the less-advantaged classes of
people to find jobs, then it should by the same token seek to support the prosperity and growth of
all communities. Such a view has been pertinently characterized as substituting "place prosperity"
for the more fundamental objective of "people prosperity.”. The place prosperity doctrine
represents that whatever is true of individuals must also apply to areas. It argues that the best way
to help a person is to promote the overall prosperity of the area in which he or she happens to live.
Since people have some mobility, the best way to help disadvantaged people who are living in a
particular region may be to encourage them to move. Accordingly, they argue that migration can
serve both the objective of efficient use of resources and the objective of interpersonal equity and
distribution of opportunity. It is argued that in any community or region where there are
unemployed and needy people, there are also employed and prosperous people. Thus, increased
employment and income for the area as a whole may help those who need it most; but a large part
of its local benefits will come to those who do not need it. Generally property owners and the
operators of established locally oriented business. Growth of aggregate area income and
employment does not automatically mean improvement in per-capita income or the reduction of
unemployment and thus, it generally injures some while helping others. They conclude that such
considerations suggest that attacking human hardship and lack of opportunity, solely through place
prosperity, might be like using ‗‘a shotgun to kill flies‟‟.
1.2.4 Regional Rivalry and the National Interest

Like other forms of competitive promotion and warfare, regional rivalry contributing nothing to the
national welfare as one region‘s gain is another‘s loss. That is, it can be in large part self-defeating
or a "zero-sum game‖. This is especially more likely when the regions are small and when the
primary weapons are persuasion and subsidy. Resources such as capital and labor that are drawn to
one area cannot be used in production elsewhere, and from a national perspective there is no net
gain, unless the productivity of those resources is higher in the receiving region. Therefore,
regional growth must be generative rather than competitive. In this more positive light, efficiency
gains in each region may promote national prosperity.
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Harry Richardson argues that it is possible for national growth to be increased by faster regional
growth and it is possible for regional growth performance to be improved without additional
resource inputs. Agglomeration economies and spatial clustering of activities may induce more
output than if production is dispersed. A change in settlement pattern (a more efficient regional
urban hierarchy) or a reorganization of the intra-regional transportation system may improve
productive efficiency and promote faster regional growth.
Thus, enlightened local efforts to enhance a region‘s growth potential can result in significant net
benefits. The progressive local efforts to enhance regional growth and development may take
various forms. These include protecting and improving amenities; stimulating entrepreneurship and
innovation; fostering cooperation among various business, social, and political elements and
discovering the true comparative advantages of the region for generative development. All these
efforts favor better utilization of resources and are clearly in both the national and the regional
interests. Therefore, a logical national policy with regard to regional development should include
some efforts to channel the growth urge/support of regions into these constructive paths.
Regional rivalry in development can be something worse than a zero-sum game, if it distorts the
efficient allocation of resources. This danger is inherent in the use of local subsidies and most of all
with respect to the use or abuse of natural resources and the neglect of externalities. Competitive
regional development may involve regions in a competitive race to offer up for private exploitation
of their air and water quality. The resulting resource deterioration involves transfer of income from
local residents to business firms. Competitive tax concessions to attract development may also
result in relative weakening of the public sector. National policy in terms of the development of
specific regions can help to achieve more efficient use of natural resources as well as to reduce
regional unemployment and broaden human opportunity.
1.3 Regional Pathology: The Emergence of "Problem Areas"
Regional economic growth is not a smooth and straightforward process. The persistence of efforts
to explain development in terms of successive "stages‖ can be evidence of the existence of
important discontinuities. The development of a region, like that of a nation, encounters from time
to time, crucial situations in which its future course can be significantly influenced by major
planning decisions and policies.
"Problem regions" are of several different types, including backward areas halted at the threshold of
self-sustaining development; already developed areas with arrested growth due to loss of
competitive advantage in their basic activities or obsolescence in those activities as such, with
accompanying loss of ability to substitute new kinds of activities and areas of excessive growth or
excessive concentration. Let us further considers these problem regions in a more details.
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2.3.1 Backward Regions
A familiar type of problem areas is that of the backward regions poised on the threshold of
development. Much effort has gone into defining the conditions necessary for a successful
surmounting of the threshold, the so-called "takeoff in to self-sustaining growth" process.
Employment opportunities haven‘t developed (in amount, in variety, or in both) fast enough to keep
pace with the size and aptitudes of the labor force and resources are underutilized.
Almost all countries in the third world have many backward regions with the above features. For
instance, in Ethiopia the newly emerging regions of Benshangul-gumuz, Afar, Gambella and
Somali fall within this category. Most of the advanced countries have one or more backward
regions, which seem to be fall up at a threshold on the road of development and not to have kept
pace with the structural changes and the rising income and opportunity levels of the more fortunate
regions of the country. However, the term, backward region is relative and the features of such
regions many not be similar in different countries.
2.3.2 Developed Regions in Recession

A second and quite different type of problem area is the mature industrialized urban region afflicted
by development stagnation. The characteristics of this particular region are easily recognizable. The
ailing region‘s rate of growth has been increasingly subnormal for many decades. Unemployment is
high and chronic and out-migration is heavy. The area appears to have somehow lost the dynamic
growth character that had brought it to its peak importance in days gone by. There is a feeling that
unless something really decisive happens, stagnation will prevail indefinitely.
It is believed that in most cases such a situation can arise in a region whose economy is heavily
based on a few activities that have ceased to grow or have begun to decline. They are the activities
of yesterday & today but not those of tomorrow. But arrested growth in a region may also mean
simply that the factors of interregional competition, in specific activities, have taken a trend adverse
to that particular region. The region‘s difficulties are compounded if both of the above conditions
apply, so that it finds itself with shrinking shares of declining activities.
After all, we could hardly expect that every activity would continue to grow forever, or that any
given region could forever retain or increase its relative position in its principal activities. A healthy
regional economy can absorb losses in its stride and shift its resources into new fields, getting a
share of the emerging new rapid-growth activities to balance the inevitable decline of other
activities. The region has to develop its ability to make such adjustment successfully to changing
conditions. Thus, it is important to keep this in mind, in making national and regional development
policies.
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2.3.3 Excessive Growth and Concentration
This type of regions undergoes extremely rapid growth involving massive inward migration. The
growing pains of such regions are felt as impairment of the quality of services, destruction of local
resources and amenities through overuse, a high rate of obsolescence of facilities, neighborhoods,
and institutions and a general deterioration of the quality of life. The forestalling or mitigation of
these effects through analytical foresight and advance planning poses a major challenge to regional
specialists.
The problem of excessive spatial concentration of development, specifically in gigantic

metropolitan centers is related to but distinct from the question of too rapid growth. Concern on this
score is felt in nearly every country. In the less developed countries, the problem is seen as
exclusive concentration of modern industrial development, business and population in the chief
city. Large cities have been variously assailed as hotbeds of vice, breeders of psychological and
political disorder and hazards to health and safety; and they have been extolled for equally diverse
virtues. With respect to economic criteria, it is often argued that the rising costs of housing, public
services and similar items make large cities uneconomical as places to produce or to live. These
diseconomies of size are said to outweigh, in very large cities, the positive advantages of urban
agglomeration. Many regional economists‘ forwards a public policy of diverting growth from such
cities to medium-sized one are very important to relax the problems in such regions.
2.4 The Available Tools
It has to be noted that, any actions to improve the situations of problem regions, needs a critically
understanding of the natures of their problems and their solutions should also take in to account the
variations in the nature of the problem regions. Moreover, it needs the effective cooperation of
different stakeholders. It is generally believed that a region can influence its structure and
development from within. However, a national government can assist a healthy regional adjustment
and development in many different ways. There are some means that can be used to improve the
conditions of problem regions.
In general, such assistance involves the provision of information and the improvement of the
quality and mobility of productive resources including labor, capital and land; aid to education and
vocational training, improvement of communications and financial markets, preparation and
distribution of statistical and technical information, improved labor market information and
placement services and a wide variety of other programs help to reduce the structural
underutilization of labor and other resources in all regions. Moreover, maintenance of a high
national level of demand makes it easier for labor & capital to find their most productive uses.
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Nowadays, many national governments take the important additional step of designating certain
regions for special attention. In a few special cases, the purpose is to restrict further growth and
development in an area judged to be overcrowded (excessive growth and concentration regions).
Much more often, the immediate purpose is to increase employment and income in a backward or
otherwise "distressed" area.
Further line of action involves easing the supply of capital to encourage growth of employment in
problem regions. Accordingly, investment funds are made available at low interest rates, generally
on a matching basis, to establish or expand business facilities in problem areas. A wide variety of
tax exemptions and incentives (such as deferment of taxes, allowance of larger write-offs against
income before taxation, and special low assessments on real property taxes) further encourage
private investors. Public authorities (often working through local development associations) also
encourage business expansion in certain areas by direct investment involving the purchase and
assembly of land, clearing of sites, and construction and operation of "industrial parks" provided
with all the necessary utilities and sometimes with buildings that can be adapted or leased by
private firms.
In the contrasting case of areas in which development is to be restrained, public policy is

implemented by imposing restrictions on further private investment or land use. Another policy
option involves transport costs and services and the construction or licensing of new routes. In
regulatory decisions on freight rates, the regional effects are given some weight and the regions that
stand to gain or lose by the decision often mobilize impressive and costly efforts to protect their
interests. More recently, many cities along inland waterways have been involved in efforts to attract
federal assistance for the rebuilding and upgrading of locks and dams. They have also fought hard
to promote the continuation of pricing policies that shift the maintenance costs of these facilities to
the general public by avoiding the imposition of user charges.
Another tool is the regional allocation of procurement contracts. The procurement agencies
themselves are not particularly interested in conferring regional stimuli; but they have been adjured
to follow policies of greater decentralization, or of preference to areas of high unemployment. A
region especially can sometimes effectively increase the demand for some of its products by sales
promotion in outside markets or protective measures designed to restrict imports, and some states
have been quite ingenious in setting up interstate trade barriers for certain commodities.
A region can sometimes be effectively aided in development by subsidized technological progress

or technical assistance leading to more efficient and profitable ways of using some special regional
resource. Thus, national government supported research, on new uses for regions resources, may
play a significant part in improving the economic status of backward regions. In such types of
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research and development efforts, the state governments, universities, and private foundations in
the region are generally active as well.
A region‘s development can also be guided along more effective lines through support of general
analysis of the region‘s economic situations and potentialities and through the formulation of
integrated development plans. Modest but significant amounts of federal funds and technical
assistance have been made available for planning activity and demonstration projects. Allocation of
funds to improve local public services and utilities has been a substantial element in regional
assistance, particularly in backward regions. This includes, in addition to schools, health services,
and roads, the construction of water supply and sewerage facilities, libraries and some kinds of
recreation facilities. Moreover, programs to upgrade and mobilize human resources through
education, vocational training and retraining, easing of ethnic discrimination and other kinds of
restrictions on employment and assistance in job finding and relocation in search of employment
opportunity are very important to improve the situations in problem regions. Obviously, the need
for such programs is greater in regions where skills and mobility are particularly restricted and
where there is a particularly poor match between labor supply and the demand.
Section Two: Regional Development Strategies
This section, in general, focuses on discussing regional development strategies. Here, the general
concepts of strategy, basic issues of regional development strategy and the various strategies
existing to influence regional development strategies in the desired direction are the major points of
discussion.
2.1 Basic Issues of Regional Development Strategy
There are four basic issues raised in connection with public policy and strategy towards regions.
These are: degree of reliance on place prosperity versus people prosperity criterion; distress
versus development potential: allocation of regional assistance as charity or as investment,
focusing of assistance in growth centers as contrasted with wide dispersion and issue concerns the
appropriate choice of means of assistance from among the large variety of available devices for
influencing regional development.
2.1.1 Place Prosperity versus People Prosperity

If manpower is scarce in some areas/regions while jobs of similar types are scarce in other areas,
the situation can presumably be improved either by moving some jobs or moving some people or
both. Both kinds of adjustment do take place spontaneously, though not by any means to the extent
that would be necessary to eliminate or equalize regional structural unemployment. Both can be
assisted or impeded to some extent by public policies. The question of which policy should be
emphasized is a persistent one and was debated with particular heat several decades ago. It is a
crucial question today in every country that is seeking to improve regional adjustment (particularly
in certain depressed industrial areas).
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The answer depends on our judgments about the foot looseness of people on the one hand and that
of investment and employment opportunity on the other. If we believe that people are reluctant to
move, that we should not try to induce them to do so, and that practically any populated area can be
made attractive to new employers, then it follows that the proper strategy is to induce more
employers (investment and employment opportunity) to move to regions where unemployment is
high.
2.1.2 Degree of Distress versus Development Potential
Consistent with the above view is an emphasis on degree of distress as the criterion for allocation
of assistance to regions, since it is assumed that people have to be helped in situ and that every
region has adequate development potential. By this approach, place prosperity is equivalent to
people prosperity. This view would imply that assistance should be given to individual small areas
and should be widely diffused, since people are assumed to be tied to their labor market areas. To
sum up, place prosperity propose the allocation of assistance on the basis of need to a large number
of quite small areas and inducements to employers as the principal means of assistance other than
straight charity.
People can reasonably be induced to move and that some backward regions lack the potential for
eventually self-sustaining growth in employment or that some developed but distressed regions
must inevitably shrink in size in order to adjust to new economic conditions. This strategy
implication is the people prosperity. We conclude that many of the unemployed people will best
be served by moving to some area with better opportunities and we draw a sharp distinction
between their welfare people prosperity and place prosperity.
In this case, assistance logically takes the form of improving the employability and mobility of the
people affected, facilitating their relocation and promoting employment opportunities in the areas
of greatest potential. Thus, the elements of this position are people prosperity, stimulation of
development on the basis of growth potential and stress on the upgrading of human resources. Job
creation does not have to be stimulated on a diffused basis in a large number of individual areas,
since people are prepared to move to one of a smaller number of growth centers. Dear learner,
clearly, neither is wholly right or wrong, since both people and employment activities are partially
footloose.
In general, the points raised so far suggest the following conclusions. Firstly, migration can and
should play a substantial role in effecting desirable regional adjustments. Its effectiveness tends to
grow and can be greatly enhanced by programs of education, training, retraining, equal opportunity,
open entry, job information and placement services especially directed at the least employable and
least mobile manpower groups in areas of labor surplus. However, as out-migration is highly
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selective in favor of the better trained and more educated people, we cannot presently count on
migration alone to solve all the problems of distressed areas by draining away their unemployed
human power. Such migration from distressed areas may results in a lower "quality mix" of the
labor supply of those areas, which may further handicap them in any competition for new
employers.
Secondly, the mobility of employment locations is the other important strategy relating to the issue
of bringing jobs to people. However, employment is not fully footloose. There are important
differences in the development possibilities/potential of different areas. It would not be feasible to
bring employment to each and every labor market area. Thirdly, place prosperity is an inadequate
and misleading strategy because development assistance should be allocated on the basis of the
needs of people and the development potential of areas. Such assistance should be at least to some
extent, focused on particularly promising locations and human resources programs of the type
outlined above. In any event, there seems to be ample evidence that an attempt to solve problems of
regional unemployment by bringing investment and job opportunities to every community or labor
market area would be wasteful and ineffective. Fourthly, strong political pressure is to be expected
in the direction of the use of local distress as a priority guide, the discouragement of emigration,
and the diffusion of assistance to more and more areas.
2.1.3 Focusing of Assistance in Growth Centers as Contrasted with Wide Dispersion

One of the four basic issues of regional development strategy concerns the focusing of assistance
upon a relatively small number of selected growth centers, at which there exist or can easily be
created the necessary conditions for expanding employment opportunity and the public
infrastructure and the external economies that most activities require or distributing assistance in all
areas. Such growth centers are then expected to attract commuters and migrants from surrounding
areas of labor surplus, and at the same time to stimulate secondary growth of employment in some
of those areas.
The two types of areas do share certain symptoms of maladjustment. Both suffer essentially from
obsolescence of the bases for their former economic viability; both need help in making a structural
shift to a new base in response to changes that have occurred in demand, resources availability and
competition from other areas. For both, a successful transition calls for modernizing human &
capital resources and infrastructure (including institutions and attitudes) so that they can effectively
grasp new opportunities provided by technological and economic change and thus become more
resilient, self-reliant and generative.
With respect to needs for education, the two kinds of areas are likely to differ substantially. The
population of a distressed developed area may show no particular deficiencies in all-round literacy
and capability for productive industrial or tertiary employment. Internal and external transport and
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communication facilities in such an area are also likely to be adequate or more than adequate.
There are substantial local resources of capital and at least some relevant industrial know-how. The
basic elements of growth centers are already there and the problem is essentially one of
modernization—reorienting the local labor force, business community, infrastructure, and public
sector toward the opportunities of today and tomorrow. By contrast, for truly backward areas with
little industrialization or urbanization, the necessity of finding or creating specific growth centers is
of major concern of development paths.
2.2 Types of Regional Development Strategies
2.2.1 Employment Generation Strategy
A substantial number of cases of fairly severe unemployment do occur from time to time in
basically flourishing labor markets. Often these are transitory situations and in some cases the
unemployment is mainly seasonal; but it may be more chronic in areas that attract large numbers of
migrants by their amenities.
Employment generation strategy involves solving the disparities in the employability of different
groups in the labor force and the kinds of labor that are in demand and those that are available and
improving labour mobility and interchangeability within the labour force. Therefore, Public
programs to upgrade and mobilize human resources through education, vocational training and
retraining, direct aids to spatial and occupational mobility: for example, improved information
about job opportunities, assistance to migrants, and removal of racial and other discrimination in
employment and other kinds of restrictions on employment and assistance in job finding and
relocation in search of employment opportunity are very important to improve the situations. Such
efforts ought to focus on upgrading the least advantaged types of workers and reducing their
competitive handicaps. It is quite possible and certainly more appropriate to upgrade the less
productive and less mobile groups so that they will be better able to migrate and also will be more
attractive to potential employers wherever they are.
One of the great virtues of a strategy of human resources development, improved job information,
and placement services is this double-action impact. It helps people move to jobs and helps jobs
move to people. The long-term prospects seem good for some continued increase in the mobility of
the disadvantaged groups in labor surplus areas. Obviously, the need for such programs is greater in
regions where skills and mobility are particularly restricted and where there is a particularly poor
match between labor supply and the demand for labor.
Another line of action involves easing the supply of capital to encourage growth of employment
opportunities. Accordingly, investment funds are made available at low interest rates, generally on
a matching basis, to establish or expand business facilities in problem areas. A wide variety of tax
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exemptions and incentives (such as deferment of taxes, allowance of larger write-offs against
income before taxation and special low assessments on real property taxes) and provisions of basic
infrastructures further attract private investors which in turn expanded employment opportunities.
2.2.2 Human Capital and Entrepreneurship Development Strategies

Human capital is one of the most important factors in the process of economic development. It is a
broad concept which identifies human characteristics which can be acquired and which increase
income. It is commonly taken to mean peoples‘ knowledge and skills, acquired partly through
education and also include their strength and vitality, which are dependent on their health and
nutrition. Human physical and mental capabilities are partly acquired and partly inherited and it
varies from individual to individual.
Theodore (1964) considered human capital as important determinant factor of economic

development. Economic development, particularly the service sector requires skilled, experienced
and innovative human resources for their success. Human capital contributes directly to economic
development through its positive effects on productivity and through reduction in resistance to the
diffusion and use of new technology in the economy. An improvement in the quality of human
labour is as essential as investment in physical capital. An advanced in knowledge and the diffusion
of new ideas and objectives are necessary to remove economic backwardness and instill the human
abilities and motivations that are more favorable to economic achievement.
Most economists now agree that, it is the human resources of the nations, not its other capital or
material resources that ultimately determine the character and pace of its economic and social
development. Human resources development through nutrition, improvement in health care,
provision of appropriate education and training, and empowerment deserves the highest priority
which also true under Ethiopian conditions. What is need for developing countries like Ethiopia
with very large size of population and considerable natural resources is a long term policy for
development of human resources through education, training, health care and empowerment &
creation of a congenital socioeconomic, institutional & political environment for the fullest
utilization of the vast, untapped reservoirs of human power and ingenuity.
In many developing countries the characteristics of economic backwardness is still manifest in

several particular forms; law labour efficiency, factor immobility, and limited specialization in
occupations, a deficient supply of entrepreneurship and customary values and traditional social
institutions that minimize the incentive for economic change. The slow growth in knowledge is
especially severing restraint to economic progress.
The principal institutional mechanism to develop human skills and knowledge is the formal
education systems. Formal education impart knowledge and skills to individuals to enable them to
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function as economic change agents in their societies and it also imparts values, ideas, attitudes,
and aspirations that may or may not be in the nation‘s best development interest. Schultz identified
the following important activities that improve human capabilities:
 Provisions of health facilities and services broadly conceived to include all expenditures that
affect the life expectancy, strength & stamina, & the vigour and vitality of the people;
 Provisions of on the job training organized by firms and other organizations;
 Formally organized education at the elementary, secondary and higher education‘s;
 Study programs for adults that are not organized by firms including extension program
notably in agriculture and other business and
 Migration of individuals and families to adjust to changing job opportunities.
In general, human resources constitute the ultimate basis for wealth of regions. Capital and natural
resources are passive factors of production unlike human beings who are the active agents who
accumulate capital, exploit natural resources, build social and economic infrastructures and carry
forward the regional development. Harbison (1973) and Todaro (1992) clearly stated that a
country which is unable to develop the skills and knowledge of its people and utilize them
effectively in the national economy will developed anything else. The slow growth in knowledge
is especially severing restraint to region‘s economic progress.
The ability of a region to initiate and sustain long-term economic growth is dependent on the ability
to apply innovative idea to solve practical social and technical problems; managerial and technical
skills of its people and its access to critical markets and product information at low cost. Human
capital and entrepreneurship nurturing strategies involves actions to improve human ability to apply
innovative idea to solve practical social, economic and technical problems. It involves enhancing
knowledge about marketing, distribution, inventory control, and transaction processing and worker
motivation. Romer conclude that the gap in the ability to apply innovative idea to solve practical
social, economic and technical problems are critical to determine the pace regional growth and
development.
Unit Five
Local Economic Development

This unit deals with the issues of local development. Local economic development (LED) is
defined as a process in which partnerships between local governments, community-based groups
and the private sector are established to manage existing resources to create jobs and stimulate the
economy of a well-defined area. It emphasizes local control, using the potentials of human,
institutional and physical and area natural resources. Local economic development initiatives
mobilize actors, organizations and resources; develop new institutions and local systems through
dialogue and strategic actions.
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Section One: Dynamics Changes in Approaches to Local Development
This section elaborates the changing approaches in the context of local development and also
outlines the major aspects of change. Up till the mid-eighties, the economic development of
particular localities and regions critically depended on central movement interventions. Many of
these interventions were implicit and discrete rather than based on an explicit policy of local area
development. Policies of regional development served only as indicative guidelines for the spatial
allocation of public investment. The dominance of central government in all spheres of economic
life contributed to the underdevelopment of the local social and economic fabric.
However, the context of local economic development has dramatically changed since the 1980s in
low-income countries. This is result from sets of forces of change like emergence of structural
adjustment and liberalization policies and disenchantment with the state and state-led development;
space reducing technologies in transport and communication; the technological and managerial
changes in production of goods and services and the growing volume of people, capital and firms
that are mobile across (parts of) the globe. All these forces of change resulted in the emergence of a
new generation of local economic development which we will discuss in the next two sections.
1.1 Trends in Local Economic Development
Up till the mid-eighties, local development conditions were largely shaped by central government
agencies. The lives of peasant farmers depended on parastatal agencies that provided or were
supposed to provide key inputs such as seeds, fertilizers and extension. Government determined
prices of crops and bought up cash crops through marketing boards where as little was left to the
market and to individual peasant decision-making. In urban areas, small enterprises, also named as
‗informal sector‘ continued to be partially repressed by the state and were rather inadequately
served by central government. The small and micro enterprises served primarily local markets and
faced intense competition. As many people moved into self-employment, more SME became
survival based, sharing poverty rather than generating economic growth.
Economic development outside agriculture and outside the indigenous small and micro enterprise
sector was largely a matter of central government parastatal enterprises and mostly foreign
investors or transnational corporations. These enterprises were generally large and vertically
integrated. They internalized the production of inputs and of allied services and thereby they
minimized their demand for inputs and services from other local producers. Foreign exchange to
buy essential raw materials and inputs was scarce and heavily rationed. There was little competition
in these product markets.
Basic services were provided free of charge by public sector agencies. In a number of countries,
pre-existing private and NGO initiatives had been curtailed in the wake of independence. Official
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Development Assistance (grants and soft loans) funds became increasingly important to finance
and organize the investments in basic services and physical infrastructure. Infrastructural
investment depended on ad-hoc central government decision-making and on the availability of
project based donor finance.
In general, under the above situation, the economic development of particular localities and regions
critically depended on central movement interventions. Many of these interventions were implicit
and discrete rather than based on an explicit policy of local area development. Government
decisions on large-scale industrial investments were also largely discretionary and ad-hoc. Policies
of regional development served only as indicative guidelines for the spatial allocation of public
investment. The dominance of central government in all spheres of economic life contributed to the
underdevelopment of the local social and economic fabric. Internal dependency on central
government increased and central government bureaucracies became the‘ glue‘ that held it all
together. However, the quality of the ‗glue‘ declined over time for a number of reasons.
1.1.1 Changing Aspects in Local Development
The context of local economic development has dramatically changed since the 1980s in low-
income countries. In this regard two sets of forces of change, each being composed of a bundle of
issues, can be distinguished. The first set refers to fundamental changes in development policy. In
relation to development policy, three factors standout. These are structural adjustment and
liberalization policies; disenchantment with the state and state-led development.
Structural adjustment and market liberalization (which actually means ‗liberating‘ markets from
public intervention) changed this general local economic context. Central government ceased to be
the main organizing agency. The business environment changed from being heavily regulated by
central government and run by public institutions to one in which there is very little regulation but
where market supporting institutions were lacking.
Following this, many countries have experienced serious economic downturns, often associated
with structural adjustment and sometimes with political instability. Few have been able to restore
economic growth. The overall climate for local economic development has been negative.
Secondly, central governments have lost their central economic coordinating role; other actors have
to come in to make the market economy work. Investments & improvements plans of local
producers critically depend on complementary investments by other producers and other economic
agents (traders, banks) as well as government. This interdependence may produce a deadlock.
Local economic development can contribute to reduce such deadlock.
After structural adjustment, central governments paid even less attention to equalization of
conditions across regions and localities. Socio-economic gaps between localities and regions are
likely to have been rising. Simplifying, one can distinguish three types of situations 1) cities and
regions which are integrating in the new geo-economy; (2) localities and regions which have the
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resources and potential to integrate and (3) localities and regions which are or have been unable to
link up. The latter category would include, amongst others, regions with a predominantly
subsistence economy.
Localities are increasingly thrown onto themselves to create ‗place prosperity‘, to create the right
conditions for the economic advancement of its population. That is those entrepreneurs can seize
business opportunities that households can improve their livelihood and that workers can find jobs
that match their capacities. Local governments have an important role to play in creating place
prosperity. However, local governments must realize that they are not in the driving seat when it
comes to local economic development. Much depends on private enterprise & their associations,
CBOs unions & support agencies including NGOs) & on convergence on the direction of local
economic development. Lastly, the new generations of local development initiatives brought a
about new roles for the public sector. This applies both to central government & to local
governments. Local government is to provide the right mix of local public goods and secondly to
facilitate or enable other actors, communities, private firms, workers and NGOs to make their most
productive contribution. There is growing recognition in this connection that the public sector can
be a source of private sector and of community economic growth.
The second set of changes in the context of local development refers to what Dicken (1998) called
the new ‗geo-economy‖. This consist of three factors, namely (a) space reducing technologies in
transport & communication; (b) the technological and managerial changes in production of goods
and services and, (c) the growing volume of people, capital and firms that are mobile across (parts
of) the globe. The new ‗geo-economy‘ context creates winners and losers. Some localities are able
to export goods and services to larger domestic and to international markets and to attract external
firms, capital and expertise to enable them to grow further, others are unable to benefit from the
opportunities offered by new geo-economy and are losing their own local resources (capital, firms
and educated people) that look for ‗greener pastures‘ elsewhere.
Finally, globalization exemplifies the growing mobility of firms, capital and people. There is ample
evidence that the flow of foreign direct investment has grown substantially over the last decades.
Mobility has increased and so has competition to attract firms, capital and people especially
professionals. The competition increased due to two factors. One is that firms, capital and people
have more alternative opportunities. They are better informed and can more easily switch to
alternative places. Secondly, territories (countries and municipalities) increasingly compete with
each other to attract these in order to create local employment & income. Territories intensify their
efforts to attract foreign investment, capital and people. Here, competition intensified because
getting a small share of a large volume of international mobile investment may make a big
contribution to local employment and income. Moreover, selective attraction of inward investment
may assist in bridging the local-global gap and may help to resolve crucial bottlenecks in the local
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production system and improve access to new external markets. All these changes resulted in the
emergence of new generations of local economic development initiatives.
The principal characteristics of a new generation of local economic development promotion as

follows. First, it is multi-actor. Its success depends on its ability to mobilize public, private and
non-profit actors; second, it is multi-sector. It refers to public, private and community sectors of the
economy; third, it is multi-level. Globalization, both as a competitive threat and as a resource
opportunity, forces local initiatives to be framed by an analysis of global changes. Local economic
development is increasingly ‗think globally and act locally‘.
Section 2: New Generations of Local Economic Development Initiatives
Local economic development (LED) is defined as a process in which partnerships between local
governments, community-based groups and the private sector are established to manage existing
resources to create jobs and stimulate the economy of a well-defined area. It emphasizes local
control, using the potentials of human, institutional and physical and area natural resources. Local
economic development initiatives mobilize actors, organizations and resources; develop new
institutions and local systems through dialogue and strategic actions.
In this section we will carefully examine three main categories of local economic development
initiatives. The first set refers to actions that may be broadly described as community based
economic development. Community based economic development may be applied to both rural and
urban settings, though a number of characteristics would necessarily change. The second category
refers to business or enterprise development. This broad category consists of initiatives that directly
target and involve (cluster of) enterprises. The third category refers to locality development. This
refers to overall planning & management of economic and physical development of the area.
2.1 Community Based Economic Development
In the past decades, communities in many poor rural areas and urban slum settlements have
experienced many problems or challenges. These include: I) feminization of poverty; ii) poor
settlement conditions which in urban areas generally imply overcrowded settlement; iii) housing
conditions that are deficient and in urban areas often not very suitable for income generating
activities; iv) lack of access to basic services, and v) insecurity of income and work as well as
serious physical insecurity.
Poor settlement and housing conditions have also negative economic consequences. They often
create additional costs and introduce greater risks. Physical insecurity & health risks (inundation of
settlement, disease, theft and violence) reduce productivity. Economic activities have to be
interrupted frequently and assets and stocks may be lost or damaged. The lack of access to basic
services (water, sanitation and energy) and taking recourse to informal sector solutions to these
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problems raises costs. Production and transaction costs increase. In many respects these activities
suffer from diseconomies of micro scale. There are immense obstacles. One is institutional
insecurity, in respect to land and natural resources and in economic transactions and in relation to
economic and environmental legislation.
The other constraint is lack of appropriate planning. Planners have often ignored the economic
function of settlements as if only residential use mattered. New approaches are needed that
recognize that self-employment and household-based economic activity is the predominant form of
livelihood rather than wage employment in distant industrial areas. Community economic
development will inevitably suffer from resource inadequacy. There are always more needs than
resources. This implies however also that every investment made should bring the highest possible
level of local impact. Finally, community based economic development rarely enjoyed substantial
political attention. Thus, local development initiatives would have to take the interdependencies of
these issues into account. At present, the democratic decentralization offers new political
opportunities that also can be exploited for economic development of local communities. With
political decentralization, local governments take great responsibility for community development.
Community based economic development has a number of broad aims. First, it is intended to
stimulate a sense of community. Secondly, to promote self-help & community empowerment, third
to contribute to the generation of (self-) employment opportunities. Fourth, to improve living and
working conditions of community and to create public and community services for the local
community.
2.1.1 Components of Community Economic Programmers
It is almost impossible to generalize about development policy prescriptions and to formulate

universally applicable community development programmers. What follows below is not more than
a general repertoire of practices and experiences which have demonstrated to have relevance in
terms of community based economic development. By the same token it is not pretended to be a
complete nor exhaustive listing. Below we will concentrate on the following components.
I. Creating Local Safety Nets
One of the key features of poverty is the inability to withstand economic shocks of any kind.
Creating local safety nets and reducing insecurity is fundamental for creating better conditions for
local economic development. Day care centers run by women groups can be the basis of local
mutual support networks at neighborhood level. Financial safety nets can be created through the
formation of savings and credit groups to meet income emergencies. Physical security is often a
very serious economic problem. Village & neighborhood watch committees organized by
communities can have some impact especially in relation to theft, but their effectiveness depends
on backup and support from formal law enforcement.
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II. Housing Improvement and Settlement Upgrading
Community settlement upgrading usually involves a package of activities. One is improving the
design of the settlement by creating space for basic services, such as water, sanitation, roads,
community facilities for health and education as well as to improve homesteads and housing
quality. It has been increasingly realized that settlement upgrading should allow for home based
economic activities and incorporate provisions of small enterprise plots while commercial
redevelopment of central locations of the settlement may complement the whole.
III. Basic Service Delivery
The restructuring of the delivery of basic services has been set in motion in the nineteen nineties
and that is likely to be extended well into the next century. A pragmatic approach would be needed
that takes into account the ‗unbundling‘ of service delivery within specific sectors. Unbundling can
help to determine which components in the service delivery process can be privatized (either
commercially or on a non-profit basis), which can be brought into the realm of community
enterprise & which continue to require public sector direct responsibility.
IV. Stimulating Community Economy
Households act in the local economy in three ways: as consumers, as micro-entrepreneurs and as
workers. They act individually and as organized (functional) groups that have a community of
interest, for example as a consumer cooperative, user associations of basic services, workers unions
and producer associations. It should be noted that poor people are weak market parties. Their very
limited and insecure resource base (e.g. because of a poor capital asset base or because of limited
technical/ functional skills) cause low productivity. This, in turn, often in combination with intense
competition (because of large numbers of poor people in similar positions) yields very low incomes
and makes poor people vulnerable to unequal market exchange.
Policies that aim to increase the reliance on markets to allocate resources and to provide goods and
services therefore may put poor people at more and greater risks. Market regulatory policies should
therefore also ‗level the playing field‘ for the poor and their enterprises, i.e. reduce barriers arising
from informality. Micro-enterprise programmers would constitute the core of community economic
development. Such programmers could consist of three or more components-credit, training and
technical assistance and marketing. A special category of training concerns training of MSE‘s as
contractors of basic public services. As local movements also increasingly move towards out
contracting of public services, there is also scope for out contracting to MSE‘s and community
enterprises. In the labor market some measure of success can be achieved in improving the
employability, for example via training and skills programmes associated for example with
construction in settlement upgrading and with the delivery of basic services.
2.2 Enterprise and Business Development

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One of the central guiding ideas of LED is its concern for the development of the local economic
base of an area. The local economic base refers to the activities that involve exporting their product
and services to outside the area concerned. It is often also called the export base of an area, district
or town. The destination of these exports is for all practical purpose anywhere, in other parts of the
same country or abroad. The economic base of a district may consist of one or several agricultural
products, or of manufacturing or service activities (trading or tourism). Other local economic
activity mainly supplies the local market and hence depends for its demand ultimately on the
growth of the local export base.
The export or economic base normally consists of one or more geographical concentrations
(Clusters) of local producers. Firms and clusters may grow and specialize in their activity. This
specialization itself is an important growth mechanism. Due to specialization, local producers may
achieve internal economies of scale, which in their turn may generate increasing returns. That is as
volume of production increases the unit costs decline and hence, enhancing the competitive
position of these producers. Clustering and specialization may contribute to the emergence of
agglomeration economies. These are advantages that accrue to local producers and that arise from
the geographical concentration of particular activities. In theory the major agglomeration
economies are a pool of (specialized) labor, availability of specialized inputs and knowledge spill-
over.
Once a cluster has come into existence a new phase of local economic development may set in,
namely that of ‗active collective efficiency‘. The active collective efficiency has three components.
First, local producers, especially when they are of a medium or small size, may find it
advantageous to specialize amongst themselves. The second component is the creation of private
regulatory and support institutions by joint action among local producers. Local producers, if
clustered, are likely to develop their own local production practices, norms and standards. The
creation of a local producer or business association is often indicative of such a potential for
‗private governance‘. The third component refers to local collective action of local producers
towards both central and local government to lobby for public support insertions and infrastructure
like the area of vocational training, technology development or a local transport terminal. An area
that has developed these three types of ‗active local efficiency‘ in its economic base would enhance
its cumulative advantage as compared to producers in other areas who are dispersed & who lack the
development of local institutions and joint action.
Moreover, by being part of agglomeration, local producers can greatly expand their learning
capacity. Learning takes place via supply chain linkages (i.e. supplier and customer relations), via
mobility of skilled labor between the firms and via spin-off activity (creation of new start-ups). It
also may involve imitation and reverse engineering; informal knowledge exchange and specialist
services. In short, an agglomeration facilitates group based and collective learning.
2.1. Components of Enterprise and Business Development

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The core of a local economic development programme would be the expansion, re-structuring or
creation of the economic base of the area .The economic base may consist of one single or various
concentrations or clusters of local producers in particular industries. Initiatives to be developed by
local producers can develop in two directions. First, strengthening the cluster formation process
along the lines depicted above. They may give rise to the creation of enterprises and employment in
allied services; second, advancing the local participation in the corresponding commodity chains,
either by new investment of existing local firms or by selective attraction of external firms, or a
combination of both.
An important issue in local enterprise and business development is the target group. One can
distinguish at least four distinct ones. I) Attracting firms from elsewhere (e.g. foreign direct
investment, multinational corporations; ii) formation of new firms; iii) expanding existing firms;
and iv) Innovation and graduation of MSE. Each target group would have its own approach and
specific requirements.
Many local governments are nowadays offering local financial incentives. Financial incentives seek
to compensate for locational disadvantage but real services support to local enterprise may help to
create competitive disadvantages. For local producers to gain access to more remunerative external
markets, they generally require specialist business development services (BDS) to enable them to
acquire knowledge about these markets. They also need these services in order to prepare their own
manufacturing operations financially, technologically & organizationally for internationally
competitive production. Large firms may be able to marshal the resources to engage in required
market development and associated product development efforts. Small and medium enterprises,
however, often have to gain access to external resources and rely on specialist business service
providers to obtain market and product information, tools and technologies, skills etc.
There is a great range (types) of special programmes required to promote enterprise & business
development. They seek different levels of achievement in relation to agglomeration. The first type
of programmes basically seeks to generate passive‘ agglomeration economies‘. A growth point or
growth centre would be a good example. Government concentrates public infrastructure investment
in particular places, possibly in combination with other incentives to attract new firms into an area.
Geographical concentration may generate specialization.
A second type of programme goes further and seeks to promote the formation of clusters of
enterprises. These progenies assume that geographical concentrations of local producers are already
in existence and that through joint action by local producers a new range of advantages can be
created, strengthening the competitiveness of a cluster as a whole. Business support services and
inter-firm cooperation are principal an avenues of action. A third avenue of action is to focus on
group learning for local producers to acquire new competencies. The rapid introduction of new
agro-exports (vegetables. fruits and flowers in Guatemala, Chile and Kenya, respectively) is based
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on the existence of group based learning of the norms and standards for the products and of
associated production practices and techniques, especially quality control.
Often an actor, playing a key role in the governance of the chain and contributes to the spread of
new knowledge to the local producers may include foreign buyers, a local business association or a
local enterprise agency. The most advanced type of programme seeks to generate collective
learning whereby the latter extends itself to the enterprise support network. This is called a local
innovative milieu. There must be a collection of players consisting of firms, research & training
institutes & local authorities, which must have relative decision-making independence & relative
autonomy in making strategic choices.
Local producers have to develop associational capacities, at the level of the firm, at the level of
inter-firm cooperation and the commodity chain and at the level of enterprise support systems. The
main challenge is to get the interaction right between these three elements. The locality or region
can perform strategic enterprise support functions that cannot easily be done centrally. The national
level is too high to cope with complexity and detail, while the local regional level allows for an
appropriate incorporation of local diversity and specificity. Local network must be forged which
facilitate coordination and convergence across these three elements.
Section Three: Locality Development and Actors of LED
Dear learner, in the previous sections, you have studied about the two major categories of local
economic development initiatives. In the first section we have outlined the concepts, aims and the
main components of community economic programmers where as business or enterprise
development is the main themes of discussion in the second section. This broad category consists of
initiatives that directly target and involve cluster of enterprises. In this section you will learn about
the third major categories of the new generations of local development initiatives. That is locality
development which refers to the overall planning and management of economic and physical
development of the area.
In this section we will focus on addressing the concept and goals of Locality development; it‘s the
underlying components like Physical Planning and Development Controls, Urban Planning and
Design; infrastructure and socio-economic overhead capital. This will be followed by a briefly
discussions of the major actors of locality development with great emphasis on local producers &
local government.
3.1 Definitions of Locality Development
Locality development corresponds to the management of the entire local territory. That is, it built
up physical infrastructure and economic and social overhead capital of the locality in such a
manner that it generates the balanced development of all land uses, resolving land use conflicts,
minimizing negative (congestion, pollution) and maximizing positive externalities (agglomeration
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economies) in the locality. It refers to the overall planning and management of economic and
physical development of the area concerned. Locality development is about the planning and
realization of infrastructures and of relevant economic and social overhead capital. Locality
development is not restricted to the export base of an area but also has to address the orderly
development of the non-basic sector of the local economy and that also includes the community
economy.
When a local economy develops a certain export base, this gets reflected in its built up of
infrastructures geared to serve it. For example when an area is specialized in particular agricultural
production or manufacturing sector, specialized physical and socio-economic infrastructure are
needed to serve it. Moreover, technical training centres to form skills in related trades and
occupations where as warehousing facilities and freight infrastructure expands in response to
demand. On the other hand, a tourist destination area is likely to develop different training
institutions offering different skills and passenger rather than freight transport infrastructure
facilities. Part of this infrastructure is public sector and timely planning and development of these
infrastructures will stimulate complementary private infrastructure services. Together they enable a
locality to improve the basic conditions for the economic activities to stay competitive and expand.
In general, localities that succeed in better management of their territories contribute to enhance the
competitiveness of their economic activities and it may also improve the local quality of life.
Together these may make the locality more attractive to external investment, firms and people.
Dear learner having the conceptual foundation as a backdrop, let us further broadens our discussion
by considering the major components of locality development.
3.2 Components of Locality Development
As locality development is the management of a territory, it involves several components and

stakeholders. The most important components of locality development is participatory local
economic development planning. Since it is a multi-actor affair, rarely one single stakeholder holds
all the stakes and has all the resources to achieve LED goals. There are important investment
complementarities within the private and community sectors and between the public and private
agents, which when properly managed, can result in important economic gains and external
benefits that otherwise would not be forthcoming.
Local government can make an important contribution by properly coordinating its own public
sector investment programme with needs and investment priorities of communities and the private
firms and through its physical planning. Local convergence among actors is central to local
economic development initiatives. This needs exchange of information and procedures for
decision-making. The participatory formulation of a local development strategy plays an integrating
role in locality development. It identifies the overall local development priorities, defines a set
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strategic issues and related action programmes, both for public & private sectors and in doing so,
provides a basis for coordination of complementary investment programmes.
3.2.1 Physical Planning and Development Controls

Urban land market is rife with all sorts of distortions and requires government regulation. Zoning
and other land and building regulations can be an important tool if it is carried out with flexibility
and with a developmental attitude rather than for the purpose of any rigid master plan control. The
latter implies that the interest of all urban citizens and groups need to be taken into account
including urban agriculture and home based enterprise. Regulations should be simplified,
understood and agreed by all parties. Subsequently local authorities should make these regulations
stick. The lack of transparency often makes this a lucrative area for rent-seeking and corruption.
Different agencies can co-ordinate and simplify their procedures, through which permits and
licenses can be obtained for instance by setting up a ‗one-stop‘ service.
3.2.2 Urban Planning And Design

Economic performance can be improved if commercial centers are upgraded through improvement
of commercial streets and premises, often involving selective conversion of land uses & higher
densities. This includes actions geared towards the improvement of the town or city central areas
and makes them more attractive for residents and prospective investors. The policy requires a
physical planning process supported by a cooperative attitude of both the local authority and the
potential beneficiaries. For instance, local businesses and local community organizations are
coordinate to discuss existing problems and to set in motion actions to implement action plans.
3.2.3 Infrastructure
Land is more attractive to potential users if it has already been developed or it can be provide at
lower costs. Available infrastructure shortens the time between acquisition and operations and
saves them the cost of building the infrastructure themselves. The basic services to be provided are
water and sewer, electricity and street lightning access roads and sidewalks. The supply of
improved sites should take into account the diversified demand for such sites, for instance, taking
into account the demand by micro and small enterprises. Public-private partnerships can increase
the capacity of local governments to provide infrastructure.
3.2.4 Socio-Economic Overhead Capital

One of the important challenges of locality development is the creation and expansion of economic
& social overhead capital. This refers to public, non-profit and private institutions in the areas of
education and training, research and technology, information and communication & social capital
serving the locality as a whole as well as institutions dedicated to its specialized industries. One of
the roles of local movement, together with other private sector and civil actors, is to contribute to
create and/or to attract to the locality (branches of) specialist providers of such overhead capital.
3.3 Actors In Local Economic Development

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The context for local economic development has enormously changed in the last two decades and
so has the thinking about policies. Central governments have considerably reduced their
responsibility for place prosperity. Localities and regions have been thrown onto themselves to take
responsibility for their own development. Mostly by default & occasionally by design, local actors
have been given the frameworks & have themselves developed the full range of processes to do so.
The range of actors of locality development has been identified including governments,
communities & their organizations, non-governmental organizations and now also private
enterprises. The debate on enablement has made clear that governments continue to play a major
role in the development of locality. Communities & their community based organizations continue
to be principal actors in locality development. Here, it is important to make a distinction b/n
grassroots territorial community based organizations (CBO‘s) and ‗Self selected‘ grassroots
groups‘.
The former type is all encompassing & broadly representative & multi-purpose community
organization organizations. Often, such CBO‘s are framed by local tradition and custom and
increasingly also by local or national government legislation whereas a women‘s savings club is an
example of a self selected‘ grassroots group. Such groups are mostly single purpose oriented, more
homogeneous and are less hierarchical and every member participates by virtue of its accepted
membership. In the other hand, territorial CBO‘s have been the main focus of community
development efforts in view of their public character, in the context of markets. Self selected
community groups become more important but in order to strengthen the position of community
groups, the formation of second and third level organization is important. That is associations of
grassroots groups and federations of associations.
The establishment of associations and federations has several important advantages. Firstly,
numbers raise voice as apex organizations can yield a more than proportional influence. Secondly,
associations can facilitate sharing of information and experiences and can contribute to learning.
Thirdly, due to their larger size & scale of operation, associations can undertake functions, which
are not feasible at CBO level. The 2nd and 3rd tier organization can strengthen the autonomy of
CBO‘s vis-à-vis the state as well as the market.
3.3.1 Local Producers and their Association

Local producers are one of the key actors in local enterprise & local business development. Inter-
firm cooperation and joint action plays a central role. However, local producers are very often
individualistic and find it difficult to combine competition with cooperation. Several commentators
have indicated that joint action and inter-firm co-operations, of the kind enumerated above, does
not come easily. Some argue that such collaboration requires a kind of external catalyst or
brokerage role.
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The multiple roles of business associations in economic development are increasingly recognized.
Associations may take a variety of forms. Traditionally, they represent their members in their
dealings with government & lobby for more favorable economic policies. They also often negotiate
with trade unions and provide a reference group for individual entrepreneurs. More recently, the
emphasis shifted to two other functions, the provision of business development services and
‗private interest governance‘. The experiences with new industrial districts provide ample evidence
of services, such as information, training, technology and marketing. Private interest governance
refers to regulatory functions performed by associations, like establishment of norms & standards
products, & codes of conduct. They can also resolve conflicts of interest between their members.
3.3.2 Local Government

Local government plays a more prominent role in local economic development. Several factors
have contributed to a more prominent role for local government in local economic development.
The first is a generalized and persistent trend towards decentralization in the public sector. By now,
the vast majority of developing countries and transitional economies are engaged in processes of
decentralization and strengthening their local governance structures. Central government
responsibilities have been transferred to local governments but very often without adequate transfer
of resources. The need to generate more local revenues has forced the local governments to take
more interest in the economic development of their area of jurisdiction and also to fulfill the
demands of local people and enterprises. Secondly, changing perceptions on poverty alleviation
have made local government more active in pursuing local employment creation. Thirdly, in a
number of countries, national or state governments have launched support programs support
programs to enable local governments to become more active in local economic development.
Last but not least, central government still has an important general influence. Most importantly
through its macro-economic policies, central government defines a macro business environment
that needs to be stable and conductive to private investment. Furthermore, it plays a crucial role in
creating political stability essential for reducing investment risks. National sector ministries &
specialized line agencies provide specialized services and perform regulatory roles in relation to
trade and sector specific issues and regulation.
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COURSE 4: CONFLICT MANAGEMENT AND PEACE BUILDING
Chapter One
General Overview of Conflict
1.1. Introduction
Conflicts are inherent to human behavior and inevitable in the day to day interactions of human societies.
They are neither totally good nor bad; their destructiveness and constructiveness highly depends on the
approaches and mechanisms that peoples try and actually implement and use to resolve these conflicts.
1.2. The Definition of Conflict
 The term conflict has been used to describe a wide range of human activities including hostility
between people to international war. Traditionally, conflicts defined as ―fight, battle or struggle of
principles. But this definition is unsatisfactory because interpersonal disputes are rarely a clash of
principles. A very similar word to conflict is dispute. Dispute is more of a disagreement, opposed
ideas and difference in interests and even in goals between and/or among individuals and groups, and
states. Hence, except some minor differences, we can interchangeably use the two terms i.e. conflict
can be represented by dispute and vice versa. Conflicts have a beginning before violence occurs.
Conflicts can go up/rise into violence or more worsen overtime, and eventually they grow
less/decrease. That‘s why conflicts are mostly manifested and recognized when violence occurs.
 Conflict can broadly defined as an incompatibility of goals or values between two or more
parties in a relationship, combined with attempts to control each other and antagonistic feelings
toward each other. The incompatibility or difference may exist in reality or may only be
perceived by the parties involved. Nonetheless, the opposing actions and the hostile emotions
are very real hallmarks of human conflict. Conflict is a state of opposition between and/or
among individuals and groups to incompatible options, interests and goals over the material and
spiritual life of human beings.
 The most common issues for goal seeking incompatibility/sources of conflict
 Control over resources/human needs- such as space, money property, power, prestige
and like are one group of incompatibility if, however, the parties view them as non
sharable and/or if they seek exclusive control with rigid fixation over the particular
resource and with little desire or possibility to find a satisfactory substitute for it.
 Value difference- as a source of incompatibility revolves around on ‗what should be‘.
This difference can be over isolated and relatively minor issues as between husband and
wife about certain appropriateness of home arrangement etc or it can be over larger forms
of religious or ideological values which are competitive and in opposition to one another
as for example between capitalist vs. socialist way of restructuring state-society relations.
Value differences by themselves do not necessarily cause conflict unless there is a claim
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by one of the parties that one value should dominate or be applied on the other who have
different value.
 Discrepancies over beliefs or over „what is‟- an incompatibility over facts, information
knowledge or their interpretations which are securely held as fundamental and essentially
correct by the person or the group involved. Opposition to these beliefs by another party
equals a challenge to one‘s ability to grasp and understand reality and amounts to
undermining his/her ability to appear and act rationally. Like values, not every
discrepancy in belief system leads to conflict unless one of the parties decides his/her
belief should dominate or be accepted by the other.
 By summarizing the above discussion one can give the operational definition of conflict as: a
social situations in which the ability of one participant to gain his ends is dependent on the choices
or decisions that the other participant will make. Conflicts can also occur when one party is
interfering, disrupting, obstructing, or in some other way making another party‘s actions less
effective.
1.3. The Nature of Conflict

It is a plain fact that conflict is a natural reality and phenomenon which is inherent in human history in
all personal and social relationships. Conflict inevitably exists, and would exist in the future, in every
aspect or dimension of human life in all walks of people‘s life in general and individual in particular. No
one can eliminate or avoid conflict but can minimize the potential inevitability of conflicts. It is not a
realistic or even desirable to avoid or eliminate conflict. Conflict occurs between people in all kinds of
human relationships and in all social settings. Because of the wide range of potential differences among
people, the absence of conflict usually signals the absence of meaningful interaction. Conflict by itself is
neither good nor bad. However, the manner in which conflict is handled determines whether it is
constructive or destructive. When conflicts and violence are managed peacefully, they are productive and
may even become a source of development and prosperity within the participation of parties/groups
involved in a particular issue on particular and on all levels of community. A constructive dealing of
conflicts will bring the society towards the desired development.
1.4. Major Levels of Conflict

Conflict can occur at a number of levels of human functioning. It is ever-present/exists everywhere. One
mechanism to classify conflict is by level, it may occur in our head or at international level. Accordingly
the following five levels are widely acceptable.
 Intra-personal conflict
At this level, conflict occurs within (the mind of) an individual. Sources of conflict can include ideas,
thoughts, emotions, values, predispositions, or drives that are in conflict with each other. We all may
confront with ideas, interests, feelings… totally situations that are not compatible each other and able to
confuse us and engage us in the condition hard to make a right decision. According to Lewicki, Barry,
and Saunders, intrapersonal conflict is also called intra-psychic conflict. It occurs within you. This
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conflict can develop out of your own thoughts, ideas, emotions, values and predispositions. Intrapersonal
conflict occurs when you internally argue with yourself about something, such as when you want to be a:
Musician or Dancer, Christian or Muslim, Teacher or Doctor…..etc.
 Inter-personal conflict
This second major level of conflict, which we will call interpersonal conflict, is between individual
people. A conflict that occurs between a husband and wife, bosses and subordinates,
classmates/roommates is all inter-personal conflict. In interpersonal conflict, you are in conflict with
other individuals. This is considered a major level of conflict and can occur between co-workers,
siblings, spouses, roommates and neighbors etc... E.g. a conflict between: You and your dorm mate,
brother, friend etc...
 Intra-group conflict
This third major level of conflict is a conflict with in small groups among team and committee members
and within families, fraternities, classes, and work groups. Intra-group conflict refers to a specific kind of
conflict that occurs between members of a group that shares common goals, interests or other identifying
characteristics. Intra-group conflict can be small-scale, such as within a workplace or large-scale, such as
between members of a specific population group. Though conflict is generally regarded as a problem,
intra-group conflict as the other levels of conflict can do, also serve as a valuable tool in some contexts.
Intra-group conflict occurs between members of a group or team who are theoretically united over a
common characteristic or objective. An example of intra-group conflict is a conflict between Sub-groups
( ethnic, religious, political…etc.) and Sub-families in a clan…etc.
The two main forms of intra-group conflict are relationship conflict and task conflict. In an intra-group
relationship conflict, members of the group struggle with interpersonal relationships regardless of the
task or objects of the group. For example, two members of a marketing team may experience conflict
because one member applies a diplomatic approach to communication, while another prefer
straightforward and aggressive communication. If a group is experiencing a task conflict, members of the
group disagree about the best practices for achieving an objective or struggle to agree on an appropriate
objective. For instance, a marketing team may struggle because some members support traditional direct
marketing while other members want to experiment with a viral marketing campaign.
 Inter-group conflict/Intra-state conflict

This fourth major level of conflict is a conflict between groups, union and management, warring
notations, feuding families, or communities challenging governmental authorities. At this level, conflict
is quite complicated because of a large number of people involved and the possible interactions between
them. Conflict can occur within groups and between groups simultaneously. Negotiations at this level are
also the most complex.
 Inter-state conflict
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This level includes a conflict arises between and among different sovereign states in the international
arena in the run to protect and promote their national interest. Our world entertains uncountable number
of inter-state conflicts and wars in different periods of history including the two major wars; WWI
&WWII.
 E.g. a conflict between: Ethiopia and Eritrea since 1998 ; South-Korea and North-Korea since
1950- 1953...etc.
1.5. Basic Categories of Conflict
 Conflicts can be categorized by the cause of the conflict. The major categories of conflict are
discussed here under.
 Relationship conflict: This category of conflict is the conflict that emanate from a strong
negative behaviors. Resolving relationship conflict requires the safe and balanced expression of
perspectives and acknowledgement of emotions. This is usually manifested at individual and
group levels.
 Data conflict: This conflict refers to the conflict that emanates from the lack of information
differently or disagrees on the importance of data. These kinds of conflict usually have a data
solution.
 Interest conflict: This category of conflict is the clashes over perceived incompatible needs.
Interest based conflict can resolve around:
 Substantive issues; such as money, physical resources, time...etc.
 Procedural issues; the way the dispute is to be resolved.
 Psychological issues; such as perceptions of trust, fairness, respect...etc.
To resolve interest conflict, the parties need to come to a point of defining and expressing their
individual interests may be jointly addressed.
 Structural conflict: Is a type of conflict that is caused by the external forces such as limited
physical resources or authority, geographical constraints (distance or proximity), time or
organizational change.
 Value conflict: Is a conflict caused by perceived or actually incompact belief systems: values,
beliefs, norms…etc. this category of conflict also includes cultural and regional differences.
These kinds of differences are recognized as a core factors within the value conflict in the process
of violent conflict.
1.5. Major theories of conflict
 Theories of conflict are the explanations put forward to explain causes of conflict. The causes
of conflict are numerous and complex, thus creating problem of analysis of specific conflict
situations. The theories are advanced to simplify the causes by looking at them in categories.
 The theories explaining causes of conflict include structural theory of conflict, Marxist theory,
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international capitalist theory, realist theory, biological theory, and psychological theory of
conflict.
Structural Theory of conflict

 The structural theory attempts to explain conflict as a product of the tension that arises
when groups compete for scarce recourses. The central argument in this sociological
theory is that conflict is built into the particular ways societies are structured or organized.
It describes the condition of the society and how such condition or environment can create
conflict. Structural conflict theory identifies such conditions as social exclusion,
deprivation, class inequalities, injustice, political marginalization, gender imbalances,
racial segregation, economic exploitation and the likes, all of which often lead to conflict.
 Structuralists maintain that conflict occurs because of the exploitative and unjust
nature of human societies or because of domination of one class by another. The
theory is however deficient in its on-sidedness of looking at causes of conflict. It, for
instance, does not see the bright sides of racial or ethnic diversity and the strength
that a society may derive from pluralism. It only sees the flaws. The structural theory
thus makes sense only when conflicts are viewed from the broadest possible perspective,
and only if the observer opts to ignore alternate causes of the conflict.
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Marxist Theory of conflict
 The Marxist theory is an offshoot of the Marxian explanation of society. Society is
divided into unequal classes: the one is strong, rich and noble and bears the tag of
bourgeoisie, who controls the instrumentality of state; while the other is deprived,
socially deflated, financially infantile and is called the proletariat. There is a constant
struggle between the two, but he that has the financial muscle controls both the state and
the poor, and that is the structure of society. Thus, the Marxist stand is that the state is
itself a product of the irreconcilability of class antagonisms. The state is therefore
structured to be in a perpetual state of conflict.
 The rich controls the state as well as means of production. The rich thus grows wealthier
at the expense of the poor, who lives at his mercy and is implicitly embittered by the
development. The central argument of Marxism is thus that capitalism is at the heart of
the state, and that same capitalism is exploitative and oppressive and has been responsible
for the polarization of the society (and state) into two incompatible classes.
 The limitation of Marxism is similar to that of structuralism. It looks at every issue of
conflict from the viewpoint of dialectical materialism alone. This economic prism is
not enough to capture every aspect of conflict causation.
International Capitalism Theory of conflict

 This theory captures the historical import of colonialism and imperialism. According to
Hobson (2006; 1902), in his classic, Imperialism: A Study, the external drive of western
nations propelled by the Industrial Revolution began to create numerous platforms for
conflict. The search for raw materials, need to invest surplus capital and search for new
markets outside Europe compelled an imperialist pathway as the western countries
desperately sought such markets, raw materials and investment climates at the expense
of the peace and prosperity of the locals in what is now known as the Global South.
This led to colonization, as well as collision of cultures and civilizations and ultimately
conflict.
 Imperialism thus became the last and highest stage of capitalism. This international
capitalism theory aptly explains the collaboration of western financial markets and capital
today, as it solidified and extended their economic influences all over the world, and has
leveraged them for economic exploitation of the developing economies, which has created
imbalances between what is now the North and South.
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Economic Theory of conflict
 Economic theory of conflict explicates the economic undercurrents in conflict causation.
There is considerable interface between politics (power, resources or value) and scarcity.
People seek power because it is a means to an end, more often, economic ends.
Communities feud over farmlands, grazing fields, water resource, et cetera, and groups
fight government over allocation of resources or revenue. Scarcity, wants, needs, or the
fear of scarcity is often a driving force for political power, contention for resource
control, and so forth. Conflict is thus not far-fetched in the course of such palpable fear
or threat of scarcity. Just as the fear of poverty and deprivation could lead to fraud or
corruption; so is threat of or real famine, deprivation, mismanagement of scarce
resources, could propel conflict over resource control.
Realist Theory of conflict

 Political realism explains conflict as an inherent attribute of man. As far as men live
with their ‗baggage of emotions‘, so will conflict remain a part of their habitat; and as
long as man remains a ‗political animal‘ with interests different from others, so shall
conflict of interests remain a feature of society. More importantly, as long as there are
scarce resources where most men are ambitiously seeking comfort or control of
resources, conflict is inevitable. Realism is a good blend of the Marxist, international
capitalist and economic theories in the explication of conflict.
 The realist theory describes conflict as a product of the innate selfish nature of man, who
continues to pursue his own best interests even if the ox of others is gored. This selfish
nature of man leads to ―competitive processes‖ between actors who seek to have all or
most of available scarce resources. It is such attribute that is taken to the inter-state level,
which leads to erratic behavior, hegemonic propensities, imperialism, et cetera, that can
impel resistance as well as violent opposition and consequently heat up the international
system.
Biological Theory of conflict

 This theory explains that human nature is genetically transferred from generation to
generation. Just as parents can genetically transfer their godly qualities and ingenuity to
their offspring, so can the evil nature of man be genetically transferred. The argument
goes that since our ancestors were instinctively violent beings and since we evolved from
them, we must bear aggressive or destructive impulses in our genes.
 This theory explains that the irresistible outbreaks of violent impulses are ascribed to
fixed biological propensities. As such, aggression is spontaneous and could be
uncontrollable. This line of thought underlines the assumption about the greatness of
certain people, clan or family; or the pride, arrogance and aggressiveness of a particular
nation or group.
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Frustration-anger-aggression
 This is a psychological hypothesis of conflict that posits that it is natural for man to react
to unpleasant situations. The hypothesis is drawn from the frustration-
aggression theory propounded by Dollard and Doob, et al (1939), and further developed
by Miller (1948) and Berkowitz (1969). The theory says that aggression is the result of
blocking, or frustrating, a person's efforts to attain a goal.
 Frustration is described as the feeling we get when we do not get what we want, or when
something interferes with our gaining a desired goal, as shown in the case of Niger
Delta, and that of the Palestinians or Hutus in Rwanda. Anger implies feeling mad in
response to frustration or injury; while aggression refers to flashes of temper
(Tucker-Lad, 2013). The frustration aggression theory states that aggression is caused
by frustration. When someone is prevented from reaching his target, he becomes
frustrated. This frustration can then turn into anger and then aggression when something
triggers it.
 When expectation fails to meet attainment, the tendency is for people to confront others
they can hold responsible for frustrating their ambitions or someone on whom they can
take out their frustrations. And when aggression cannot be expressed against the real
source of frustration, displaced hostilities can be targeted to substitute objects, that is,
aggression is transferred to alternate objects.
1.6. Functions of Conflict

Conflicts can neither be eliminated altogether nor even be suppressed for long. Conflicts can be
functional (productive) if they are carefully handled and if they are fertile to allow those parties
in conflict by effectively discussing and coming up with workable solutions to them. The main
concern is that weather the conflicts at many levels of human interactions can be resolved either
with constructive or destructive consequences. In this sense a conflict resolved constructively has
a positive function on relationships and organizations. Some of the functions are the following;
 At individual level conflict prevents stagnation by stimulating interest and curiosity and as
result it can be seen as the medium through which problems can be aired and solutions
arrived at. This kind of conflict is often the root of personal and social change and as such
it is often part of the process of testing and assessing oneself giving the experience and the
pleasure of full and active use of one‘s capacities.
 On group level interactions, conflict demarcates groups from one another and thus helps
establish group and personal identities in different ways. For example, external conflict or
inter-group conflict often fosters internal cohesiveness. Similarly, internal conflicts or
intra-group conflicts also frequently help to revitalize existing norms or contribute to the
emergence of new norms.
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 Discussing conflict makes those parties in conflict more aware and able to cope with
underlying problems.
 Conflict strengthens relationships and heightens morale. Those parties in conflict realize
that their healthy relationships should be strong enough to withstand the test of conflict and
beneficiary if they are free from conflict. They can release their tensions through discussion
and problem solving.
 Conflict promotes awareness of self and others. Through conflict, people learn what makes
them angry, frustrated, and frightened and what is important to them. Knowing what we are
willing to fight for tells us a lot about ourselves. Knowing what makes or colleagues
unhappy helps us to understand them.
 Conflict encourages psychological development. Persons become more accurate and
realistic in their self-appraisal. Through conflict, persons take others perspective and
become less egocentric, conflict helps persons to believe that they are powerful and capable
of controlling their own lives. They do not simply need to endure hostility and frustration
but can act to improve their own lives.
 In the above sense, conflicts in general and/or social conflicts in particular can be seen as
mechanisms for adjustment of norms to new conditions. However, these positive functions
of conflict depend on the choice of strategy by the conflicting parties involved regarding to
how to resolve the incompatibilities and whether their choices result in constructive
outcomes to both parties.
 On the contrary, destructive conflict is that which is done through excessive reliance on
coercion and heavy threat. Equally, if the conflict reduced its noble cause, such as the quest
for social justice, to a power struggle for unilateral gains and if the parties remain
dissatisfied with the outcomes where the party that achieves victory leaves the legacy of
defeat and a sense of loss on the defeated party, the conflict can be considered as
destructive as all of these inhibit the possibility of maximizing mutual communication.
1.7. Consequences and Outcomes of Conflict

Conflict is natural-neither good nor bad. It can have positive as well as negative consequences
for the parties involved and for the larger social system of which the disputing parties are
members.
1. 7.1.Positive results of conflict
On the positive side, conflict can provide an opportunity for creativity, renewed energy,
development, and growth to individuals, groups, and organizations resulting in increased
cohesion/unity and trust. It can lead as well to more effective personal and organizational
performance.
 Positive consequences for individuals involved in conflict can include:

 Recognition of the interests of the disputing parties: Most conflicts can end with at least
some satisfaction of the legitimate interests of the parties involved, usually through
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working out an integrative agreement of mutual benefit. Relay do conflicts have to end in
clear-cut win/lose outcomes.
 A sharpened sense of identity and solidarity: As individuals engage in conflict, their
sense of which they are as persons with unique needs tends to be sharpened. As they
differentiate themselves from one another, they uncover ways in which they are similar
and different. The similarities enhance rapport and a sense of solidarity; the differences
help to sharpen a sense of identity and unique contribution to the whole.
 Interaction: Conflict tends to promote interaction at an interpersonal level and create a
new system of which all parties are instantly a part. As one party changes, all the other
parties must then change to restore the equilibrium.
 Internal change: As disputing parties experience conflict and engage in dialogue with
others of differing needs and beliefs, they are confronted with the prospect of making
adjustments in their positions. The pressure to explore new ideas and feelings can
challenge an individual to move from rigidity to flexibility, with consequent internal
change.
 Clarifying the real problem: Conflicts often emerge around different solutions to a
particular problem shared by the disputing parties. As dialogue is conducted and the
parties begin to explore the interests underlying the contrary positions, the real problem
can be identified and addressed.
 Conflicts often involve groups and occur between group members. Conflict can have
positive consequences for all group members that are parties to the dispute. Some of them
include:
 Increase trust: As individuals enter into any experience with one another in group
settings, trust is low, resulting in defending behaviors on the part of groups members. In
conflict situations this tendency is exacerbated, because the disputing parties perceive the
possibility of their failing and being hurt. As individuals share their thoughts and feelings
with one another in the group, trust builds, freeing energy previously spent in defending.
 Increase productivity and results: As conflict is exposed and the parties involved express
their thoughts and feelings, the group can be healed of some of the negative feelings that
tend to prevail in conflict situations. As the group is freed of diverting of emotions and
discovers new solutions, its productivity and creativity can increases.
 Group unity: Conflict fosters a sense of group unity and identity as disputing parties
reconcile individual differences. Without differences and diversity, groups can become
stagnant and lose a sense of its creativity and uniqueness.
1.7.2. Negative Results of Conflict
Often the positive benefits of conflict are overshadowed by harmful consequences that result
when disputing parties attempt to achieve their goals at the expense of the others. Such forcing
exchanges often bring about an escalation of the conflict that is difficult to reverse. When forcing
methods are used, any of the following negative consequences can follow:
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 Minor differences can escalate into major conflicts involving actions imposed by a power
person or group on another, resulting in greater loss to the system as a whole.
 The number of issues in the conflict can increase, resulting in greater complexity and
greater difficulty in managing the situation.
 Specifics can give way to global concerns, which often cause the person to be equated
with and confused with the issue at stake, or the entire relationship between the disputing
parties can be called into question.
 The intention can shift from getting a specific interest satisfied to beating the other parties
at all costs. The number of parties can increase, making it even more difficult to
deescalate the conflict
1.8. Conflict outcomes
Conflict always manifests itself in terms of some specific outcomes. Three possible outcomes
can emerge:
 Dominance or imposition: resulting in resentment/ antipathy and sometimes destructive

consequences.
 Withdrawal or avoidance : resulting in resentment and lowered self-image.
 Compromise or resolution: resulting in at least some beneficial consequences being
achieved.
These outcomes are dependent on the approach or strategy used to deal with the conflict. The
choice among alternative strategies can spell the difference between antipathy and mutual
respect. In summary, the outcomes result from five basic approaches, or strategies, available to
address to conflict situation:
 Collaboration: A win-win strategy based on a clear positive vision and the use of
problem solving to ensure that the interests of all parties are met. This approach results in
maintaining strong interpersonal or intergroup relationships while ensuring that all parties
achieve their interest.
 Compromise: A mini-win/mini-lose strategy based on a solution that partially satisfies
the interests of the parties involved. This approach results in the parties' attempting to win
as much as possible while preserving the interpersonal or intergroup relationships as
much as possible.
 Accommodation: A yield-lose/win strategy wherein one party yields to the other party/s
to protect and preserve the relationships involved.
 Controlling: A win/lose strategy based on imposing a particular preferred solution on
the other party (or parties). This approach results in sacrificing the interpersonal or
intergroup relationships to achieve a desired outcome, regardless of the consequences to
the other party or parties.
 Avoiding: A lose/lose strategy based on withdrawing and choosing to leave the conflict.
This approach results in abandoning both the desired outcomes and the opportunity to
enhance the relationship.
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1.9. Factors Affecting the Course and Consequences of Conflict
The issue of particular conflict takes constructive or destructive course and outcome depends on many
factors. Identifying these determinants helps to identify the broader environment a particular conflict
operates and the potential for devising solutions towards constructive outcomes.
 The process of conflict and conflict orientation of the parties

The type of conflict orientation taken by the parties about the process of conflict is one
determinant. For one of the conflict orientation conflict is viewed as mutual problem that
highlights mutual interest and seeks the enhancement of mutual power. This kind of
orientation encourages a trusting and friendly orientation towards the other party with a
positive interest in the other party‘s welfare and needs and encourages readiness to respond to
any positive signal by the other party. A perceived similarity in beliefs and values, a sense of
common bonds and interests between conflicting parties, although are no guarantee to the
impossibility of conflict, are likely to lead to constructive outcome carried through honest,
open communication with persuasive rather than coercive form and intent.
An alternative conflict orientation is the one that led to destructive conflict outcomes. This
orientation defines the conflict process in win-loss terms that seeks to maximize power
difference with a readiness to exploit the other party‘s needs and weakness. This supports the
tendency to polarize opposed values and beliefs.
 Prior relationship of the parties

If the conflicting parties did have cooperative bonds before the conflict and if those bonds
were stronger than their present day incompatibilities and served significant needs of the
parties, then those earlier bonds could encourage parties to seek cooperative ways of settling
their present problems. For example if the parties have other common goals to cooperate
about (i.e. super- ordinate goals) which is bigger than their present day goal incompatibility,
and if they have common allegiances to a common community, religious, creed, state etc, then
present day cooperation is likely. The weaker and the more insignificant were pas
cooperation, the more difficult it is to find cooperative tendencies to the present day problem.
 The nature of the conflict

By ‗nature of the conflict‘ the reference is to the different dimension of the conflict in terms
of such factors as the centrality of the conflict issue, the rigidity of the issue in the eye of the
parties, the number of issues involved and their interconnectedness, the degree to which the
conflict is acknowledged and the like.
 The centrality of the issue of conflict:- an issue that is infringed up on something

considered vital to a person‘s physical well being, socio economic position, self
esteem etc is central. These issues are considered to be human needs which are
universal needs by human being irrespective of their difference in sex, race, and
ethnicity, political and economic difference and are considered non negotiable. These
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are central conflict issues that characterize intractable conflicts for they are most
irreconcilable ones. Thus, more central an issue becomes, the less likely to easily
resolve it constructively and vice versa.
 Issue rigidity:- Independent of the issue centrality, the perceived lack of satisfactory
alternative for the initially desired outcome or the lack of satisfying method of
attaining the outcome characterizes issue rigidity. Sometimes parties become issue
rigid for psychological reasons that make them perceive the proposed alternative as
unsatisfactory to their standards. At other times, objective environmental factors cause
issue rigidity by posing scarcity limit the possibility of finding acceptable substitutes
and restrict the possibility if the conflict is over necessities. Still relevant is the nature
of the issue which by itself makes it harder for parties to substitute for it. For example,
a party that defines its conflict issue rigidly in terms of having more power or total
victory or more status over the other party find itself too rigid and uncompromising
thereby making constructive conflict resolution harder.
 The number and interconnectedness of the issues:-if the conflict revolves around a
single issue, then the chances are that the winner takes all and the loser gets none. For
this reason the conflict will be heavily contested. But in some conflicts there could be
many comparable issues in a single conflict that can be the source of win-win
opportunities for all of the parties in one or another of the issues thus enabling
constructive resolution. However, if the many different issues in a single conflict are
highly interconnected constructive conflict in a way of win-win outcomes is unlikely.
The high degree of the interconnectedness among the issues establishes the perception
that a loss in one implies a loss on all others.
 Consensus on the importance of the different issues:-If conflicting parties value the
significance of the conflicting issue with equal importance to them, it is very difficult
to find a compromising solution without dissatisfying one of them.
 The degree of acknowledgement about the conflict:-Unacknowledged conflict where
the conflicting parties do not recognize the fundamental conflict or the existence and
legitimacy of one another‘s existence will remain harder to resolve because it remains
latent and the manifest confrontations are not about the primary issue. Unless the
underlying conflict is recognized and dealt with, it will remain a breeding ground for
various manifest conflicts that resist constructive and long term resolution.
 The characteristics of the parties in the conflict:- the ideologies, personalities, social
positions and personal resources of the conflicting parties determine whether conflict
take constructive or destructive course and outcome. Similarities in the basic
perspective of the relationship between the conflicting parties are usually conducive to
compatibility and hence to constructive resolution of the conflict. In addition,
personalities may well be conducive to competitive or cooperative relationships. Such
characteristics as aggressiveness, authoritarianism, need for dominance,
suspiciousness, dogmatism, tendency to derogate others etc and other characteristics
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such as egalitarianism, trusting, open-mindedness, toleration of ambiguity etc
complement competitive and cooperative and hence destructive and constructive
resolution of conflict respectively.
 Third parties:- the attitudes, strength and resource of interested third parties in a
conflict are often crucial determinants of the course of conflicts. Third parties who
expect to maximize their own power by playing the two conflicting rivals off against
each other could instigate or aggravate conflict. Even this negative third party
intrusion can indirectly facilitate the constructive resolution of the conflict. The
conflicting parties, fearing the intrusion of this kind of third parties, could find
themselves unity against the outsider intervention. In a much more positive sense third
parties who are prestigious, powerful, and skillful may deliberately facilitate a
constructive resolution of conflicts by helping provide the problem-solving resources(
such as institutions, facilities, expertise, personnel, social norms, procedures etc) to
facilitate the discovery of mutually satisfactory solution.
Chapter Two
Conflict Analysis
2.1. Introduction
Conflict analysis is the important prerequisite before a conflict management or resolution will be
done. It is an important first step in the conceptualization of interventions that initiate and
sustain social transformation processes. It is also a basic stage towards the resolution of conflict;
a good conflict analysis leads to suitable solutions. Conflict analysis should inform
decision-making with the aim of improving the effectiveness of conflict prevention, conflict
management and peace building interventions, including the effectiveness of development
and humanitarian assistance. It is important to emphasize that conflict analysis is an ongoing
process and not a static, one-off exercise. Different conflict analysis frameworks, methods and
tools have been developed.
2.2. What is conflict analysis and why is it important?
 For many of those who are engaged in practical work on conflict, the concept of conflict analysis
seems quite remote from their own experience. It is sometimes seen as requiring objectivity and
neutrality rather than personal experience and strong emotion. This kind of perspective takes
conflict analysis as ‗research methodology‘ in the strict sense. However, this is not the
understanding of the concept one sees conflict analysis as a practical process of examining and
understanding the reality of the conflict from a variety of perspectives to establish the particular
basis on which strategies can be developed and actions planned.
 Conflict analysis is the systematic study of the profile, causes, actors, and dynamics
of conflict. These purposes of conflict analysis is to enhances a better understanding of the
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dynamics, relationships and issues of the conflict situation and helps us to plan and carry out
better actions and strategies. It also helps development, humanitarian and peace
building organizations to gain a better understanding of the context in which they
work and their role in that context.
 Conflict analysis can be carried out at various levels (e.g. local, regional, national, etc) and
seeks to establish the linkages between these levels. Identifying the appropriate focus for
the conflict analysis is crucial: the issues and dynamics at the national level may be
different from those at the grassroots. But while linking the level of conflict analysis (e.g.
community, district, region or national) with the level of intervention (e.g. project, sector,
policy), it is also important to establish systematic linkages with other interrelated levels
of conflict dynamics. These linkages are important, as all of these different levels impact
on each other. For example, when operating at the project level, it is important to
understand the context at the level at which the project is operating (eg local level), so the
focus of the analysis should be at that level; but the analysis should also take account of the
linkages with other levels (eg regional and national). And similarly when operating at the
regional, sector or national levels.
 Conflict analysis is not, and should not be, considered as a one-time exercise. As conflicts are
dynamic and situations are developing, the exercise must be a non-going process. This essentially
helps us to adapt our actions to changing factors, dynamics and circumstances.
 Conflict analysis is thus a central component of conflict-sensitive practice, as it
provides the foundation to inform conflict sensitive programming, in particular in
terms of an understanding of the interaction between the intervention and the
context. This applies to all forms of intervention – development, humanitarian, peace
building– and to all levels – project, program, and sectoral. In other words, conflict
analysis will help: to define new interventions and to conflict-sensitize both new and
pre defined interventions (eg selection of areas of operation, beneficiaries, partners,
staff, time frame). (Planning stage).
 In general conflict analysis helps conflict resolution practices and practitioners :
 To understand the background and history of the situations and current events.
 To examine the sources and consequences of conflict;
 To identify all the relevant groups involved in the conflict.
 To understand the perspectives all groups have and to know more about how they relate to
each other.
 To find out more about what is going on in a conflict;
 To identify areas where they need to know more;
 To begin to see ways in which they can influence the situation;
 To identify factors and elements which underpin/highlight conflicts.
 To learn failures and successes.
2.3. Key Elements/ of Conflict Analysis
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The key elements/ of conflict analysis helps to develop a comprehensive picture of the
c o n f l i c t context in which you operate. Generally, ―the elements of conflict analysis can
never be exhaustive, nor provide absolute certainty. Conflict dynamics are simply too
complex and volatile for any single conflict analysis process to do them justice.
Nevertheless, you should trust your findings, even though some aspects may remain
unclear. Do not be discouraged; some analysis, no matter how imperfect, is better than
no analysis at all.
 Conflict Profile
A conflict profile provides a brief characterization of the context within which the
intervention will be situated.
Key questions for a conflict profile
 What is the political, economic, and socio-cultural context? e.g. physical geography,
population make-up, recent history, political and economic structure, social
composition, environment, geo-strategic position.
 What are emergent political, economic, ecological, and social issues? eg elections,
reform processes, decentralization, new infrastructure, disruption of social networks,
mistrust, return of refugees and internally displaced persons (IDPs), military and
civilian deaths, presence of armed forces, mined areas, HIV/AIDS.
 What specific conflict prone/affected areas can be situated within this context? eg,
areas of influence of specific actors, frontlines around the location of natural resources,
important infrastructure and lines of communication, pockets of socially marginalized
or excluded populations.
 Is there a history of conflict? eg critical events, mediation efforts, external intervention.
Note: this list is not exhaustive and the examples may differ according to the context
 Causes of conflict
In order to understand a given context it is fundamental to identify potential and existing
conflict causes, as well as possible factors contributing to peace. Conflict causes can be
defined as those factors which contribute to people‘s grievances; and can be further
described as:
 structural causes – pervasive factors that have become built into the policies,
structures and fabric of a society and may create the pre-conditions for violent
conflict.
 proximate causes – factors contributing to a climate conducive to violent conflict
or its further escalation, sometimes apparently symptomatic of a deeper problem
 triggers – single key acts, events, or their anticipation that will set off or escalate
violent conflict.
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 Protracted conflicts also tend to generate new causes (eg weapons circulation, war
economy, culture of violence), which help to prolong them further.
 As the main causes and factors contributing to conflict and to peace are identified, it is
important to acknowledge that conflicts are multi -dimensional and multi-causal
phenomena – that there is no single cause of conflict. It is also essential to establish
linkages and synergies between causes and factors, in order to identify potential areas
for intervention and further prioritize them. Some of the tools in Annex 1 – eg
Clingendael / Fund for Peace, RTC – offer methods to assess the relative importance
of different factors. Many tools developed for conflict analysis also categories conflict
causes or issues by governance, economics, security and socio-cultural factors.
Key questions for an analysis of conflict causes
 What are structural causes of conflict? eg illegitimate government, lack of political

participation, lack of equal economic and social opportunities, inequitable access to
natural resources, poor governance.
 What issues can be considered as proximate causes of conflict? eg uncontrolled
security sector, light weapons proliferation, human rights abuses, destabilizing role of
neighboring countries, role of diasporas.
 What triggers can contribute to the outbreak / further escalation of conflict? eg
elections, arrest / assassination of key leader or political figure, drought, sudden
collapse of local currency, military coup, rapid change in unemployment, flood,
increased price/scarcity of basic commodities, capital flight.
 What new factors contribute to prolonging conflict dynamics? eg radicalization of
conflict parties, establishment of paramilitaries, development of a war economy,
increased human rights violations, weapons availability, development of a culture of
fear.
 What factors can contribute to peace? eg communication channels between opposing
parties, demobilization process, reform programmes, civil society commitment to
peace, anti-discrimination policies.
Note: This list is not exhaustive and the examples may differ according to the context.
 Actors
People are central when thinking about conflict analysis. The Resource Pack uses the
term ―actors‖ to refer to all those engaged in or being affected by conflict. This includes
individuals, groups and institutions contributing to conflict or being affected by it in a
positive or negative manner, as well as those engaged in dealing with conflict. Actors
differ as to their goals and interests, their positions, capacities to realise their interests,
and relationships with other actors .
Interests, goals, positions, capacities and relationships
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 Interests: the underlying motivations of the actors (concerns, goals, hopes and fears).
 Goals: the strategies that actors use to pursue their interests.
 Positions: the solution presented by actors on key and emerging issues in a given
context, irrespective of the interests and goals of others.
 Capacities: the actors‘ potential to affect the context, positively or negatively. Potential
can be defined in terms of resources, access, social networks and constituencies, other
support and alliances, etc.
 Relationships: the interactions between actors at various levels, and their perception
of these interactions.
Some approaches distinguish actors according to the level at which they are active
(grassroots, middle level, top level). In particular, conflict transformation theory attaches
great importance to middle level leaders, as they may assume a catalytic role through
their linkages both to the top and the grassroots. In any case, it is important to consider
the relationships between actors / groups at various levels and how they affect the
conflict dynamics.
Particular attention should be paid to spoilers, ie specific groups with an interest in the
maintenance of the negative status quo. If not adequately addressed within the
framework of preventive strategies, they may become an obstacle to peace initiatives.
Similarly, it is important to identify existing institutional capacities for peace, in order to

further define entry points to address causes of violent conflict. Capacities for peace
typically refer to institutions, organizations, mechanisms and procedures in a society for
dealing with conflict and differences of interest. In particular, such actors need to be
assessed in relation to their capacity for conflict management, their legitimacy, the
likelihood of their engagement, and the possible roles they can adopt.
Key questions for an actor analysis
 Who are the main actors? eg national government, security sector (military, police),
local (military) leaders and armed groups, private sector/business (local, national,
trans-national), donor agencies and foreign embassies, multilateral organizations,
regional organizations (eg African Union), religious or political networks (local,
national, global), independent mediators, civil society (local, national,
international), peace groups, trade unions, political parties, neighboring states,
traditional authorities, Diaspora groups, refugees / IDPs, all children, women and
men living in a given context. (Do not forget to include your own organization!)
 What are their main interests, goals, positions, capacities, and relationships? eg
religious values, political ideologies, need for land, interest in political
participation, economic resources, constituencies, access to information, political
ties, global networks.
 What institutional capacities for peace can be identified? eg civil society, informal
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approaches to conflict resolution, traditional authorities, political institutions (eg
head of state, parliament), judiciary, regional (eg African Union, IGAD, ASEAN) and
multilateral bodies (eg International Court of Justice).
 What actors can be identified as spoilers? Why? eg groups benefiting from war
economy (combatants, arms/drug dealers, etc), smugglers, ―non conflict sensitive‖
organizations.
 Dynamics
Conflict dynamics can be described as the resulting interaction between the conflict
profile, the actors, and causes. Understanding conflict dynamics will help identify
windows of opportunity, in particular through the use of scenario building, which aims to
assess different possible developments and think through appropriate responses.
Scenarios basically provide an assessment of what may happen next in a given context
according to a specific timeframe, building on the analysis of conflict profile, causes and
actors. It is good practice to prepare three scenarios: (a) best case scenario (ie describing
the optimal outcome of the current context; (b) middle case or status quo scenario (ie
describing the continued evolution of current trends); and (c) worst case scenario (ie
describing the worst possible outcome).
Broadly speaking, conflict dynamics refers to the process of change in the course of the conflict
to widen (such in new issues), to intensify (such in new actors) and broaden (to such in new
victims) or to follow the reverse process to bringing in benign or malignant outcome of conflict
for final settlement or protraction respectively. The four basic stages of conflict have different
sub stages. Initiation/emergence/ stage include difference, contradiction, polarization, and some
occasional violence. The stage of escalation includes intensified violence and the war. The stage
of de escalation begins with cease fire to agreement, to normalization. The final stage of
settlement is a post conflict situation of reconciliation.
 Description of the stages of conflict
 Difference: It is the initial condition of the emergence of the perception of

incompatibility of goals. Such kinds of differences are omnipresent in every social
relationship and as a result are not always destructive. It is only when such initial
difference, be it objective or subjective, is left to persist without early effort to deal
with it that it progress into the next higher stage of towards escalation .i.e.
contradiction.
 Contradiction: At this stage one or both of the parties start recognizing their difference
as real and began occasional confrontational behavior to show their intent although
these are by no means organized and sustained. At this stage the conflict may remain
latent. If no effort at resolving the conflict at this stage then many elements in the form
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of negative attitudes and perceptions start built-in it to take it into the next stage of
escalation.
 Polarization: this is the stage that follow the persistence of the initial difference
without an early opportunity peacefully solve it were either untried or unsuccessful
leading the conflict parties become unequivocally aware of their problem and chose to
engage in increased mobilization of resources and support to pursue their interest non
peacefully. Polarization is characterized by very strained relationship in which the
earlier difference and contradiction start grow into the perception of irreconcilable
antagonisms. The parties start considering their incompatibility as unbridgeable
through non violent means. As a result conflict becomes more and more manifest.
 Violence/war follows if polarization persists. This stage is the highest crises stage of
the escalation characterized by complete breakdown of communication and the
outright use of direct violence. The process of de-escalation begins with cease fire.
 Cease fire is the first de escalatory step where the parties agree to a temporary
stoppage of the direct violence. If it made to persist then a stage of agreement
commences.
 In agreement stages parties may agree to take some formal and initial resumption of
talks to deal with some of the immediate issues of the violence. At interstate conflicts,
this may include the signing of peace treaties, exchange of prisoners of the war,
clearing of land mines etc
 Normalization is the stage where the parties would try to put themselves back into pre
polarization and pre violence levels.
 Reconciliation is the last stage in the full cycle of a conflict. Here the parties try to
address and settle their initial source or root source of the incompatibility and envision
a lasting peace. If unsuccessful the parties can be said to find themselves in motion
towards repeating the conflict all the way backwards again
 For Galtung, contradiction involves a structural violence; so it requires removal of the
structural injustice and inequality. In other words, he suggests peace building. Violence and
war is the manifestation of a conflict behavior; so changing the violent behavior generally
demands peace keeping and peace enforcement strategies.
 Difference, contradictions and even polarization are sustained not only by objective sate of
affairs but also by subjective perceptions and misperception which often times are the results
of negative attitude and perception and sustained by certain cultural elements; so change in
these regard require a broader strategy that aims at transforming cultural violence. The much
more elaborated model by Oliver Ramsbotham, Tom Woodhouse and Hugh Miall can be
presented in a table below:
The Conflict Progression Model for Contingency Approaches to Holistic Peace
Stages of Strategic Responses Tactical Responses (skills and Process
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Conflict
Difference Cultural Problem solving workshops, support for

indigenous conflict resolution mechanisms,
peace building conflict resolution training, fact finding
missions, peace commissions and the like
Contradiction Structural Development assistance, civil society

development, governance training and
peace building institutional building, human right training,
Track II (non official mediation),
problem solving and the like
Polarization Elite peacemaking Official (Track I) mediation, special envoys,

negotiation, coercive diplomacy,
direct preventive peace keeping etc
Violence Peace keeping Interposition, crisis management,
and violence containment etc
War War limitation Peace enforcement,
peace support and stabilization etc
Cease fire Peace keeping Preventive peace keeping,
disarmament, confidence building and
security enhancing works etc
Agreement Elite peace making Electoral and constitutional reform,
power sharing arrangements and

decentralization,
problem solving workshops etc
Normalization Structural Collective security and cooperation
peace building arrangements, economic resource based
cooperation and development and the like.
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Reconciliation Cultural Inquiry, justice, truth and reconciliation
commissions, peace media development, peace
peace building and conflict awareness education and training,
cultural exchange and initiatives, sports, etc
The above table shows a contingency and complementarities model, in which ‗contingency‘
refers to the nature and phase of the conflict, and ‗complementarity‘ to the combination of
appropriate responses that need to be worked together to maximize chances of success in
conflict resolution.
Key questions for an analysis of conflict Dynamics
What are current conflict trends? e.g. escalation or de-escalation,

changes in important framework conditions.
What are windows of opportunity? e.g. are there positive developments? What factors
support them? How can they be strengthened?
What scenarios can be developed from the analysis of the conflict profile, causes
and actors? e.g. best case, middle case and worst case scenarios.
2.4. Tools and techniques(Methods) for Conflict Analysis
 Tools are useful aids for the people who carry out conflict analysis and play different roles.
These tools include: the root cause analysis (helps stakeholders to examine the origins and
underlying causes of conflict); the issue analysis (examines deeply the issues that contribute
to conflict and those that give rise to a specific conflict); the stakeholder identification and
analysis (identifies and assesses the dependency and power of different stakeholders in a
conflict.), the 4Rs (rights, responsibilities, returns, relationships) examines the rights,
responsibilities and benefits of different stakeholders); the conflict timeline (examines the
history of a conflict and improves the understanding of the sequence of events that led to the
conflict); and mapping conflict over resource use (shows the present and future
geographicallocation of resources and determines the primary issues of conflict).
 The tools and techniques for analyzing conflict situations that we shall see are suggested by
such practitioners and academicians as Simon Fisher, Dekha Ibrahim Abdi, Richard Smith
and others based on the real experience of people around the world who have used the tools,
adapting them to their own needs. They suggest that conflict analysis is not a one-time
exercise. It must be an ongoing process as the situation is developing, so that we can adapt
our actions to changing factors, dynamics and circumstances for the following reasons
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 To understand the background and history of the situation as well as current events.
 To identify all the relevant groups involved, not just the main or obvious ones.
 To understand the perspectives of all these groups and to know more about how they
relate to each other.
 To identify factors and trends that underpins conflicts.
 To learn from failures as well as successes.
 Conflict analysis can be done with the help of a number of simple, practical and adaptable
tools and techniques. Below, we shall explain some of the tools for conflict analysis and
illustrate how they have been used in specific cases.
 Some of the techniques/methods for conflict analysis are Stages of Conflict, Timelines, and
Conflict Mapping(which describes what is happening in the conflict) , The ABC Triangle
(Attitude, Behavior, and Context)( which stresses the interrelation of three main parts of
conflict in the form of a triangle), the Doughnut (the Onion), which helps to discover hidden
elements of conflict) , The Conflict Tree(helpful to analyze specifically intergroup conflicts);
and the pyramid or island method (which facilitates the distinction between underlying
causes of conflict and positions and interests of parties), and Force-Field.
 Often these conflict analysis frameworks are best used in combination and flexibly,
according to the situation we are analyzing, with one tool highlighting certain factors or
issues or points in time, which are then analyzed with other tools. One‘s own analysis, and
that of the people he\she works with, will be informed by own experiences, perceptions and
values and may well be different. The tools may not necessarily be scientific, but they do
open the way to inclusive and effective action
I. Stages of conflict Framework for Conflict Analysis

The tool is based on the understanding that conflicts change over time, passing through different
stages of activity, intensity, tension and violence. It is, therefore, helpful to recognize these
stages and use them together with other tools to analyze the dynamics and events that relate to
each stage of the conflict. The basic analysis comprises five different stages, which generally
occur in the order given here (although there may be variations in specific situations) and may
recur in similar cycles. These stages are:
Pre-Conflict: This is the period when there is an incompatibility of goals between two or
more parties, which could lead to open conflict. The conflict is hidden from general view,
although one or more of the parties are likely to be aware of the potential for confrontation.
There may be tension in relationships between the parties and/or a desire to avoid contact
with each other at this stage.
Confrontation: At this stage the conflict has become more open. If only one side feels
there is a problem, its supporters may begin to engage in demonstrations or other
confrontational behavior. Occasional fighting or other low levels of violence may break out
between the two sides. Each side may be gathering its resources and perhaps finding allies
with the expectation of increasing confrontation and violence. Relationships between the
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sides are becoming very strained, leading to a polarization between the supporters of each
side.
Crisis: This is the peak of the conflict, when the tension and/or violence is most intense.
In a large-scale conflict, this is the period of war, when people on all sides are being
killed. Normal communication between the sides has probably ceased. Public statements
tend to be in the form of accusations made against the other side(s).
Outcome: One way or another crisis will lead to an outcome. One side might defeat the
other(s), or perhaps call a ceasefire (if it is a war). One party might surrender or give in to
the demands of the other party. The parties may agree to negotiations, either with or
without the help of a mediator. An authority or other more powerful third party might
impose an end to the fighting. In any case, at this stage the levels of tension,
confrontation and violence decrease somewhat with the possibility of a settlement.
Post-Conflict: Finally, the situation is resolved in a way that leads to an ending of any
violent confrontation, to a decrease in tensions and to more normal relationships between
the parties. However, if the issues and problems arising from their incompatible goals
have not been adequately addressed, this stage could eventually lead back into another
pre-conflict situation.
As a practical tool to plan and carry out better actions and strategies, the stage of conflict
framework must be seen as a graphic that shows increasing and decreasing intensity of
conflict plotted along a particular time scale. Its purpose includes the following:
 To see the stage and cycles of escalation and de escalation of conflict.

 To discuss where the situation is now.
 To try to predict future patterns of escalation with the aim of preventing these from
occurring.
 To identify a period of time to be analyzed later using other tools.
II. Timelines Framework for Conflict Analysis
In principle, a timeline is a very simple tool. It is a graphic that shows events plotted against
time. It lists dates (years, months or days, depending on the scale) and depicts events in
chronological order. We could use this method to show a succession of events in your own life,
for example, or the history of your country. In this case, you can use timelines to show the
history of a conflict. In a conflict, groups of people often have completely different experiences
and perceptions: they see and understand the conflict in quite distinct ways. They often have
different histories. People on opposing sides of the conflict may note or emphasize different
events, describe them differently, and attach contrasting emotions to them.
The aim of using timelines in this way is not to try to arrive at a 'correct' or 'objective' history but
to understand the perceptions of the people involved. For this reason, the different events
described by opposing groups are an important element in understanding the conflict. The
timeline is also a way for people to learn about events that are about each other's history and
perceptions of the situation. And in discussing their different perceptions of the conflict, and the
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events that each group commemorates, they will develop a richer understanding of their shared
situation. A timeline is not primarily a research tool, but a way to prompt discussion and
learning. In conflict it is to be expected that people will disagree about which events are
important and how to describe them. We aim to reach a point where the parties in a conflict can
accept that others may have valid perceptions, even if these are opposed to their own. Timeline
as a tool is a graphic that shows events plotted against a particular time-scale with the following
distinct proposes suggest when to use it. Timeline helps
 To show different viewpoints o f history in a conflict.

 To clarify and understand each side‘s perception of events.
 To identify which events are most important to each side.
III. Conflict mapping as tool /Framework for Conflict Analysis
Mapping is a technique used to represent a conflict graphically, using certain conventional symbols, to
depict the nature of the relationship between the main conflicting parties and their relationship with
other parties to the conflict. Conflict mapping is an important one towards acknowledging a particular
conflict and also as analyzing conflict and finding indicators of how to treat different conflicts
adequately. Conflict mapping is useful not just for explaining, but also for responding to conflicts at
all levels. It helps to place the parties in relation both to the problem and to each other. When people
with different viewpoints map their situation together, they learn about each other's experiences and
perceptions.
 Conflicting mapping can be used in variety of ways such as geographical maps showing the
areas and the parties involved, mapping of issues, mapping of power alignments, mapping of
needs and fears. Mapping on its own, however, cannot provide all of the answers. As with all
these tools, it only provides partial insight into the nature of a conflict. Often it is the issues
underlying the observed relationships that lie at the root. The following tools offer some
insight into how to begin to uncover those underlying causes.
IV. The ABC Triangle Framework/ as tool for Conflict Analysis
This analysis is based on the premise that conflicts have three major components: the context
or situation, the behavior of those involved and their attitudes. These three factors influence
each other, hence leading from one to another. For example, a context that ignores the
demands of one group is likely to lead to an attitude of frustration, which in turn may result in
protests. This behavior might then lead to a context of further denial of rights, contributing to
greater frustration, perhaps even anger, which could erupt into violence. Work that is done to
change the context (by making sure that demands are acknowledged), to reduce the level of
frustration (by helping people to focus on the long-term nature of their struggle) or to provide
outlets for behaviors that are not violent will all contribute to reducing the levels of tension.
In the case of any given conflict different parties have different experiences and contrasting
perceptions. For these reasons, they are likely to attribute the conflict to different causes. One
side may, for example, claim that the root problem is injustice, while another side may feel
that it is insecurity. Each group is focused on the issues that concern it most, and particularly
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the areas where it is suffering most. All of these causes and issues are real and important, and
all will haw to be addressed before the conflict can be resolved and the situation improved.
In using the ABC Triangle it is important to be sure about on whose perception the analysis is
based upon. You could do the analysis entirely on your own perception of the realities in the
conflict if you are closely involved in it. Otherwise, it will be important to put yourself in the
shoes of each of the main parties and look at the issues in the conflict as they see it in terms of
'context', 'behavior' and 'attitude'. The ABC triangle helps in the following ways:
 To identify the three sets of factors for each of the major parties.
 To analyze how these influence each other.
 To relate these to the needs and fears of each party.
 To identify a starting point for intervention in the situation.
The following are the time to employ ABC triangle more usefully:
 Early in the process to gain a greater insight into what motivates the different parties.
 Later to identify what factors might be addressed by an intervention.
 To reveal how a change in one aspect might affect another
V. The Onion Framework /as tool for Conflict Analysis
This framework is based on the analogy of an onion and its layers with how the conflict
parties narrate their conflict. The outer layer contains the positions that they take publicity, for
all to see and hear. Underlying these are interests – what we want to achieve from a particular
situation. Finally, at the core are the most important needs we require to be satisfied. It is
useful to carry out this Onion analysis for each of the parties involved.
In times of stability, when relationships are good and trust is high, our actions and strategies
may stem from our most basic needs. We may be willing to disclose these needs to others and
to discuss them openly, if we trust the others. And through analysis and empathy, they may be
able to grasp our needs even before we disclose them. In more volatile or dangerous
situations, when there is mistrust between people, we may want to keep our basic needs
hidden. To inform others of them would revel our vulnerability and perhaps give them extra
power over us. But if we hide things from the other side, they are also less likely to be able to
grasp our needs through analysis or empathy, as a result of lack of knowledge and because
mistrust changes people's perceptions of each other.
Thus, in a situation of conflict and instability, actions may no longer come directly from
needs. People may look at the more collective and abstract level of interests and base their
actions on these. When those interests are under attack, they may take up and defend a
position that is still further removed from their basic needs. This type of analysis is useful for
parties who are involved in negotiation, to clarify for themselves their own needs, interests
and positions. Then, as they plan their strategies for the negotiation, they can decide how
much of the interior 'layers' - interests and needs – they want to reveal to the other parties
involved.
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A long-term goal is to improve communication and trust to the point where people can reveal
their own real needs and also understand and try to meet each other's needs. However, even
before this point is reached people can be challenged to examine whether their actions and
strategies are a good way to further their own interests and meet their own needs. The essence
of Onion is that it is a way of analyzing what the different parties to a conflict are saying with
the following proposes:
 To move beyond the public position of each party and understand each part‘s interests
and needs.
 To find the common ground between groups that can become the basis for further
discussions.
VI. The Conflict Tree Framework /as tool for Conflict Analysis
This tool is best used within groups - i.e. collectively rather than as an individual exercise. In
many conflicts there will be a range of opinions concerning questions such as: What is the
core problem? What are the root causes? What are the effects that have resulted from this
problem? What is the most important issue for our group to address?
The Conflict tree offers a method for a team, organization, group or community to identify the
issues that each of them sees as important and then sort these into three categories: (1) core
problem(s), (2) causes and (3) effects.
 You will find when you try this tool that many issues can be seen as both causes and effects
of the conflict. For example, scarcity of food is often a cause of conflict between groups, but
it is also often the consequence of normal cultivation being disrupted by violence. This can
form the basis for a useful discussion about the cycle of violence and the way in which
communities can become trapped by conflict. There is no reason why, graphically, the same
issues cannot appear in both places. The specific purpose that a conflict three framework
provides includes the following:
 To stimulate discussion about causes and effects in a conflict.
 To help a group to agree on the core problem.
 To assist a group or a team make decisions about priorities for addressing conflict
issue.
 To relate causes and effects to each other and to the focus of the organization.
VII. Force-Field Analysis as tool /Framework for Conflict Analysis
This tool can be used to identify the different forces influencing a conflict. Whenever you are
taking some action to bring about change, there will be other forces that are either supporting
or hindering what you are trying to achieve. This tool offers a way of identifying these
positive and negative forces and trying to assess their strengths and weaknesses. It can also
help you to see more clearly what is maintaining the status quo. The framework can be put
into use in the following way.
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 Begin by naming your specific objective, i.e. the action you intend to take or the
change you desire to achieve. Write this objective at the top of the page and draw a
line down the centre of the page.
 On one side of the line, list all the forces that seem to support and assist the action or
change that is to happen. Next to each one draw an arrow towards the centre, varying
the length and/or thickness of the arrow to indicate the relative strength of each force.
These arrows are pointing in the direction of the desired change.
 On the other side of the line, list all the forces that seem to restrain or hinder the
desired action or change from happening next to each one draw an arrow pointing
back towards the centre, against the direction of desired change. Again, the length
and/or thickness of each arrow can indicate its relative strength.
 Now, consider which of these forces you can influence, either to strengthen the
positive forces or to minimize in some way the negative forces, so as to increase the
likelihood of the desired change taking place.
 You may want to review your plan of action and make modifications to your strategy
in order to build upon the strengths of positive forces, while also trying to minimize, or
remove, the effects of the negative ones.
As a tool for analyzing both positive and negative forces in a conflict force-field analysis has
such proposes as;
 To identify those forces either support or hinder a plan of action or a desired change.
 To assess the strength of these forces and our own abilities to influence them.
 To determine ways of increasing the positive forces or decreasing the negative forces.
Force-field analysis is effective if used in the following situation
 In the planning of an action or strategy to clarify the forces that might support or
hinder what is intend to do.
 While implementing a strategy of change to assess the strength of other forces and
your ability to influence these.
VIII. Pillars as tool /Framework for Conflict Analysis
This graphic tool is based on the premise that some situations are not really stable, but are
'held up' by a range of factors or forces – the 'pillars'. If we can identify these pillars and try to
find ways to remove them or minimize their effect on the situation, we will be able to topple a
negative situation and build a positive one. A pillar is a graphic illustration of elements or
forces that are holding up an ‗unstable‘ situation. This can be carried through the following
way.
 Identify the unstable situation (conflict, problem or injustice) and show this as an
inverted triangle standing on one point.
 Next identify the forces or factors seeming to maintain this situation. Show them as
the 'supporting pillars' on both sides of the triangle.
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 Consider how each of these pillars might be weakened or removed from the situation.
Briefly list your strategies for each pillar.
 Also consider what stable situation could replace this unstable one.
While doing pillar analysis one side of the pillars holding up the conflict are mostly those
caused by, or relating to, the authorities, e.g. harsh policies, exclusion of groups, and/or fear.
On the other side, there are pillars representing lack of coordination, security concerns and
prejudice, which pertain directly to the concern of others. Some of the pillars might be more
crucial than others, and some are more difficult to influence than others. It may be that work
will have to be done by colleagues at other levels to influence, for instance, the politics
concerning the situations and policies of the donor countries. However, the situation will
improve if any of these pillars is weakened or removed.
Having looked at the pillars that support the conflict, problem or unjust situation, the next step
is to devise definite actions or strategies that could address each pillar and weaken or remove
it. Pillar analysis makes more sense when the aim is:
 To understand how structures are sustained.

 To identify factors that maintain undesirable situation.
 To consider ways to weaken or remove these negative factors, or perhaps to change
them to more positive forces.
XI. The Pyramid as Tool For Conflict Analysis
A pyramid is graphic tool showing levels of stake-holders in a conflict. This tool is needed when
you start to analyses conflicts that have more than one level. With this method, you identify the
key parties or actors at each level. Often most social conflicts have three or two levels. As you
consider each of the levels in a diagram you may find that most of your work is aimed at only
one level. This can make it difficult to bring about lasting change because of the effect of the
other levels on your context.
This type of analysis helps you' to locate critical resource people who are strategically placed
and embedded in networks that connect them vertically within the setting and horizontally in
the conflict. These are people who have the ability to work with counterparts across the lines
of division, therefore, they can be key allies for working within the various levels as well as
working simultaneously at all levels. The specific situation that calls for the use of the
pyramid analysis framework includes;
 To identify key actors including leadership at each level.

 To decide at which level you are currently working on and how you might include
other levels.
 To assess what types of approaches or actions are appropriate for work at each level.
 To consider ways to build links between levels.
 To identify potential allies at each level.
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In general, all the above discussed conflict analysis frameworks are not intended to be a rigid
formula, but rather flexible and practical aids to help in understanding the complexities of a
particular situation in order to then build more effective strategies for addressing the conflicts
we are concerned about. They are often more effective when used in a variety of
combinations- for example, applying an analysis of Stages with Mapping, ABC Triangles and
a Pyramid - in order to explore from various perspectives different aspects of and factors in
any given situation. This kind of multi-dimensional analysis can help enhance your
understanding of the situation and suggest a variety of entry points for action.
Chapter Thee
Conflict Resolution Mechanisms (CRs)

3.1. Introduction
The theoretical formulations about specific resolution approaches and the subsequent
development of specific strategies, methods, process and skills in Conflict Resolution /CR/ have
been evolving and developing over time. In the process some concepts have lost their relevance,
change their meaning, replaced by more refined conceptualizations, new perspectives have been
added or concepts which were formerly used separately or jointly have been reformulated. One
the one hand, this trend shows how the discipline attempts to adapt itself to changing dynamics
of conflict and peace and refines its approach. On the other hand, the same trend results in the
proliferation of terms with apparent similarity but have equally distinct meaning and practical
implications risking certain degree of confusion.
3.2.The Key Terminologies
 Conflict/Dispute/ Settlement, as one approach to ending of conflict, refer to the reaching of

agreement between conflict parties themselves without the necessary involvement of third
parties. Oftentimes, conflict settlement is achieved through unassisted negotiation between
the parties themselves and as a result it is employed in conflict situations which are relatively
less intense and less violent and the issues are not that much fundamental to disturb the basic
relationship of the parties. If conflicting issues and dynamics have become more serious as in
the case of intractable conflicts, i.e. those involving identity issues, conflict settlement is not
the preferred approach. In case it is preferred, it is not as the final settlement but as a positive
start to further steps. This is because conflict settlement approaches do not focus on the
underlying structural conditions and the pervasive conflict attitudes.
 Conflict Containment requires the involvement of third parties between the conflicting
parties with the aim of alleviating the intensity of the conflict, to constrain the fighting
geographically before it spread into other areas and if the conflict is active to terminate the
violence at the earlier possible time.
 Conflict management/conflict regulation/- is a generic term covering the whole range of
positive conflict handling including conflict settlement and containment approaches and
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methods. These three interrelated approaches under the rubric of conflict management can be
differentiated from the other approaches such as conflict resolution and conflict
transformation in terms of their understanding of what they consider as a peace. As we have
seen in earlier sections conflict has three basic elements each constituting a parallel elements
or types of violence and peace. Johan Galtung identifies three types of violence and two
types of peace based on the reversal conditions of the three elements of conflict and/or
violence.
 Conflict Resolution-apart from being a generic name for a discipline and as an approach by
its own right considers peace in a much more positive peace sense and attempts to address
both the structural and direct violence aspects and certain aspects of cultural violence with
the broader goal of building sustainable and positive peace.
 Conflict transformation- represents the deepest level of conflict resolution. The focus of
conflict transformation includes and goes beyond institutional changes that support positive
peace by a deeper transformation of the structures of social identity and justice which, by
breaking down the social bonds of the community relationship among those who used to
know each other and tolerated each other, lead them into violence. Conflict transformation
opts to transform the social institutions and the discourse that reproduce the culture of
violence and the structural violence through a rebuilding of fractured social bonds and alter
people‘s expectations of themselves and others away from violence and toward peaceful
relations.
3.3. Alternative Terminologies in Conflict Analysis and Resolution
Phrases such as peacekeeping, peacemaking, peace enforcement, peace building are often used
in relation to CAR activities. These phrases are not that much different from the terminologies
we discuss in the above section and of course they can be used interchangeably. In fact the
difference is more of a matter of preference than substance. More specifically, one can say that
these ‗alternative terminologies‘ are attempts at invention or modification of terms to better
capture the broad spectrum of peace and peacemaking possibilities carried out chiefly by the UN
in meeting its major mandate of ‗maintaining international peace and security‘. Peacekeeping,
peacemaking, peace enforcement, peace building are multiple options for contributing to
peace arranged on a continuum between shorter-term intervention and security approaches,
known as peacekeeping, to longer-range prevention and institutional change approaches, known
as peace building. In other words, peace keeping and peace enforcement resemble conflict
management whereas peacemaking and peace buildings are more like conflict resolution and
conflict transformation respectively. However, the fact that the UN prefers these alternative
terminologies in view of its international character makes it necessary to define them in
international context as the UN is there mainly to deal with conflicts that are of interstate
character although this traditional fixation is somehow changing in response to the nature of
most conflicts after the end of the Cold War where conflicts have become internal in character
than before.
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Peace keeping: refers to the interposition of an international armed force often mandated by
the UN to separate armed forces of two belligerent sovereign states. Peace keeping is often
carried out following the consent of the two parties. In the UN context, Peacekeeping
operations were traditionally thought as pre resolution deployment. But later on they were re
considered best suited for use as measures to be instituted after a peace agreement is attained
between the warring parties to implement impartially what has been agreed in case the
conflicting find it unlikely to be able to cooperate easily among themselves after a
devastating war. Peacemaking is a UN approved intervention of a much deeper and multiple
level of intervention to induce parties to a conflict to reach agreement voluntarily by
rendering different and often less coercive encouragements and facilitation works.
Peacemaking: is a more proactive engagement different from the peacekeeping attempts
which only aim to establish safety and achieve the ―minimum‖ condition of peace, which is
the absence of overt physical violence, through such efforts as avoidance of disruptive
conflict and violence, limiting or managing interactions, and punishing or excluding the
parties deemed responsible for outbreaks. Peacemaking has broader goal of resolving the
particular conflict by going relatively deeply into the root sources of that conflict in
comparison to peacekeeping activities.
Peace enforcement: one of the ‗instruments‘ for international organizations. It means that
wars are brought to a halt through direct and overwhelming military intervention under the
auspices of multilateral organs. As a matter of principle, peace enforcement can be seen as
part of peacekeeping activities when the interposition of the internationally deployed army
cannot restrain the conflicting parties from violence. Equally, peace enforcement can also be
used when violence between groups within a state causes serious humanitarian crisis for the
civilian people and when the parties fail to allow humanitarian assistance to the suffering
populace. But one thing that must not be forgotten here is that principles and practices so far
in practice demonstrate the importance of political interests in the part of the peace enforcers.
Peace Building: underpins the work of peacemaking and peacekeeping by addressing
structural issues and the long-term relationships between conflictants. Peace building tries to
overcome the contradictions which lie at the root of the conflict.
3.4. A Foundation for the Terminological Differentiation
Conflictual attitude: represents the existence of cultural violence which uses certain cultural
elements to justify violent actions against others and instigate people to kill others playing on
people‘s emotions, feelings and beliefs. For Galtung reversing Conflictual attitude and the
cultural violence contributes to positive peace.
Conflictual behavior :represents observable display of inflicting physical and psychological
injuries and pain on individual or groups by an identifiable actor and this is referred to as
direct violence. For Galtung reversing Conflictual behavior and the direct violence it gives
rise to often results in negative peace.
Contradiction: represents the existence of conditions which are uneven /unequal/ life
chances, unequal distribution of resources and unequal decision making power. According to
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Galtung, this constitutes structural violence. Structural violence is an indirect violence
because it operates systematically and slowly, without a necessary direct violence, to erode
human values and shorten life. Example, slavery although structurally violent, the day to day
relationship between a slave and a master does not always involve direct violence. For
Galtung, reversing structural violence together with cultural violence and of course direct
violence results in positive peace
Based on the above formulations one can say that conflict management approach considers
conflict largely in terms of direct conflict and the peace it tries to achieve is negative peace by
emphasizing on achieving the ―minimum‖ condition of peace, which is the absence of overt
physical violence.
3.5. Defining conflict resolution
 Conflict resolution refers to all the methods and process adjusts activities that aim to
address the causes of conflict and seeks to build new and lasting relationship between
conflicting individuals and groups. It is also a technique employed to identify and resolve
conflict between different people, groups and states Conflict resolution as a situation where
the conﬂicting parties enter into an agreement that solves their central incompatibilities,
accept each other‘s continued existence as parties and cease all violent action against each
other. Conflict resolution could be applied in the de-escalation phase after a violent conflict
has occurred. Apart from being a generic name for a discipline and as an approach by its
own right considers peace in a much more positive peace sense and attempts to address both
the structural and direct violence aspects and certain aspects of cultural violence with the
broader goal of building sustainable and positive peace.
3.5.1. Typologies of Conflict Resolution Activities
In general, the terminologies discussed above give a general introduction to their meanings. Each
of these approaches utilizes different methods, process and skills which separately or together
constitute the activities of conflict analysis and resolution field. Some of these are introduced
below.
I. Negotiation: is the process in which conflicting parties seek to settle their problem through a
peaceful compromise of some of their positions to one another in a way of reciprocity often
without the presence of an intermediary. Negotiation is a communication process for
enabling disputing parties to achieve a mutually agreed –on outcome with respect to their
differences. In simplest terms, negotiation is a discussion between two or more disputants
who are trying to work out a solution to their problem. This interpersonal or inter-group
process can occur at a personal level, as well as at a corporate or international (diplomatic)
level. Negotiations typically take place because the parties wish to create something new that
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neither could do on his or her own, or to resolve a problem or dispute between them. The
parties acknowledge that there is some conflict of interest between them and think they can
use some form of influence to get a better deal, rather than simply taking what the other side
will voluntarily give them. They prefer to search for agreement rather than fight openly, give
in, or break off contact.
 Depending on the different aspect and character of the conflict, negotiations can be of two
type; unassisted and assisted negotiation.
 Unassisted negotiation is the one in which the parties to a conflict get start it by
themselves without the assistance of intermediaries. But conflicts which involve very
complex issues, as distributional or value based issues, are very difficult for an unassisted
negotiation to be used. In these cases, conflict parties find it difficult to initiate and
pursue the negotiation by their own. This could be the result of emotional trap where the
parties avoid initiative for unassisted negotiation fearing the consequence of appearing
weak to one another. Financial trap also calls for assisted negotiation where the parties
need a resourceful third party to provide for different facilities. Remember! Negotiations
are often costlier engagements. Power imbalances between the conflicting parties
together with the desire by the stronger party to prevail in the negotiation process also
hinder the weaker party from consenting to unassisted negotiation. These difficulties call
for assisted negotiation by the involvement of a neutral third party.
 Assisted negotiation can take different forms, such as mediation, facilitation
/conciliation/, arbitration etc. Although we shall see these in detail later on, let‘s see the
broader conditions that provide interested third parties ‗entry points‘ to take on the
responsibility for assisted negotiation. Often times conflicting parties find themselves in a
dilemma between compromising their public posture (positions) in spite of the difficulty
of continuing the violence; the cost of which becomes higher to bear by both parties.
When conflicting parties are frozen in this dilemma, third party proposal for negotiation
are likely to be welcomed as the best possible chance to settle the dilemma that caught
the parties with grace. Another entry point for assisted negotiation is when the parties to a
conflict get convinced that giving into the demands of third party‘s intervention to assist
talks does not amount to surrendering their ultimate control over the final outcome. In
other words, conflicting parties are likely to go for assisted negotiation if the negotiation
process proceeds with non-binding outcomes or if the process leaves the conflicting
parties to retain a veto power over the final outcome or a veto to disqualify any
intermediary who seems biased or incompetent. These issues of neutrality and
competence of the third party are equally important elements which determine the
willingness of conflicting parties to go for assisted negotiation. When parties agree a
prior to be abide by the final outcomes of the assisted negotiation the process refers to as
arbitration. Here the arbitrator is chosen and agreed upon by the two parties and listens to
each side of the argument and arrive at a decision to which the parties have already agree
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to be abiding by. So arbitration represents the surrendering of control over outcomes by
the parties.
II. Mediation: Mediation is a form of assisted negotiation which involves the assistance of a
third party who is/are not involved in the dispute/conflict, who may be of a unique status that
gives him or her certain authority with the disputants/conflicting parties; or perhaps an
outsider who may be regarded by them as a suitably competent and neutral go-between. It
must be kept in mind that all forms of mediation are in some way negotiations but not
necessarily visversa. Conceptually, negotiation has to do with argument, bargaining and
compromise between protagonists trying together to find their way towards a settlement
whereas mediation, with the necessary involvement of a third party, is a psychological effort
to change perception both of the conflict and of the enemy to the extent that both protagonists
gain some hope of reasonable resolution and so are more prepared to negotiate more
seriously. Mediation, in this sense, has the purpose to abate the illusions of the responsible
protagonists so that they may better be able to make realistic efforts to end the conflict by
negotiation. This kind of mediation is called pure mediation to differentiate it from the much
more used form of mediation i.e. ‗mediation with a muscle‘.
 As different from arbitration, mediation does not in principle imply to the conflicting parties
to be abide by the final outcome. Mediations are more of consensual process of assisted
negotiation. Here the point is that, at least theoretically, mediators do not have formal basis
of authority to demand conflicting parties to surrender their veto over the final outcome. But,
in practice one can make a distinction between „pure‟ vs. „mediation with a muscle‟ as two
types of mediation practices.
 Pure mediation: it is more of a voluntary process in which the parties to the mediation not
only retain the veto over the final outcomes but decidedly reduce the role of the mediator to
procedural assistance only. An example of this is the process of conciliation or facilitation.
Here the facilitator assumes the role of encouraging the parties to move towards negotiation
focusing entirely on the process and procedural issues agreed up on by the parties. These
include offering a good office for the parties, making sure meetings takes place in the time
and place, seeing meeting spaces are arranged as agreed upon, ensuring that notes and
minutes of the meetings are kept etc. Facilitators do not give their own ideas on the
substantive issues but focus on the communication by monitoring the quality of the dialogue
intervening only through questions when there is a need to enhance understanding. Although
limited and procedurally oriented, the role of facilitators is important. Through their good
office, facilitators make possible a negotiation process that would have been otherwise
impossible. Facilitators encourage parties to give a try to the possibilities of coming to the
table without giving up any of their control over the substance of their negotiating issue. In
fact facilitation, by encouraging parties to deal with less controversial and procedural issues
first enhances confidence building towards a further dialogue on substantive issues. This is
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because; parties who experience a certain degree of agreement over less controversial issues
are likely to develop a sense of accomplishment in the process and a desire to go on further.
 ‗Mediation with a muscle‟ is when the third party has certain extra leverage to force the
outcome of mediation although the conflicting parties formally retain their veto. In this case,
a mediator affects the content and substance of the bargaining process by providing
incentives for the parties to negotiate or by issuing ultimatums directly with aim to change
the way issues are framed and the behavior associated with them.
 Mediation is a very complex undertaking with long duration to bear result as most conflicts
may not be settled quickly unless some non-mediatory force merely suppress the symptoms
of the violence temporarily without removing the causes. The complexity, therefore, results
from the fact that in any given conflict mediators may change, their role may be redefined,
issues may alter, indeed even the parties involved in the conflict may and often do change.
Mediators may intervene early in a conflict in an attempt to prevent it, or later on when
fatalities have already reached high levels. In order to fully understand this complex reality a
comprehensive definition of mediation is that it is a process of conflict management, related
to but distinct from the parties‘ own negotiations, where those in conflict seek the assistance
of, or accept an offer of help from, an outsider (whether an individual, an organization, a
group, or a state) to change their perceptions or behavior, and to do so without resorting to
physical force or invoking the authority of law.
 From the definition we recognize that any mediation situation comprises four elements (a)
parties in conflict, (b) a mediator, (c) a process of mediation, and (d) the context of
mediation. All these elements are important in mediation. Together they determine its nature,
quality, and effectiveness, as well as why some mediation efforts succeed while others fail.
What mediators do in their efforts to resolve a conflict may depend, to some extent, on who
they are and what resources and competencies they can bring to bear. Ultimately, though,
their efforts depend on who the parties are, the context of the conflict, what is at stake, and
the nature of their interaction making mediation, above all, adaptive and responsive.
 Motives for mediation
 Why does mediation even take place? The process is time-consuming, involves risks and
uncertainty and often does result in failure. Besides, not every actor can afford or has the
credibility and time to mediate. So, why mediate? Why parties in conflict would be prepared
to relinquish control over aspects of their conflict management experience. Why would a
third party be willing to intervene in a serious conflict that has defied many attempts at
resolution? In fact the parties‘ motivation and commitment to accept and engage in
mediation undoubtedly affect the outcome of mediation. Effective mediation requires
consent, high motivation, political will, and active participation.
 Traditional approaches to mediation assume that conflict parties and a mediator share one
reason for initiating mediation: a desire to reduce, abate, or terminate a conflict. To this end,
both sides may invest considerable personnel, time, and resources in the mediation. For
those who alternatively view mediators as political actors, the motivation for the third party
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to engage in mediation and expend resources is because they expect to resolve a conflict and
gain something from it. For many actors, accordingly, mediation is a policy instrument
through which they can pursue some of their interests without arousing too much
opposition. The relationship between a mediator and disputants is thus never entirely devoid
of political interest.
 Different mediators have different motives for intervening in a conflict. When the mediator
is an unofficial individual the motives for initiating mediation may include a desire to be
instrumental in changing the course of a longstanding or escalating conflict, gain access to
major political leaders and open channels of communication, put into practice a set of ideas
on conflict management, and spread one‘s own ideas and thus enhance personal stature and
professional status.
 Where a mediator is an official representative of a government or an organization, as is
often the case, another set of motives may prevail. Such persons initiate mediation because
they have a clear mandate to intervene in disputes (e.g. the Charters of the African Union,
and the UN), they may want to do something about a conflict whose continuance could
adversely affect their own political interests., they may be directly requested by one or both
parties to mediate, they may see mediation as a way of extending and enhancing their own
influence by becoming indispensable to the parties in conflict, or by gaining the gratitude
(and presumably the political goodwill) of one or both protagonists (e.g. the frequent efforts
by the United States to mediate the Arab–Israeli conflict).
 Adversaries or conflicting parties in conflict have a number of motives for desiring
mediation. Mediation may help them reduce the risks of an escalating conflict and get them
closer to a settlement; Each party may embrace mediation in the expectation that the
mediator will nudge or influence the other party toward their position; Both parties may see
mediation as a public expression of their commitment to an international norm of peaceful
conflict management; They may want an outsider to take much of the blame should their
efforts fail; or They may desire mediation because a mediator can be used to monitor,
verify, and guarantee any eventual agreement. One way or another, parties in conflict – and
a mediator – have compelling reasons for accepting, initiating, or desiring mediation.
 Whether we are studying ethnic, internal, or international conflict, we should understand
that mediation is not a totally a unique or a distinct humanitarian response to conflict
motivated only by altruism. A mediator, through the very act of mediating, becomes an
actor in a conflictual relationship. This relationship involves interests, costs, and potential
rewards, and exemplifies certain roles and strategies. A mediator‘s role, at any one time, is
part of this broad interaction.
 To be effective, mediators‘ roles must reflect and be congruent with that interaction.
Mediation as practice revolves around the choice of strategic behaviors that mediators
believe will facilitate the type of outcome they seek to achieve in the conflict management
process. As such, mediation is a coherent and planned activity involving various roles,
tactics, processes, and strategies that can be exercised in the practice of mediation.
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 Focusing on the content, process and procedural aspects of conflict management three
fundamental mediator strategies are (a) communication-facilitation, (b) procedural, and (c)
directive strategies. In the first strategy, a mediator typically adopts a fairly passive role,
channeling information to the parties, facilitating cooperation with little control over the
more formal process or substance of mediation. The second strategy enables a mediator to
exert a more formal control over the mediation process with respect to the environment of
the mediation. Here a mediator may determine structural aspects of the meetings, and
control constituency influences, media publicity, the distribution of information, and the
situational powers of the parties‘ resources and communication processes. Directive
strategies are those strategies of mediation which are the most powerful form of
intervention. Here a mediator affects the content and substance of the bargaining process by
providing incentives for the parties to negotiate or by issuing ultimatums. Directive
strategies deal directly with and aim to change the way issues are framed and the behavior
associated with them.
 The choice of any one of these strategy is clearly affected by the nature of the relationship
between the parties, and the context of the conflict. Mediators adapt their style of
intervention to meet the requirements of the situation, and that certain styles or strategies of
mediation will be generally more effective in certain situations. But there are certain general
factors that determine the choice of strategy such as conflict intensity, previous relationship,
mediator identity etc.
 Conflict intensity usually refers to such factors as the severity of conflict, the level of
hostilities, the number of fatalities, the level of anger and intensity of feeling, the types of
issues at stake, and the strength of the parties‘ negative perceptions. When conflict
intensity is low conflict parties are concerned do not want third party intrusion.
Mediators‘ behavior in such cases may simply involve being a catalyst for negotiations,
in which case the least invasive form of intervention would be used. In contrast to that, in
high-intensity conflicts mediators are keen to prevent further escalation and do so by
adopting more active forms of intervention. High-intensity conflicts are more associated
with higher levels of mediation involvement.
 Previous relationship has to do with how past experiences of conflict and conflict
management affects current behavior and determines choice of mediation strategy. Any
current conflict management is affected by previous conflict management efforts and any
learning that may have taken place. The past does, indeed, cast a shadow on the present.
Previous mediation efforts can establish norms and a certain relationship between the
parties, and these can affect their current disposition and behavior.
 Mediator identity; this describes the position of a mediator. This will clearly affect the
choice of a strategy. Who the mediator is determines to a large extent what a mediator
can do. At the most basic level, some mediators have the full range of resources and thus
the full range of strategies available to them. Others can only use communication
strategies, as they simply do not have access to expensive resources.
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 In general mediation behavior and choice of strategies cannot be prescribed in advance. They
are part of the overall structure of a mediation event and context. Mediators choose strategies
that are available, feasible, permissible, and likely to achieve a desired outcome. Mediation
behavior is adaptable; it reflects to a large extent the context in which it takes place. This tells
us that mediation is not only about the presence of intentions, but also requires certain
resources and skills. Basically, it requires the ability to provide a wide range of ideas,
options, and strategies to be considered in the process. For this reason often it is advised that
team mediations are better for it brings together different people with a specter of positions to
the conflict parties and talents.
 Apart from the technical competence and willingness certain interpersonal skills are required.
Intermediaries must wield a level of respect and trust and must give the correct impression to
the parties that their positions are well understood and well represented by the intermediaries.
If in group, intermediaries must have human skills that complement one another that would
create a balanced environment. This would include individuals with characteristics such as
people with tremendous contact, people with oratory/persuasive/skills and people with quick
mind to take advantage of opportunities and people with deeper analytical skills and
understanding of the conflict history and people with sensitivity etc.
 Although real-world mediations, be it at international or national levels, differ in many ways
due to the uniqueness of every conflict, one can identify some of the common strategies,
process, tactics and skills involved. In what to follow you will be provided with some of the
fundamental features of mediations and/or assisted negotiations and the related constructive
roles of the intermediaries. This can be seen as divided into three major stages or phases of
pre-negotiation, negotiation, and post-negotiation.
 Pre-negotiation/mediation phase: some of the initial or preparatory actives by the
intermediaries to get start the process of negotiation begins with meeting with the parties to
assess their interest with an attempt to convince the parties about the possibility of producing
better outcomes through consensual approach. A core strategy of this initial encounter is the
activity of representation. This is where the intermediary conducts the assessments of the
conflict parties to choose the leaders to represent the positions, interests and needs of their
group. Often a conflicting party does have different interest groups in it. So part of the
representation is to carefully devise strategies to make the representation accommodative
enough of the real character of the conflicting parties. Another core strategy of the
intermediary at this stage is to devise a strategy/ method of inquiry. The strategy must
involve identification of the origins, development of the conflict, the issues and the current
status of the conflict. The aim is to produce a draft protocol to begin the
negotiation/mediation process. This report must equally be fair and be based on the past
experience and concerns of the conflicting parties. The fairness in the eye of the parties
serves the following benefits. First, it assists the creditability of the intermediaries in terms of
demonstrating their objectivity, well informedness, and their clear positive intentions.
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Secondly, it helps create an opportunity for conflicting parties hear their own positions and
concerns and their opponents. This help the parties distil the central issues for negotiation.
 The negotiation stage: Once actual negotiation is started, the role of the intermediary
requires certain strategies. One of the core strategies is empowerment action. Often
mediations/assisted negotiations precede a relation of inequality (in terms of skills,
experience or resource) between the parties. In this context, intermediaries must create an
environment of equality so as not to expose the process be exploited by the stronger party. In
situations of inequality and imbalance the mediators concern for balancing and producing a
fair ground and fair result should outweigh their strict adherence to impartiality. Strict
adherence to impartiality in the condition of obvious inequality would give the stronger party
a chance to dominate the process and ensure the imposition of injustice. Another core
strategy at the negotiation stage is manipulation of the agenda. The intermediaries must
encourage parties to deal first with less controversial and procedural issues. This strategy
helps the purpose of confidence building and good will on the parties of the parties by giving
them a sense of accomplishment and a confidence in the workability of the process. Another
strategy at this stage is control of communication. Often actual negotiations are not like every
ordinary conversation and are likely to be filled with emotionally charged and irrelevant
exchanges that would cause deadlock. In these situations, intermediaries must constantly
remind the parties to remain focused on the agenda of the negotiation and may even require
them to breakup sessions for informal behind the scene negotiations with each parties
separately. These informal sessions give the intermediaries the chance to interpret to each
parties the real arguments and concerns of their opponents. Informal sessions are useful to
the parties with the assistance of the intermediaries to explore where their common areas lay
and thus to develop compromise. In addition, it helps them develop empathy and more open
ended mind to accommodate each other‘s interest. Furthermore, informal sessions can be
taken as opportunities for the intermediaries to present a more concrete draft proposal for the
parties‘ further consideration, amendment, modification and reconciliation of their divergent
positions. This last strategy is called invention of options for parties by the intermediaries.
While doing so the intermediaries must take great care not to become particularly supportive
of one option against another or should not be seen as such. If so, that would give a blow to
their neutrality. Inventing options only involves suggesting alternatives to the groups
dispassionately.
 Post negotiation stage: Although intermediaries have far less direct role in post negotiation
phases, they can still have significant roles to play. The difficulty for a direct role is because
ratification of the agreed text goes beyond the confines of the negotiation setting as it
requires the individuals who reached the agreement to go back to their respective
constituencies, who may have some unrealistic expectations, and seek approval of the draft
agreement. However, the intermediaries could enhance the chances of ratification or
legitimatization by providing their assessment of the process of the actual negotiation process
and how the participants done it effectively in manners to enhance the gains to their
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constituency. A particularly useful strategy would be to emphasize the emotionally healing
aspect of the whole encounter by capitalizing on the common denominators between the
conflicting parties and their respective constituency and by constantly appealing to the
transcendental humanity that might make the conflict issue at hand comparatively less
significant.
III. Problem-solving: is a more ambitious undertaking in which conflict parties are invited to
reconceptualize the conflict with a view to finding creative, win–win outcomes. Problem
solving workshops can be seen as sharing some features from what we above call pure
mediation. But they are distinguished for their less if not indirect political appearance as they
primarily try to engage individuals whose position in the respective conflicting parties is not
big enough to the extent of being the key decision makers regarding the conflict. However, in
mediations establishing relationship with the key decision makers regarding the conflict is
the way to changing the habits of the mind that generate and sustain the causes of the
conflict. Reconciliation is a longer term process of overcoming hostility and mistrust
between divided people.
IV. Arbitration: - describes a paralegal process lead by an independent third party, namely the
arbitrator. A decision toward resolution was taken by the arbitrator based on legal regulations
and the perception of the conflicts as stated by the parties involved. This result is binding and
the parties have limited control over it. The process can take place voluntarily o by legal
enforcement and is meant to relieve civil courts, being less formal and costly and much
faster. It is placed further to the right of adjudication. Here the participation of the parties is
even higher since both adversaries can choose who is going to decide the issues under
dispute, where as in adjudication the decision maker is already appointed by the state. The
parties in conflict can sometimes identify the basis up on which their case will be decided
and whether the outcome will be binding or not.
Chapter four
The concept of Peace and peace building

4.1. Defining peace
The term peace is used in wide spheres. It seems that peace has a variety of meanings in
different contexts of usage. This is because of , peace itself is connected with various
aspects; religion, education, social factors etc For example, what peace is in religion may be
different from what it is in philosophy, politics, military, or history.
 Peace literally defined seems to be a tool or means to end war or conflict, or absence of war
or violence. However, Peace is not merely the absence of war, nor can it be reduced
solely to the maintenance of a balance of power between enemies. Even during the time
of no war, it does not mean people are at peace and society is peaceful, because problems
and hostilities may be still there. The reason why scholars are not satisfied with the
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absence of war is that they view peace as the presence of more other good things like
justice, order, good law, good government, good relationships, well-being, freedom, respect
for human rights, security, etc.
 From our daily experience in life and social existence, peace can also be described as a
state of mutual harmony between people or groups, especially in personal and group
relations.
 It is an agreement or treaty between individuals, antagonistic nations, groups, etc.,
to end hostilities and abstain from further fighting or antagonism.
 It is also defined as the normal freedom from civil turmoil and violence of a
community; public order and security and the freedom of the mind from annoyance,
distraction, an anxiety, an obsession, etc.; tranquility; serenity.
4.1. 1. Types of peace

peace is a multidimensional concept that can be viewed and discussed through v arious
types such as internal peace, external peace, positive and negative peace.
I. Internal peace: is also called as "inner peace" p e a c e w i t h i n o n e s e l f , or" peace

of mind or soul".
 It is a state of calm, and peacefulness of mind that arises due to having no suffering, or
mental disturbance such as worry, anxiety, greed, hatred, ill-will, delusion and other
debasements.
 Internal peace is essential; it is generally regarded as true peace and as a real foundation
of peace in society or peace in the world. It clearly shows that internal peace influences
other peace. For example, a worried and disillusioned person is always sensitive to fight
with others.
II. External peace: is peace that occurs in society, states, and the world.
 It is a normal state of society, countries and the world - a state of peaceful and
happy coexistence of people as well as nature.
 In its broader sense external peace includes a state of social harmony, social justice,
social equality, friendship, public order and security, and respect to human rights. As
such, external peace is the absence of all social evils as well as the presence of social
virtues.
III. Positive peace
 Positive peace is a true, lasting, and sustainable peace built on justice for all peoples. It
is the presence of the attitudes, institutions and structures that create and sustain
peaceful societies.
 It involves the elimination of the root causes of war, violence, and injustice and the
conscious attempt to build a society that reflects these commitments.
 Well-developed positive peace represents the capacity for a society to meet the needs
of citizens, reduce the number of grievances that arise and resolve remaining
disagreements without the use of violence.
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 Efforts to achieve positive peace emphasize: establishing peace by supporting non•
violent resolution of disputes, establishing social equality and justice, economic
equity, ecological balance; protecting citizens from attack, and meeting basic human
needs, establishing a civil peace that provides the constitutional and legal means
necessary to settle differences nonviolently , eliminating indirect violence, that
shortens the life span of people, sustains unequal life chances, or reduces quality of
life for any citizen ,practicing conflict resolution as a foundation for building
peaceful interpersonal relationships.
I. Negative peace
V
 Negative peace is defined as a peace without justice. It is a false sense of " peace" that
often comes at the cost of justice.
 Negative peace is the absence of direct violence or the fear of violence. In a negative
peace situation, it may not see conflict out in the open, but the tension is boiling just
beneath the surface because the conflict was never reconciled.
 Efforts to achieve negative peace emphasize: managing interpersonal and
organizational conflict in order to control, contain, and reduce actual and potential
violence, reducing the incidence of war by eliminating the extreme dangers of the
war system and limiting war through international crisis management, preventing
war through strategic deterrence and arms control.
 The concept of negative peace addresses immediate symptoms, the conditions of
war, and the use and effects of force and weapons. Words and images that reveal the
horror of war and its aftermath are often used by writers, artists, and citizen groups in
their efforts to stop it.
4.2. The concept of peace building
4.2.1. Introduction
Simply stopping fighting does not mean putting a permanent end to violence rather
persistent work to find creative solutions to conflict is needed to build sustainable peace. When
conflicts happened, the next step is how do resolve it and how to bring a long-lasting peace by
addressing the core problems so that societies will not return to destructive violence.
4.2.2. Defining peace building

 Peace building is a long-term process of ensuring peace through encouraging conflicting
parties to talk to each other and bringing them together to discuss the issues and understand
the views of others, and repairing their broken relationships.
 It focuses on the long-term support and establishment of viable political, socio- economic
and cultural institutions capable of addressing the root causes of conflict and creating the
necessary conditions for sustained peace and stability. Peace building strives to transform
the social institutions and the discourse that reproduce the culture of violence and
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structural violence through rebuilding fractured social bonds and alter people's expectations
of themselves and others.
 Peace building activities seeks to promote the integration of competing or alienated
groups within main stream society, through providing equitable access to political
decision-making, social networks, economic resources and information that can be
implemented in all phases of conflict.
 Successful peace building activities seek to create an environment that helps people to
resolve their differences peacefully and lay foundations to prevent future violence, to
create self- sustaining, and durable peace.
 It also reconciles opponents, prevents from restarting, creates rule of law mechanisms,
increases tolerance and promotes coexistence, protects human rights, improves socio-
economic development, reforms justice and security institutions, promotes a culture of
justice, truth and reconciliation, and addresses underlying structural and societal issues.
 Peace building is not a short term process. It focuses on long-term support and
establishment of, viable political and socio- economic and cultural institutions capable of
addressing the root causes of conflicts, as well as other initiatives aimed at creating the
necessary conditions for sustained peace and stability. Peace building occurs either before
violent conflict erupts (a preventative measure), or after violent conflict ends (an effort to
rebuild a more peaceful society). These activities also seek to promote the integration of
competing or alienated groups within mainstream society, through providing equitable
access to political decision-making, social networks, economic resources and information,
and can be implemented in all phases of conflict.
4.2.3. Dimensions of Peace Building

The are many ways categorizing the different dimensions or aspects of peace building
activities. Differing ways of presenting such dimensions are often linked to differing
assumptions relating to the basic causes and drivers of conflict. Nevertheless, the following
are identified as key dimensions of peace building activities:
 Security dimension: includes
 disarmament, demobilization and reintegration of ex-combatants
 improving control of small arms and light weapons,
 security and military measures,
 security sector reform, and law enforcement
 Governance and political dimension
 Preventing spoilers
 Strengthening intelligence apparatus
 Rebuilding or strengthening legitimate political process and institutions, governance,
 Promoting civil society, elections, combating corruption and judicial reform.
 Support for political and administrative authorities and structures
 Reconciliation and promotion of non-violent conflict resolution
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 Support for good governance, democracy and human rights
 Support for civil society and the media
 Legal action and truth commissions: balance between truth, justice, punishment,
reconciliation and impunity
 Social, economic and environmental dimension
 Reduce socio-economic differences and unequal distribution of benefits or
burdens as root causes of conflict
 Fairness in resource distribution, physical reconstruction, aid, and market uniform.
 Included marginalized and vulnerable populations and geographical regions
 Reduce competition for limited natural resources (e.g. land, water) and
environmental degradation
 Support control of exploitation and trade in valuable natural resources (e.g.
diamonds, oil, metals)
 Repatriation and reintegration of refugees and internally displaced persons
 Rebuild infrastructure ("quick impact projects")
 Support high-quality and accessible health and education services
 Stimulate productive sector development, employment, trade and
investment (legal and economic reforms, institutional and technical
cooperation)
 Psychological dimension: Addressing psychosocial conflict: includes trauma healing and
interpersonal and inter-communal reconciliation.
4.2.4. Actors of Peace Building

 Any successful peace building strategy inherently relies on a multi-stakeholders engagement
process with a wide variety of actors. Actors are may be groups, individuals, states, civil
society, Non-Governmental Organizations, community members International
organizations,, etc who directly or indirectly involved with conflict and contributing peace
building. These actors have different interests, motives, perceptions and adopted their own
mechanisms to bring sustainable and long-lasting peace. Their resources , power and
neutrality determine the success of peace building. Broadly actors of peace building can be
classified as ; top-level, middle-range and grassroots
 Top- level actors: are the main military, security and political leaders. These leaders are
usually highly publicly visible, and their actions may be sharply constrained by political
considerations. A number of regional and international actors have attempted to facilitate
negotiations between conflicting parties such as ruling governments and rebel forces.
Africa Union(AU) , United Nation(UN) , European Union(EU) and other organizations
are playing role for building peace.
 Middle range actors: are usually respected figures in business, education, religion,
community. These actors are generally have connections to people in both the top and the
grassroots level. extended Civil wars has been eliminated much of the middle-range
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actors, as warring parties have attempted to their control within their territories. Middle -
range peace building attempts have focused largely on arranging meetings between
religious leaders, community elders , and other stakeholders from opposing sides deal
with and try to find possible solutions to their problems with the support of top-level
actors.
 Grassroots actors: are primarily parties directly involved in the conflict, traditional and
local authorities, and community elders and religious leaders, women and youth. These
leaders often have a critical role in resolving the conflict formally and informally
because these actors are directly affected by the occurrence of the conflict and their role
in peace building process is immediate need to survive. And also they have played a
great role in organizing the community and religious followers for ending the conflict
and promoting peace or aggravating the conflict. The participation of those who are
directly or indirectly involved in a conflict situation are critical to peace building efforts
because of these are the key deciders for the fruitfulness of peace building activities. If
any peace building process ignores them , the process may lacks legitimacy, which in
turn aggravated the conflict.
4.2.5. Principles of Peace Building
 For a successful peace building activities are governed through the following principles:
 Commitment and flexibility: Peace building is strategic and requires long-term
commitment and flexibility. It cultivates imagination where immediate reactive tendencies
are prevalent. It leads protagonists to look beyond their problems and see a future.
 Integrity: use a comprehensive approach that focuses on grassroots while strategically
engaging actors at middle-range and top levels of leadership and includes advocacy at
local, national and global levels to transform unjust structures and systems
 Participatory: to involve people not merely as beneficiaries but as active participants.
There are many different actors, instruments, and systems that affect the peace of a
relationship, community and society. Bringing all actors on-board and planning with the
whole picture in mind is critical
 Holistic: to address the full range of peace and conflict issues, the long-term causes as well as
the immediate symptoms and achieve right-relationships that should be integrated into
all programming.
 Inclusiveness and diversity: to engage and benefit the whole of society, since limiting the
engagement and benefits to only some people or actors will entrench the conflict problems
and driven by community-defined needs and involves as many stakeholders as possible.
Respect for the dignity of any and every person irrespective of sexual, religious, or cultural
orientation is the bedrock of human relationships. Peace building is about demonstrating
reverence and appreciation for our common humanity and living with our differences
 Sustainability: the process of building peace is supported for as long as is necessary, rather
than being subject to arbitrary political or bureaucratic timetables;
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 Knowledge-based : because peace building has much greater prospects of success if it is
based on research and strengthened by continuing monitoring and assessment.
 Simplicity: keeping the process simple. Conflicts already lead to confusion and
bewilderment. Helping the parties to respond gradually in a less complicated fashion removes
the fear that conflicts, especially intractable conflicts, are insurmountable
 Collaboration: Peace building is about complementarily and not about duplication;
about collaboration and not about competition. The strategy focuses on mobilizing actors to
clearly delineate their roles, responsibilities, strengths and limitations and evolve a coordinated
and harmonized response to any conflict and process of change
Chapter five
Indigenous Conflict Resolution Mechanisms: Essence, Features and

Limitations
5.1 Introduction
Different societies of the world have developed their own mechanisms to resolve conflicts based
on their historical , traditional and cultural landscapes. Like in other parts of the world Africa,
have developed their own indigenous institutions. However, the mechanisms are different from a
given society to the others because of the difference in culture, tradition and custom.
5.2. Defining indigenous conflict resolution mechanism
 Indigenous conflict resolution mechanisms are grass roots and community-based

mechanisms of solving conflicts arising within or between individuals, groups and
communities according to their customary set of practices that are present in all
communities.
 They are age-long and ancient set of practices and part of social systems which play
important role in the reconciliation, maintenance and improvement of societal
relationships. The mechanisms are deep-rooted and contained in the custom, culture and
traditions of the society.
 Indigenous conflict resolution mechanism is a social capital that implies the ability of social
norms and customs to grasp members of a group together by effectively setting and making
possible the terms of their relationship, sustainability facilitates collective action for
achieving mutually beneficial ends.
5. 2 Main Features/advantages of indigenous conflict resolution mechanisms
Although indigenous conflict resolution mechanisms vary considerably from society to society,
from region to region, from community to community and from society to society, there are
certain features that indigenous institutions share in common. These are:
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 Context specific: one of the features of indigenous conflict resolution mechanisms is
that each indigenous institution has its own distinct structure of resolution which dictates
how various forms of conflict should be resolved.
 Since there are different societies and communities with a specific history, a specific
culture and specific custom.
 There is no one single and general principle and procedure of "indigenous conflict
resolution mechanisms". Rather, indigenous conflict resolution approaches are always
context specific.
 Voluntary and consensual proceedings: indigenous conflict resolution mechanisms
generally require voluntary participation of both conflicting parties and reaching agreement
to abide by the outcomes.
 Indigenous institutions do not have the kind of coercive mechanism as does the formal or
modem system, and rely on social pressure and exclusion from the community to deal with
non• compliance.
 Locally circumscribed constituency: indigenous conflict resolution institutions
operate locally, that is, they resolve conflicts within particular group and often within
specifically circumscribed geographic locations, often within a community of people who
know each other and live within close proximity.
 However, in few cases there exist institutions that cut across boundaries and have the
capacity to resolve inter-ethnic and inter-clan conflicts.
 Accepted and flexible norms, rules and values: indigenous conflict resolution mechanisms
generally deliver justice in accordance with norms, rules and values that are generally
known and accepted by societies. However, the rules and evidences are often flexible and
can be adapted to particular cases and circumstances.
 Group-based responsibility: indigenous conflict resolution mechanisms often consider that
responsibility for the harm rests, not with the individual but with the broader social
grouping, often the family or clan.
 The family or community members of the offender are involved in ensuring that the
offender among their midst complies with the verdict and where compensation is required
may be expected to contribute.
 Negotiation and compromise: indigenous conflict resolution mechanisms generally
involve negotiation between the conflicting parties to try and resolve the case amicably.
 This usually involves both parties accepting some measure of responsibility for the dispute
and agreeing to the decision. Rather than one party being viewed as the winner and the
other as the loser, both parties stand to benefit from reconciliation.
 Dynamism and responsiveness to change: indigenous conflict resolution
mechanisms are not static but evolve over generations to their current status, and can
respond to changes in views and values.
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 Many have evolved in recent times and changed over the past periods to become more
formalized in response to interactions with the formal systems and regional, national or
international pressures.
 Restoration and maintenance of peaceful co-existence: indigenous conflict resolution
mechanisms aim to restore peace and harmony between the conflicting party
members, neighbors, clans or local groups so that the former accuser can continue to live
together in frequent interaction.
 Forgiveness and compensation: indigenous conflict resolution institutions often require
the loser or wrong doer to ask forgiveness and/ or pay compensation, rather than imposing
physical punishment or imprisonment.
 Compensation is often paid by one individual, family or clan to another in the form of
restorative penalty that enables parties to be reconciled.
 Public participation: indigenous conflict resolution mechanisms are usually held in
public and often allow participation by those attending it.
 Rather than being imposed, the outcome is negotiated and discussions may continue till the
decision is agreed upon by all present.
 The outcome needs to be consequential and requires public approval to enable decisions to
be backed by community sanctions of exclusion if required.
5.3. Actors in Indigenous Conflict Resolution Mechanisms
 Indigenous conflict resolution mechanisms involve various actors in the conflict resolution
process. The actors who participated in the conflict resolution process may vary from society
to society. In some societies religious leaders may be the one of the actors in the process. In
other communities clan leaders may take part in the process. Generally the actors participated
in indigenous conflict resolution process can be classified as :
 Conflicting parties(accuser and accused): they are the main actors or participants in the
resolution process because, the existence of the system depends on the presence of
conflicting parties, who bring their cases in search of justice. If conflicting parties were
not there , it would not be possible to have the system of indigenous conflict resolution.
The disputants familiarities with the system, their trust on elders or religious leaders, time
and cost effectiveness of the system are some of the reasons behind the local people's
persistence of the system. Participants in the indigenous resolution process may be
relatives, friends, neighbors and clan members of conflicting parties, religious leaders, and
any passerby can also attain. In most cases these participants may have the right to
participate in discussing the case. However, they do not have a role in decision-making.
 Mediators: the main actors in the indigenous conflict resolution activities are elders, clan
heads, religious leaders , respected persons, etc. It is crucial for a mediator to be trusted by
the parties to a conflict, and in order to achieve that, the mediators must be an upright and
honorable person, who shows will and determination to help the conflicting parties. In this
regard, mediators are selected based on their good reputation, wisdom, exemplary deed,
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status, experiences, patience, commitment, talent, skill and knowledge in delivering just
decisions, well versed in traditional rules and other calibers. In many community elders
who are respected and accepted in their community by their wisdom, experience, moral
standard, knowledge of the custom of community, their ability to analyze and advise
disputants, and being character of patient are selected as a mediator.
 The crowed : the crowed consists of any interested person or sympathizer of disputants.
5.4. Weaknesses of Traditional Approaches
The major strengths of traditional approaches to conflict transformation are:
 Traditional conflict transformation does not necessarily put an end to violence in the long
term:
 In a traditional context, recourse to violence – violent self-help – is a ‗normal‘ option. Every
peace deal that has been achieved is under the proviso that it might be revoked in the near or
distant future. A permanent pacification of the conduct of conflicts as it is given
(theoretically at least) in the context of the modern state with its monopoly over the
legitimate use of violence is not achievable in the traditional context. Moreover, certain
highly ritualized and thus controlled forms of violence are perceived not as violation of the
rules, but as integral to the societal order and as indispensable elements of conflict resolution.
Fighting can be a means of constituting and re-establishing harmony. Furthermore, violence
permeates the everyday life. Violence against weak members of the community, in particular
domestic violence against women and children, is a ‗normal‘ feature of ‗peaceful‘ life in
many traditional communities (as it is, one might add, in modern state societies) and for re-
framing the context of the conflict.
 Traditional approaches may contradict universal standards of human rights and
democracy:
 If councils of elders for instance broker peace deals between conflict parties and if these
councils actually consist of old men only, this type of gerontocratic rule is problematic by
modern democratic standards, all the more so if the young and the women who are excluded
from decision-making processes become the subjects of these decisions.
 Women often are the victims of customary conflict resolution processes that are dominated
by males in order to resolve conflicts between males, e.g. swapping of women between
conflict parties or gift of girls as compensation, or compensation negotiated by male
community leaders and exchanged between males for the rape of women or girls.
Furthermore, the treatment of perpetrators according to customary rules can contradict
universal human rights standards, e.g. by a violation of personal integrity or even torture.
 These problematic features of traditional approaches may themselves lead to conflicts.
Young women and men – ‗infected‘ by modern ideas from the outside world – often are
no longer willing to subordinate themselves to gerontocratic rule. Of course, the severity
of this problem depends on the specific circumstances in the given community: In
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communities where young men and women also have a say in community affairs or where
custom is adaptable, the situation is more relaxed than in rigidly authoritarian or
gerontocratic circumstances.
 Traditional approaches have a limited sphere of applicability:
 They are confined to the relatively small community context, to the ―we‖-group of
family, clan, village or neighboring communities. This problem can be addressed to a
certain extent by re-framing of the ―we‖-group. Boundaries of groups are not fixed, but
can be changed. However, inclusion of certain far-away external actors such as
multinational enterprises, central state authorities and mercenaries will probably pose
grave difficulties (although this would have to be tested on a case-by-case basis), all the
more so as traditional approaches in such situations clash with modern external (and
more powerful) systems of conflict regulation.
 Another problematic group of actors consists of those members of the community who
willingly or unwillingly have left the community, live in a modern environment and only
have relatively loose ties to their places of origin. New types of leaders (warlords,
businessmen, politicians) are a case in point, as are young members of the community
who left their village in order to make their fortune elsewhere, mostly in the cities (and
who only too often fail desperately). The problem becomes particularly evident with
regard to young male ex-combatants in post-conflict situations. Often they are so deeply
alienated from their communities of origin that it is almost impossible to re-integrate
them into traditional life by customary means.
 To put the problem in more general terms: wherever traditional societal structures and
custom have been severely undermined by the impact of the modernizing powers of
capitalism such as urbanization, privatisation and monetarisation it will be difficult or even
impossible to apply traditional approaches to conflict transformation. However, even under
such conditions it is worthwhile to look closely at the specific conditions of the given place
and conflict. For example, it would be short-sighted to simply conclude that urbanization
automatically leads to the breakdown of traditional structures. Often people still have very
close ties to their places of origin or they transfer the ‗village‘ and its values and rules to the
new urban environment.
 Traditional approaches are preservative:
 They are geared towards the preservation of the status quo or the restoration of the
‗good old‘ order. Disturbances of that order have to be controlled and fixed.
Traditional approaches only work in the framework of that order and are only
applicable to conflicts that occur within a given community.
 Traditional approaches are difficult to apply with regard to conflicts against the
community, conflicts that challenge the framework of values and relations of the
traditional order. The conservative character of traditional approaches does not sit
well with modernizing influences from either within the community – young men and
women challenging traditional authorities and the ‗good old ways‘ – or from outside
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the community – western external actors intervening in the name of modern values
and interests such as profit, taxes, statutory law and human rights.
 Given these pressures from within and without, traditional approaches will have to
adapt, and combinations of traditional and modern institutions and instruments of
conflict transformation will have to be developed. Although traditional societies are
generally characterized by a relatively slow pace of change, experience shows that
custom is adaptable indeed and that positive mutual accommodation of traditional and
modern approaches can be successfully achieved.
 Traditional approaches are open to abuse:
 There are many examples of traditional authorities abusing their powers for their own
benefit and to the detriment of the weak members of traditional communities.
 Misconduct commenced in colonial times when traditional authorities became
instrumentalized by the colonial masters. This tendency continued in the post-colonial
era, and it also is effective today under conditions of weak or failed statehood. Biased
approaches on the part of elders, chiefs, etc. that are sometimes merely motivated by
personal greed nowadays are often legitimized with reference to custom. Status and
prestige stemming from the traditional context is instrumentalised to gain personal
advantages.
 With regard to Africa, for example, the relevance and applicability of traditional
strategies have been greatly disenabled by the politicization, corruption and abuse of
traditional structures, especially traditional rulership, which have steadily delegitimized
conflict management built around them in the eyes of many and reduced confidence in
their efficacy. The co-optation of traditional rulers as agents of the state, and their
manipulation to serve partisan ends, which dates back to colonial times, not to mention
the corruption of modern traditional rulers, have considerably reduced the reverence and
respect commanded by this institution and, therefore, the ability of traditional rulers to
resolve conflicts.
 Whenever the modern roles of politician, entrepreneur or warlord on the one hand and
traditional roles of elders or chiefs or big men on the other are united in one and the
same person, a perversion of custom is imminent. This of course weakens the legitimacy
of traditional authorities and discredits traditional approaches in the eyes of community
members, and as a consequence traditional approaches are weakened in general. And in
situations in which traditional approaches no longer function and modern state-based or
civil society approaches do not function either, unregulated and uncontrolled forms of
violence thrive.
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COURSE 5: INTERNATIONAL RELATION AND
ORGANIZATION
Chapter One
Basic Concepts, Evolution and Actors of International Relations
1.1. Understanding IR
A. What constitutes the field of IR?
International Relations impacts our day to day lives: from the price we pay for shopping, to the
laws governments legislate
Different scholars consider various issues and identify various actors that play roles in the
International system. Hence, different scholars define the term in different ways.IR is a discipline
that studies the interactions between and among states and also and other actors; and more
broadly the workings of the International system as a whole.
It is a multidisciplinary subject. It gathers together the international aspects of politics,

economics, history, geography, law, sociology and many others.
B. List of definitions for IR
 “IR is the relations between and among states”

By ‗states‘ we are referring to the interactions of state who are sovereign, territorially bounded
political units.
This is a narrow definition. It limits and identifies the subject matter clearly. However, it
excludes many important issues like actors of IR. Taking a brief glance at the world around us
we find that some of the principal actors in world politics, the agents of IR that make up the
political landscape of our subject area are not nations at all; we see GOs like UN or IMF
interacting with states; Regional Organizations like EU or AU; Important NGOs like the Red
Cross and Amnesty International.
 “IR is the study of who gets what, when and how in matters external to states or in
matters crossing international boundary lines.” Hunderson (1998)
This definition is state centric and the terms in the definition have the following meanings:
 Who: actors of the IR

 primarily focuses on States in IR; but it also recognizes non-state
actors like NGOs, IGOs and Churches
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 What: the goals of the states
 the goals can be political, ideological, cultural, economic or social
 When: the time dimension of actors (the continuous endeavor of states to
serve national interest. NI is not a one time interest; it is a continuous
strives)
 How: the means or instruments that actors use to serve a national interest.
 The means can be: military, diplomacy, economic and propaganda
 “IR is concerned with the study of the nature, conduct and influence upon relations
among individuals or groups operating in a particular arena within the framework
of anarchy”
Here a definition is made to IR in comparison with domestic system; it is argued that the
international system is basically anarchic in nature. In IR anarchic is chosen to describe world
relations because there is no world government which possesses authoritative law making,
interpreting and enforcing power.
 Why is it the international system assumed to be anarchic?

There is no central government each state is sovereign and autonomous, responsible for
their own fate (though they may not be fully able to control it) states exercise legitimate
control and authority over their own territory and answer to no higher power.
There is no international government that maintains international peace and security.
 There is no single legislator in IR. Rather a coalition of states‘, has absolute

control over the entire system.
In the domestic system, there is an authority called government that makes

the laws, enforces the laws and settles disputes. But in the international
system, there is no international government or legislature that makes laws
applicable to all states. Rather states have to consent to the international
laws individually either by entering into treaties with other states or by
creating customs through their behavior. The General Assembly of UN is
composed of delegates from all the member states, but its resolutions are
not legally binding.
 There is no „world court‟ with a binding power

There are many international tribunals, like ICC, ICJ and the like; but
none of them has compulsory jurisdiction to decide on the rights and
duties of states. Rather states must first consent to the jurisdiction of an
international court before the court can make a decision about those states‘
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rights and duties. There is no independent institution able to determine the
issue and give a final decision.
The ICC lacks universal territorial jurisdiction, and may only investigate
and prosecute crimes committed within member states, crimes committed
by nationals of member states, or crimes in situations referred to the Court
by the UN Security Council. The ICJ can only decide cases when both
sides agree and it cannot ensure that its decisions are complied with.
 There is no worldwide entity with an „executive power‟

There is no international government with the authority to command states.
– The Security Council of UN is effectively constrained by the veto power

of the five permanent members.
Thus, comparing the international system with the domestic one, the international affairs
can be seen as a series of bargaining interaction in which states use power capabilities as
leverage to influence the outcome. Henderson (1998) argues that the line between
domestic and international relations has blurred, bringing the two kinds of relations closer
together. Scholars supporting this, claim that the International system is not nearly as
anarchic as some might suppose. The absence of a world government does not
necessarily lead to disorder and violence. This is because states frequently choose to
avoid war; hence, they follow the norms and rules of International law. Sometimes
ironically the anarchic domestic systems are settled by the involvement of UN.
 “The study of IR describes all aspects of relations between states. Political or non-
political, peaceful or war like, legal or cultural, economic or geographic, official or
non-official.”
This a broad definition in terms of scope. It points out that IR involves not only political but also
non-political issues like economic social and cultural. It indicates that the relations between
states are characterized by peaceful and non-peaceful.
Conflict, Competition and Cooperation are the normal behavior of IR. They are non-avoidable
 “IR encompasses all kinds of relations crossing state boundaries, no matter whether
they are economic, legal, and political or any other nature, private or official. It also
includes all human behavior originating on all side of state boundary, and affecting
human behavior on the other side of state boundary.”
This is a very broad definition; it is relatively inclusive. It includes cultural and social type of
relations that crosses boundary such as athletics and the activities of non-state actors like that of
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Amnesty International. It claims that IR is a social sciences which considers the world people as
a whole.
 “IR refers to the relations among the world‟s state governments and the connection
of those relations with other actors (like the UN, MNCs, Individuals) and with other
social relationships (including economics, culture and domestic politics) and with
geographic and historical influence.”
This definition goes beyond the relations between and among sates and encompasses the
relations of states‘ with non-state actors on different global issues. It also recognizes the
interplay between domestic and international affairs. IR is affected by the domestic conditions
and vice versa. The external affair is the reflection of domestic situations in states.
 In general:
• IR refers to the study of the nature, conduct and influence upon relations among
groups and individuals that transit national boundary, concerned with aspects of
economic, political, legal, social and cultural.
• It is the sum total of the transactions, interactions, and exchanges among states
and others actors, in the economic, social, cultural and political spheres.
• It is related to a number of other academic disciplines, including political
science, geography, history, economics, Law, sociology, psychology.
– it also touches on diplomacy, diplomatic history, international law,
international political economic, international finance and economies ,
communications, globalization, ecological sustainability etc.
C. IR VS other concepts like International politics, International Law and World History
I. IR VS International Politics (IP)
IR and IP are often used interchangeably; but they are not the same things. There is a slight
distinction between them. IP is narrower in scope than IR. IP is concerned with political relations
(official actions and reaction among governments acting on behalf of their states). IR may
include all aspects of relations (political and non-political like trade, telecommunications,
transport, culture, tourism, environment etc.)
II. IR VS International Law (IL)
IL is concerned with the legal aspects of inter sate relations. IR goes beyond legal aspects. For
example, Students of IR do not stop merely studying the legality of Russia vs. Ukraine dispute
but go beyond and study: the factors that influenced Russia‘s and Ukraine‘s policies in this
respect. Their state of preparedness for conflict, sources of the benefits for the principal policy
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makers in Russia and Ukraine, regarding whether or not there would be any limited or prolonged
war fare between them on this issue. And the extent of the domestic pressure on their policies.
IL on the other hand focuses on the legality of the actions taken by both states in the affairs.
III. IR VS World History
IR is wider than world history and current event. historians study the past developments and their
causes and effects, IR does not only study what happened in the past, It also tries to evaluate and
analyze what is happening at the present; and does so from a wider angle. Additionally it also
tries to predict the future.
D. Why study IR?
IR is a reality; there are interactions between and among the separate societies of the world;
sovereign states interact with each other intensely and on a huge variety of matters.
The economic security of states, and the need for the physical safety of states make IR a
necessity. And technological developments of the 20th c have made it possible for some states to
do harm to others)
IR is concerned with issues which have a significant and maybe crucial impact on people‘s lives.
We live in a world with scarce resources; no state in the world is fully self-sufficient. A state
cannot produce all goods, services and protection which their society demands and expect
without the assistance of other states. Even the richest states have limited amount of natural
resources, manufactured goods, money and jobs that can be shared by the population. Scarcity is
the driving force for states to interact with each other. States enter into relations with others to
satisfy the demands of its society.
There are series of border transcending problems like international conflicts, civil war, the
proliferation of weapons of mass destruction, widespread of human rights abuses, poverty,
environmental degradation, HIV, terrorism, Covid etc. a single state cannot solve these
problems. These problems are borer transcending; they are not limited to national borders. Thus
to solve them, states need to cooperate with each other. There are also positive trends and events
that give rise to interdependence between and among the people of the world like: the end of
cold war, the spread of democracy, the advancement of international trade and economic
cooperation, the extraordinary achievements of science and technology, development of
widening cultural correlations among people of the world. Additionally, the internet and the web
led to the rapid growth of international economic cultural and political linkage. International
travel for business, tourism and other purposes increased significantly contributing to closer
connections among the people of the word.
Interdependence between states has two dimensions:
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I. Sensitivity: the degree to which states are sensitive to changes taking place in another
state.
II. Vulnerability: the distribution of costs incurred as states react to such changes
Two states may be equally sensitive to changes but they may not be equally vulnerable to it. For
example, all states may equally be sensitive to oil price increase; but they may not be equally
vulnerable as a result of it. The oil price increase as a result of the Russian vs Ukraine war has
equally made both Ethiopia and Germany sensitive to the price change. But the level of
sensitivity that the two states face as a result of the price increase is totally different. In Ethiopia,
the price increase in gas has intensified the inflation; in German it is not felt as much.
The degree of interdependence vary from state to state. Some states are highly dependent on
others.
1.2. Evolution and Growth of IR
A. The Practice of IR
History of IR is often traced back to the history of the establishment of separate society. IR is as
old as the state itself. As an academic field of study, its origin is very young. The practice of IR
has passed various stages of development: Ancient, Middle, Modern and Contemporary.
I. Ancient
History of IR between independent states traces back to 4000 years during the Mesopotamia
periods. 2100BC, a solemn treaty was signed between the rulers of Lagash and Umma (city
states located in the area known as Mesopotamia): the agreement was about establishing a
defined boundary to be respected in both sides.
Chou dynasty in china (1122BC-221BC): during this time, china had diplomatic, trade and
commercial interactions among the different units in china. It was also a formal form of
subversion and interaction in other states‘ internal affairs as methods of achieving their
objectives.
Greek city states around 400BC: the city states were carrying out sophisticated trade relations
and warfare with each other in a broad swath of the world from the Mediterranean through India
to East Asia. Diplomacy has been practiced since the first city sates were formed millennia ago.
The Arab Empire (600AD-1200AD) played asocial role in the IR of the Middle East
Ethiopia has had extensive diplomatic and commercial contacts during the Axumite period (700-
800AD) with other states. Adulis used to be the thriving spot for international trade, making it
one of the leading harbors of the world back then.
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II. The Middle Ages
IR in the middle ages was dominated by the Roman Empire. Modern diplomacy is traced back to
the states of Northern Italy in the earl Renaissance period. The first embassies were established
in the 13th C. the practice of presenting ambassadors‘ credentials to the head of state started out
in Italy and spread to the other European powers. In 1455 Milan sent a representative to the
court of France.
By 16th C, permanent missions became customary.
III. Modern Period
Roughly since the 17th C on wards the modern IR history began. This period is associated with
the development of the territorial sovereign state. Modern history of IR is often traced back to
the Peace of Westphalia of 1648. This was a treaty that ended the thirty years war and
recognized the independence of many European states from the Holy Roman Empire and the
Roman Catholic dynasty. This treaty instituted the legal concept of sovereignty-meaning the
sovereign had no internal equals and no external superiors)
Sovereignty is believed to be a key to understanding IR. Sovereign state in a loose term can be
understood as a territorially defined political society that is recognized as being solely
responsible for the governance of that territory and, on the international stage as independent
from any political or religious superior. Sovereignty is a political doctrine that captures the ideas
of freedom, independence and self-determination that are the primary claims of existing states
and the major aspiration of many subnational, cultural, ethnic and religious groups who are
subsumed in the territory of existing states.
Basic characteristics in the post-Westphalia system:
• States became the primary actors in the international system-this has continued to the
present day
• The domination and shaping of the international system by the west (Britain, France and
other European states advanced to take control of the North and south America, Asia and
Africa)
• Multi- polar system reached its zenith.

• The establishment of the concept of popular sovereignty marked a major change in the
notion of who owned the state and how it should be governed. The divine right of kings
in 1700s and 1800s gave way to the idea that political power comes from the people.
IV. Contemporary
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The contemporary International system was consolidated through decolonization during the Cold
War (CW). CW was the state of conflict, tension and competition that existed between the US
and USSR; and their respective allies from the mid1940s- early 1990s.
CW was an intense struggle for power between the superpowers. There was tension, armed
conflict, and a zero sum relationship between the superpowers-hence the term war. The term cold
refers to the presence of factors that allegedly restrained the confrontations and prevented a hot
war.
In this period the rivalry between the two superpowers was expressed through military coalitions,
propaganda, espionage, weapons development, industrial advances and competitive
technological development. Both powers spent a lot on defense, conventional and nuclear arms
race and proxy wars.
US ad USSR were allied against the Axis Powers during the WWII, but the two sharply
disagreed sharply after the war on many topics particular over the shape of the postwar world.
The war left the two states as the two super powers-bipolar world. Other states were prompted to
align themselves with one or the other for the super power blocs. Following this in the 1960s a
Non-Alignment Movement has also emerged.
CW witnessed both periods of heightened tension and relative calm. Wars like the Korean war
(1950-53), the Vietnam war (1959-75) the soviet war in Afghanistan (1979-89); and other events
like the Berlin Blockade (1948-49), Berlin Crisis of 1961, and the Cuban Missile Crisis raised
fears of a Third World War.
There were also periods of reduced tension as both sides sought detente. Direct military attacks
on adversaries were deterred by the potential for the mutual assured destruction using deliverable
nuclear weapons.
The CW drew to a close in the late 1980s and early 1990s with the coming to power of Ronald
Regan US increased diplomatic, military and economic pressure on the USSR. By then USSR
was already suffering from severe economic stagnation. USSR‘s leader Mikhail Gorbachev
introduced agenda for economic reform (perestroika) which increased freedom of the press and
the transparency of state institutions. USSR collapsed in 1991.US became the sole super power
in the new unipolar world.
• Characteristics of the Contemporary period:

I. WWI-WWII
• The outbreak of the WWI changed the pre 1914 principal issues
• Versailles Treaty served as spring board for the creation of the first universal
international organization the LON.- a new IR actor
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• Characterized by multipolar system at the early period; major powers formed
allies.
II. Post WWII – End of CW Period
• There were as series of changes in the system
• The structure changed from multipolar to bipolar

• East west axis were established (NATO in 1949andWaRSOpactin 1955)
• New states emerged due to decolonization process

• New issues like HR and Environment started being given emphasis
B. IR as a Field of Study
Aspects of IR have been studied as early as the time of ancient Greek historian Thucyddides. IR
attained the first academic position only after WWI. However, as a separate and definable
discipline, IR dates from the early 20th c. when the first organized efforts were made to find
alternatives to war in nation-state international behavior.
1919, the department of International politics was established at the university of wales.
The study of IR grew out of the belief that wars were the greatest problem that humanity faced
and that something must be done to ensure that there could no more be devastating war.
 Two schools of thought quickly developed.
1. The first school of thought aimed to strengthen IL and IOs to preserve international
peace (this is known as a normative position in line with the assumptions of
idealism)
– The study of IR has always been heavily influenced by normative

considerations like the goal of reducing armed conflict and increasing
international cooperation.
2. The second school of thought was of the assumption that nations will always use their
power to achieve goals and thus the key to peace is a balance of power among
competing states. This is known as realism. It stressed seeing the world as it really
is, rather than how we would like it to be.
Basically IR theories can be classified into two epistemological camps:
I. Positivist theories: aim to replicate the methods of the natural sciences by analyzing the
impacts of material forces they focus on features of IR like state interactions, size of
military forces, balance of powers etc.
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– Positivist theories (realism/neo-realism) offer causal explanations (why and how
power is exercised. Positive theories make a distinction between facts and
normative judgments or values.
II. Post positivists: reject the idea that the social world can be studied in an objective and
value freeway. It rejects the central ideas of neoliberalism/liberalism, such as rational
choice theory, on the grounds that the scientific method cannot be allied to the social
world and that a ‗science‘ of IR is impossible.
Post positivist theories focus on constitutive questions like what is meant by power, what
makes it up, how it is experienced and how it is reproduced. These theories explicitly
promote a normative approach to IR by considering ethics.
The assumption that war could be prevented was short lived as the world dove into WWII, in
the after math of WWII, there were renewed efforts to organize the peace with the birth of
another IO- the United Nations (UN) - replacing the League Of Nations (LON).
After WWII, by the initiative of UNESCO, there was conference of all university
representatives with the aim to motivate universities to establish the department of IR. Later
the subject began to expand to states of Africa, Asia and Latin America. In Ethiopia the
department of Political Science and IR was founded when AAU was established in the
1950s.
1.3. Actors in IR
1.3.1. Actor: Definition
Actors are set of organized entities capable of taking independent decisions and actions at the
international level that influence the behavior of other actors in the international arena.
A political actor is an individual or a group that seeks to achieve goals by either conflicting or
cooperating with others in a policy context.
 Who are the actors in IR?

Actors in IR are the sovereign states. IR scholars study the decisions and acts of
sovereign states in relation to other sovereign states. But in reality, the international stage
is crowded with actors large and small who are intimately/closely interwoven/interlinked
with the decisions of states. Old and new actors strongly undertake roles alongside the
state on the international stage.
Basically we have three sets of actors in IR: States actors, Sub-state actors, and Non-state
actors
A. The State, as an actor in IR
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 What is a state?
1933 Montevideo convention on the Rights and Duties of states laid certain criteria of states.
Article 1 provides that the state should possess the following qualifications:
1) permanent population
2) defined territory
3) A government and
4) A capacity to enter into relations with other states (recognition).
 State and Government, are they the same thing?
The two terms are used interchangeably but they are not the same. A state is an abstract and
symbolic concept while a government is a concrete and tangible one. A state cannot conclude
treaty, enact, interpret or enforce laws by itself; in the name of the state, it is the concrete body
(government) that makes and enforces laws. State is more comprehensive than government.
Government is one element of state (State encompasses all the four elements including
government but government is just an element of the state).
State is relatively static, it stays for longer periods of time compared to governments.
Government is dynamic, volatile and changeable in its forms and orientations.
States are said to be the main actors in IR as it is sovereign states who set rules for economic
interaction, communication, technologies, political and diplomatic relationships as well as rules
for foreign policy. States are actors in the formal diplomatic and legal network of relationship.
As a state is an abstract entity, Government of a state formally acts on behalf of state. The
government makes decisions, formulates policies and reacts to the decisions and policies of other
governments.
State is a strong actor in the performance of important political functions. Some of its functions
include: maintaining territorial integrity of the state, promoting economic development,
providing for national security, protecting national prestige, maintaining world order,
establishing order peace and stability, organizing and mobilizing members of the society towards
the common values; and defending interests and values of societies form any external threat
 What is sovereignty?
Recognition is related to sovereignty: Sovereignty can be internal or external.
Internal sovereignty indicates that the state has the final authority within its defined territory
over individuals, citizens and others. The state is the only ultimate power holder legitimate for
the control and administration of the territory, population and its objects.
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External sovereignty: the power and ability of the state to conduct foreign relations and the
freedom from subjection to or control by outside state. It is the recognition in international law
that a state has jurisdiction over its territory and populations. External sovereignty is the most
important thing in IR. The state is independent or at least theoretically, we are talking about the
‗equality of a state‘ with other states. It signifies that all states are equal in the international
system regardless of their differences in different aspects like economic development, military
power and so on. No one state has the right to give order to other state.
Sovereign states are equal, and sovereign equality is the basis upon which the UN operates. This
principle is what guarantees equal participation by all states in IR. Sovereign equality has the
following elements as a content:
• all states are legally equal

• every state enjoys the rights inherent in full sovereignty
• every state is obligated to respect the fact of the legal entity of other states
• the territorial integrity and political independence of a state are inviolable
• each state has the right to freely choose and develop its own political
,social, economic and cultural systems
• each state is obligated to carry out its international obligations fully and
conscientiously and to live in peace and with other states.
Sovereignty is not entirely absolute. States can have international obligation to respect
international norms and conventions. They accrue these obligations when they enter into
international treaties and agreements. Of course states are free not to enter into these agreements
to begin with, but once they do, they relinquish a certain measure of sovereignty to the
international community
 Are all states practically equal?

Legally speaking all states are equal. All states are sovereign and independent. But in reality due
to various factors, states are not actually equal. Based on their degree of influence in the
international stage there is hierarchy of states. This is because states reflect much diversity in
their major characteristics. Some of the causes that create diversity among states include:
– Military Power:
• high military power (superpower states) vs. low military powers
– EG: Comoros (1955 a handful mercenaries took over Comoros, taking
the president a prisoner; stayed in charge of the 500,000 population
until French Soldiers charitably came to the rescue.)
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– Ideological difference:
• secular vs. non-secular; capitalist vs. socialist vs. Developmental state
– Economic Status:
• World economy is dominated by a few states.
– US alone accounts for 1/5th of the world economy; together with six
other great powers it accounts for more than half. A few of these large
states possess economic strength and influence world politics. The
richer states play crucial role in IR
– Population Size:
• Both the quality and quantity of the population is important in IR.
– But the quality of the people is more crucial (rate of literacy, know
how etc.)
– Territorial Size and Location of the State:

• Territorial size is important in IR. Large size is important for defense.
– Rough States:
• These are States that regularly violate international standards of acceptable
behavior. They are States that are inimical to the norms and the rules of
international society.
• This is when a state is considered to be a threat to international peace, highly

repressive, xenophobic and arrogant and which has no regard for the norms of
international society. It is the leadership that is roughened not the general
populace; however, it is the people who ultimately pay the price when the
international community takes collective action against the rouge state.
• There is no general agreement as to who is a rough state and who is not. A
state considered as a rough state by one state might not be considered as such
by another. For example, in the eyes of USA, Iran and North Korea are rough
states; in the eyes of Arab states, Israel is a rough state.
In general, States with large population, large, economies or military capacities play important
roles in international affairs. Small and weaker states are also important but taken singly most of
them do not affect the outcomes of IR nearly as much as the major states do.
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Until 1920s states continued to be the dominant actors in IR. This was because during this
period, the success or failure of states in pursuit of their national interest was mainly determined
by how they could manipulate the support of one country or another.
 What changed after 1920s?
– Bitter world experiences,

– technological advancements, expansion of communication, and ever increasing
economic interdependence,
– The number of actors in IR has increased tremendously. Varying actors with varying
interests and purpose came about.
The proliferation of non-state actors has led some observations to conclude that the states are of
declining importance and that non-state actors are gaining in status and influence. For example,
MNCs are ushering in a world economy; Mangers of the corporate giants make daily business
decisions that have more impact upon our lives than governments do;
MNCs and other non-state actors are said to change and weaken the state centric concept of IR
politics and replace it with transitional world in which relationship is more numerous and
complex than just traditional state to state ones.
Three sets of relations developed between states and non-state actors in IR:
• State deals with one another directly or as member of International

Intergovernmental Organizations (IGOs)
• States deal with NGOs

• NGOs deal with one another.
However states still remain the primary actors in IR
 Why are states the primary actors in IR? What are the reasons?
1. Since WWII the proliferation of new states has increased fourfold.
2. Without states, it will be impossible for non-state actors to function.
• States are the ones with territories and MNCs need the territory of a state
to make profit
• Non-state actors cannot enjoy benefits without at least the acquiescence

and active support of the state.
3. states are sovereign and are the ones who make rules for economic,
communication and diplomatic relationship
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4. The state is the only principal user of legitimate force.
• It can enforce decisions at home and can decide whether to go to war, and
when.
• The state possesses some sovereignty, greater authority and even greater
control capacity over its people and entities (has jail, courts and
executioners, passports, armies and weapons)
B. Sub-State Actors in IR
National governments may be the most important actors in IR, but they are strongly conditioned,
constrained and influenced by a variety of sub-state and non-state actors.
Sub state actors are groups or interest groups (could be political parties and individuals) within
the state that influence the state foreign policy. They are essentially domestic actors pursuing
their goals through transnational activities. Some scholars call such a merger of domestic and
international political activity intermestic politics: a mixture of domestic and international
affairs. Domestic actors‘ actions may cross a state‘s border and affect others outside the state. In
all states, societal pressures influence foreign policy.
The actions of sub-state actors (interest groups, companies, workers, ethnic groups, investors)
helps to create the context of economic activity against which international political events play
out, and within which government must operate.
The sub state actors play various role which take place in what is clearly a world economy- a
global exchange of goods and services woven together by a worldwide network of
communication and culture.
 Who are considered as sub state actors?

1. Interest Groups: coalition of people who share a common interest in the outcome
of some political issues and who organize themselves to try to influence the
outcome.
• EG: environmental activists; HR Activists
2. Ethnic Groups: a group that feels strong emotional ties to their relatives on other
counties:
• Because the rest of the population generally does not care about such
issues one way or the other, even a small ethnic group can have
considerable influence on FP towards a particular country.
• EG: Ethiopian diaspora in USA
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3. Cities: local governments of varied types have become transnational actors; at
least for commercial reasons.
EG:
– in Ethiopia, the regional states and the two administration cities

compete over foreign investors and send trade delegations overseas
to generate businesses.
• Cities around the world also routinely practice ―citizen diplomacy‘ by

passing their national foreign ministries to make trade arrangements: pass
resolutions on every imaginable subject
– (EG: opposing nuclear bomb testing by China and France and

establish ‗sister city‘ programs to offer advice and material aid to
cities in other countries.)
• Cities adjacent to one another but separated by a border can have special
problems and relations.
– EG: Ethio-Sudanese and Ethio-Kenyan boundaries have worked

out agreements concerning roads, bridges and water management.
4. Individuals: there are two types of individuals.
– 1st: individual actor that is empowered with the resources of an

institution like the state and may face dynamic situations that bring
opportunities and dangers requiring bold steps.
– 2nd: an individual actor that becomes important as the symbol of a

moral cause.
• ( the 1st is a public actor and the 2nd is a private actor)

– EG: Henry Kissinger vs Archbishop Desmond Tutu
C. Non-State Actors in IR
1. International Intergovernmental Organizations (IGOs)
These are institutions established by two or more states. They act under a constituent instrument
like treaty/charter/covenant. These treaties provide the purpose and functions of the organization,
the structure and decision making process of the organizations, provisions for regular meetings, a
permanent headquarters, and staff the organization.
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States often take actions through, within or in the context of IGOs whose members are national
governments. For example: UN, AU, EU, the Arab League, NATO, IMF, IGAD, COMESA are
non-state actors through which states take actions.
The scope of IGOs are either broad (encompassing economic, social and economic issues EG:
UN, AU) or specific (dealing with limited issues like that of the WTO, WHO, UNICEF). IGOs
can also be either regional or global. Universal/global IGOs are IGOs whose membership is
open to all; aspire to universal or near universal membership inviting in principle all states to
join. Example could be IGOs like: UN, WTO, WHO.
Limited/regional IGOs are IGOs that aim to organize activities in a certain geographical region,
are open to only states from within that specific region. Examples could be IGOs like that of EU,
AU. The limitedness of such organizations is not only reserved to geography. For example
OPEC is a limited organization, but its membership spans the globe; the scope is limited to only
those states who are economically oil producing states.
IGOs have a number of objectives. Some of the objectives are:
– Maintain international peace and security

– Encouraging states to develop friendly relations and cooperation among
themselves
– Raising international agenda, publicizing problems, and proposing solutions to

those problems
– Saving the environment and threatened animal species on earth
– Treatment of refugees, and observance of fundamental HRs

– Regulating trade in the world
– Facilitating communications and transportations among states
– Increasing production and improving food distribution and marketing

– Promoting the safety and peaceful use of atomic energy
– Promoting employment and improving labor conditions and living standards
– Promoting cooperation on technical matters affecting international shipping

– Aiding the attainment of the highest possible level of health; and many others
2. Non-Governmental Organization (NGOs)
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NGOs base their membership on groups and individuals acting in a private capacity that may or
may not have a political agenda. They draw membership from individuals and private
associations located in several countries. Some have considerable size and resources, they
interact with states and sub-state actors; as well as with MNCs and other NGOs. NGOs are
increasingly being recognized in the UN and other forums, as legitimate actors along with states
(although not equal to states).
NGOs act under a written instrument which set forth agreed purposes and procedures as well as
structure and a central office of the NGOs. NGOs are made up of private individuals, both paid
and unpaid, and are committed to a vast range of issues, including protection of the environment,
improving the level of basic needs in the Third world, stopping HR abuses, delivering food and
medicine to war zones, advancing religious beliefs and promoting the cause of women. They
establish intricate networks and links between individuals across the globe. They are a force not
to be reckoned with; they have huge memberships, budgets and the power to influence and shape
government policy.
Scholarly argument concerning the criteria for determining which organizations should be
classed as NGOs and which should not.
– For some any transnational organization that is not established by a state is an

NGO;
– For others, an NGO is any transnational actor that is not motivated by profit, does
not advocate violence, accepts the principle of non-interference in the domestic
affairs of states, and works closely with the UN and its agencies.
The policy network between IGOs and NGOs are particularly strong in the areas of HRs and
Development. NGOs also exert significant influence over other NGOs too. By lobbying
politicians, exposing bad practices through the media and organizing mass rallies NGOs can put
other NGOs under check.
NGOs acting as IR actors is an evidence that a global civil society is emerging. The growth of
NGOs highlights the growing significance of people power in IR. This has come about mainly
because states have filed to respond to the immediate social, political, environmental and health
needs of individuals
3. Multi-National Corporations (MNCs)
These are profit making business organizations. They are also called Multinational Enterprises
(MNEs) or Trans-National corporations (TNCs). These are powerful actors that carry out
commercial activities for profit in more than one country. They view the world as a single
economic entity and their impact on the global economy is immense.
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They influence almost all areas of human life. For example, they control more than 2/3r of the
world trade, much of which takes place between their own subsidiary firms. The largest 100
MNCs are estimated to account for about 1/3rd of global FDI. Globally there are over 53,000
MNCs, most of the top 500 MNCs have their headquarters in Organization for Economic
Cooperation and Development (OECD) member states.
MNCs are the most controversial of all non-state actors. There are two views regarding the role
of MNCs in IR.
1. they are predators;
They are accused of toppling elected governments, exploiting under developed

countries and engaging in illegal activities.
MNCs extract irreplaceable natural resources, draw off capital out of the host
state, bring in technology unsuited for the hosts development plans; hire skilled
people away from local business, cause host governments to restrict human rights
and willfully damaging the environment. States also deny the right to organize
labor unions, keeping wages low to attract MNCs.
2. MNCs do more good than harm.
They are engines of progress, innovative in research and development, a

modernizing force in IR, and the best hope for overcoming the chronic
underdevelopment and poverty in 3rd world.
MNCs are boom to economic development by defusing technology, capital and

experience throughout the world. They are tools of development, producing jobs
and tax revenue. They introduce technology and so on.
Good effects of MNCs: Bad effects of MNCs:

• Introduce technology • Offer ill-suited technology
• Encourage economic growth • Retard economic growth
• Encourage interdependence • Cause dependency
• Elites learn to regulate • Elites become compradors
• Promote HRs • Harm HRs
• Protect the environment • Hurt the environment
• Economic actors • Political actors
• Promote a cosmopolitan world • Damage the National culture
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Chapter Two
Theories of International Relations

There are variety of different theoretical perspectives within the academic study of IR. The major
theories of IR are: Realism, Transnationalism/Idealism, Structuralism/Marxism, Feminism,
Constructivism and Postmodernism
These theories refer to an attempt to explain something (an event or activity in IR). For example,
the theories try to explain the cause of war, under what conditions states engage in cooperative
trade through different world views/lenses.
2.1. Realism
Assumes the world is made up of unitary and sovereign nation-states that operate in a
competitive self-help environment (anarchy). States act rationally, in the national interest in
order to maximize power and thus ensure survival. The political interests of states (power)
should always be prioritized in relations with other states and the route to power is almost always
defined in terms of military capabilities. The world of politics is made up of states with
competing power interests, thus there is a certain inevitability that states will go to war with one
another.
Realism is traced back to antiquity; it is claimed to be found in important works from Greece,
Rome, India, and China. The intellectual origins for realism are traced back to Thucydides.
Realism has two variant forms: Classical Realism and Neo-Realism
A. Classical Realism: Human Nature and the State in IR
Classical Realists usually characterized as responding to the then dominant liberal approaches to
International Politics; they disagree on how widespread liberalism was during the interwar years.
They assume that the desire for more power is rooted in the flawed nature of humanity, hence,
states are continuously engaged in a struggle to increase their capabilities. The absence of the
international equivalent of a state‘s government is a permissive condition that gives human
appetites free reign.
Classical Realism explains conflictual behaviour (war) by human failings. It explains wars as
acts that are caused by aggressive statesmen or by domestic political systems that give greedy
parochial groups the opportunity to pursue self-serving expansionist foreign policies. For these
theorists, international politics can be characterized as evil: (bad things happen because the
people making foreign policy are sometimes bad)
 Famous Classical Realists:

– Thucydides, Niccolo Machiavelli, Thomas Hobbes, Max Webber, George
Kennan, Edward Hallet Carr and Hans Morgenthau
– Morgenthau‘s book ―Politics among Nations: The struggle for Power and Peace‖
is considered as the standard bearer for political realism
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 Thucydides: discussed about the Peloponnesian War, he argued that the cause for the war
between the Athenians and the Spartans (around 420BC) was an increase in Athenian
military power and the insecurity that it created among the Spartans. He wrote: ―what made
the war inevitable was the growth to Athenian power and the fear which this caused in
Sparta‖. Sparta was wary of the innovative and dynamic nature of Athenian Society, which
was growing and modernizing both economically and militarily. Sparta began to strengthen
its position military in response to the vitality of Athens. The Athenians then grew fearful of
their rival‘s arms build-up and responded in a similar fashion. War between the two erupted
shortly thereafter.
By providing this observation about state behaviour Thucydides begun one of the main
traditions of thinking about IR
 Niccolo Machiavelli: claimed that politics should be described as it is not as ought to be. He
claims that politics should be separated from ethics. Unlike individuals, rulers are not bound
by individual morality. Any action that can be regarded as important for the survival of the
state carries with it a built in justification. He argues for a strong and efficient ruler for whom
power and security are the major concerns. He emphasized the importance of military power
and national security. The survival of the state is the most important goal in politics.
He argues that it is unreasonable to expect that an armed man should obey one who is not; or
that an unarmed man should remain safe and secure when his servants are armed. He claims
that leaders who neglect a national security do so not only at their own risk but also
jeopardize the security of the state as a whole.
The origins of the realism theory can be traced back to these ancient writers; however, the
writers did not actually consider themselves as realists. The theoretical formulation of realism as
an approach in IR is a relatively recent development beginning in the late 1930s and 40s. Some
of the prominent scholars from this era include:
 E. H. Carr and Hans J. Morgenthau: are crucial figures in the development of realism as
an IR theory. They were among the first scholars to use the term realism and to elaborate its
fundamental assumptions by comparing it with idealism which prevailed during the interwar
period. They claim that there was no natural harmony of interests among the states and that it
was foolish and dangerous to hope that the struggle for power among states could be tamed
by international law, democratization and international commerce.
 Hans Morgenthau: politics should be considered distinct from law, morality and economics
and we should focus on the basic concept of political interaction (power) as opposed to the
basic concepts of law, morality or economics. Claims that politics is somehow more realistic
than the other disciplines. Claims that insecurity, aggression and war are recurring themes of
international politics and that these themes are ultimately rooted in human nature. On a
fundamental level, conflict is driven about by political ideological differences as much as
man‘s desire to dominate his fellow man. So he suggested that the statesmen think and act in
terms of power. He assumes that all states have a tendency to behave as rational actors.
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The rational actor assumption claims that states pursue attainable, prudent goals that are
commensurate within their power/capability to achieve. i.e., state strategies are understood as
having been decided rationally after taking costs and benefits of different possible course of
action into account. Hence, a state‘s foreign policy is based on wise calculations of national
interest.
In a system consisting of individual states struggling for power, Morgenthau suggest that the
ever present threats of large scale violence had in the past and could in the future be
contained by pursing a balance of power strategy. This means if two or more coalitions of
states maintain a roughly equal distribution of power, no single state can be confident in its
ability to win a war. Hence, all states would be reluctant to initiate conflict-and so balance,
order and peace would in theory be preserved.
B. Neo-Realism
In the 1960s, classical realism faced increasing scrutiny. The realist world view was revived and
revised with the publication of Kenneth Waltz‘s book (Theory of International politics, 1979).
This book replaced Morgenthau‘s ‗Politics among Nations‘ as the standard bearer for realists.
Waltz argues that systems are composed of a structure and their interacting units.
Neo-realism shares many core assumption of classical realism regarding the state, the problem of
power and the pursuit of interests. However, neo realists place more emphasis on the anarchic
structure of the international system. Neo realism claims that we do not need to look inside the
states to understand their behaviour (this is referred to as ‗black box‘ view of the state). The
black box view of the state is based on waltz‘s proposition that we can scientifically understand
IR only by looking at how the international structure (anarchy) effects on the behaviour of states.
The anarchic international system generates a climate of uncertainty compelling all states to be
distrustful of the intentions of other states. Thus, states seek to ensure that they have as much
power as possible relative to other states. This characterization of the world politics seemed to fit
extremely well with the reality of the Cold War. During CW, there were two very different
states: USA and USSR, yet both states were pursuing broadly similar foreign policies and
international politics was characterized by a climate of distrust between the two states and their
allies.
Some states are more capable than others in this pursuit of power. Hence, weak states, in order to
enhance their position in international politics relative to other states, might form alliances with
other states (The extent to which these states can ever really trust their alliance partners is limited
though.)
There are a variety of alliance formations, but neo realists argue that a situation of bipolarity (two
major centres of power in the international system each of whom have forged alliances with
weaker sates) brings considerable stability to the international system because it involved a
rough balancing of power to international politics. The balancing of power between USA and
USSR during the CW was seen by neo realists as bringing stability and order to international
politics
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Some prominent Neo-realist scholars are:
 Kenneth Waltz: is known as the founder of neo-realist theory. He Suggest that the lack of
central authority is a key to understand the international system and international relations
theory. There is no central world government to enforce peace, states exist in a self-help
system. The anarchic nature of the international system leaves ―every state for itself‘. The
type of self-help situation leads to a security dilemma.
 What is the concept of security dilemma?
Efforts to improve national security have the effect of appearing to threaten other
states, thereby provoking military counter moves. It rests on the assumption that
security is something for which sates compete. The security dilemma encapsulates
one of the many difficult choices facing some governments. Governments can
relax defence efforts in order to facilitate peaceful relations. The problem is that
by doing that they may make their country more vulnerable to attack.
The security dilemma is the result of fear, insecurity and lack of trust among
states living in anarchic international system. States arm themselves in order to
pursue the rational goal of self-preservation. But by arming themselves, more fear
and insecurity is created among other states. These states in turn also increase
their armaments.
Even when a state is arming itself for purely defensive purposes, this process
make all states within the system, less secure and fuels an arms race.
The security dilemma is said to have led to WWI. And it arises primarily from the
alleged structure of the international system rather than the aggressive motives or
intentions of states assumed by the classical theorists. Classical realists argue that
human nature causes states to act in certain ways. Neo-realists on the other hand
argue that the system of international politics is the causal motor of world politics.
C. Common Features of Classical and Neo-Realism:
Both forms of realisms have the following common characteristics:
1. States behave in self-interested manner
2. Sovereign states are the key actors in IR; and they are motivated by national interest
while conducting foreign policy
3. Power is a key factor in understanding IR: both theories assume that global politics is
considered as a contest for power among states. A state‘s power is measure primarily in
terms of its military capabilities. International diplomacy is based on power politics
4. IR is inherently conflictual.
Both theories agree with the aggressive intent of states combine with the actor of world
governments that conflict is an ever resent reality of IR.
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 Why will conflict be inherent? There are three conflicting answers:
1. Human beings are selfish; act only for their own interests even if that means to
disadvantage/harm others and cause conflict; this nature of human being cannot
change.
2. In IR, the pursuit of national interest inevitably leads to naturalistic clashes with
other states.
3. The problem is not of human nature, but the lack of any central authority in the
international realm to control it. This gives rise to anarchy and insecurity and
states are forced to act prudently and in a manner which puts the national interest
first.
5. Order can only be achieved in the international politics through balance of power;
– that is the only way to overcome the international anarchy (which is caused by the
continual struggle for power and security among states)
2.1.2. A Critique of Realist Theory
The theory of realism has both strength and weaknesses.
 Strength:
1. From a practical standpoint, it offers a set of simple, straight forward principles that have
guided states men in their decision making for many years. It focuses on how nations
actually do behave in the international system both individually and collectively.
2. It has a valid strength from a historical, scholarly standpoint. There is a certainly wide
body of historical evidences to support the realists'‘ supposition that states are locked in a
struggle for that can and often does lead to war. Examples of such can be: the conflict
between Athens and Sparta, the series of events and decisions preceding world war I and
II, and the conditions that led to the cold war
 Weakness:
1. It is simple and understandable; yet it‘s claimed to be too simple, it is claimed that by
reducing the complex reality of the world politics to a few general laws which are said to
be applicable over time and space and which omit much of interest and importance from
our analysis. Hence, realists are said to take the substance of IR to be great power
politics, the high politics of state completion, war and aggression. This is of course a key
part of IR but it is not the only aspect we need to look at. This infers that the study of IR
is the study of security. But there are a wide array of hallmarks of international life and
competition and cooperation other than war; in IR we also study economic relations,
international development or international law.
2. In its emphasis on conflict, it tends to ignore the current expansion of cooperation

between states.
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3. Realists accept that great powers rise and fall, and wars come and go, but insist that the
basic rules of the game cannot be changed. Hence they fail to embrace the idea of
substantive changes. As a result, realism is inherently conservative and anti-innovative.
Whether intentionally or not, realism also serves to justify injustice on the ground that
nothing can be done to change things
4. It ignores or significantly downplays the degree to which states might have collective or
mutual interest. So it underestimates the scope for cooperation and purposive changes in
international relations.
5. States are no longer the only important actors on the international stage. IOs and NGOs
perform important functions in marinating stability and expanding cooperation
worldwide.
2.2. Transnationalist (Liberalist or Idealist) Theory
This is a theory that considers that the individual is at the centre of IR instead of the state. States
are considered s ―necessary evil‘ in the functioning of the IR system. This is so because it is
assumed that the existence of large, unrepresentative, undemocratic states fuels the path to war.
This theory Considers that individuals are rational, they are concerned with maximizing utility:
they wish to make things as good as possible for themselves. Individuals share a deep rooted
harmony of interests. These interests include things like: personal freedoms; human rights;
opportunities to engage in wealth creation.
States that are organized around principles of democracy and free trade enable the individual‘s
interests to be reflected in inter-state relations. Such states are less likely to go to war with one
another because going to war goes against the individual‘s ‗harmony of interests‘.
The Core characteristics of this theory claims that what unites human beings is more important
what dives them. This theory dominated the world of IR from the end of WWI till 1930s. It is
considered as a theory that is futurist and seeks a perfect world.
There are various strands of this liberal thought of IR. Some of these variants include: Idealism,
Interdependence, Liberal Internationalism and Neo-liberal Institutionalism, Economic
Transnationalism and Institutional Transnationalism.
Transnationalism is an all embracing ideology. It has something to say about all aspects of all the
human life. It focuses on the idea of promoting global order through expanded political and
economic ties. This theory claims that realism fails to offer adequate explanation for the order
that we see within our ‗presumably anarchic system‘. It argues that states cooperate as much if
not more than they compete. State cooperation is in the common interest of all; cooperation
results in prosperity and stability in the international system. It argue that states are not solely
motivated by national interest which is defined in terms of power. It Claims that international
politics can no longer be divided in to high and low politics. While the high politics of national
security and military power remain important, the economy and social and environmental issues
or low politics have become priorities on the international agenda.
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Four major factors determine the establishments and successes of international order. These four
factors are: the role of international institutions, the international rules and norms for behaviour
of states, the increasing economic interdependence between nation, and technological
advancements and the growth of global communication.
These 4 factors can neither create nor enforce the type of stable international order that might be
provided by a strong world government. But these elements play an indispensable role in
constraining or regulating the behaviour of nation-states within the system, as well as shaping the
international environment as a whole; in building incentives for cooperation, in enhancing thrust
between nations and in promoting negotiation rather than military confrontation as a means to
resolve disputes between states.
 The transnatioalist theory can be distinguished in two branches:

A. Institutional Transnationalism
Institutional transnationalism is also known as idealism. It focuses on institutionalizing global
cooperation. This theory calls s for the creation of a new global power structure supported by
creating and empowering a variety of international organizations. It believes that global
cooperation is founded upon three primary factors:
i. enhancing the role and influence of international organizations

ii. instituting collective security and
iii. International law.
All the three factors can be viewed as prescriptions for how states should behave with an
ultimate goal of reforming the anarchy of the international system and forging a harmonious
community of nations.
Idealists believe that the relation between states in the international system needs to be
fundamentally reformed to ensure future wars might be avoided.
Woodrow Wilson, a prominent scholar from this branch of transnationalism, believed that the
power primes which are considered to be so critical in realist theory, was unlikely to produce a
stable international order. He wanted to build an international community of nations; (assumed
that having such institutions could solve the problem of power politics). He assumed that based
on international law and specific rules and norms of behaviour would be regulated by
international institutions. To this effect, he suggested that order within the community could be
preserved through collective security.
 What is Collective security?

It is a system in which states stand together to safeguard the territorial independence and
security of one another against aggression. Collective security differs from balance of
power politics. Collective security is not directed against a specific nation but against any
state that threatens the status quo. Enforcing international law would be a collective
responsibility for the good of all states within the community
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B. Economic Transnationalism
This branch of transnationalism is also known as interdependence model. It emphasizes

economic ties between nations as basis to establish and preserve order within the international
system. Similar to idealism, it highlights the transnational ties or linkages between states.
Different to liberalists, these theorists identify the increasingly integrated nature of the global
economy as a major force in promoting those linkages.
Under this theory, Interdependence is a pivotal part of economic transnationalist theory. States
are increasingly interconnected or interdependent as a result of the merging of the international
and domestic economic interests. In this theory, expansion of global trade and investment has
blurred the distinction between domestic economics of individual states and of international
economy as a whole.
The more states interact with in the global marketplace, the more their prosperity depends on the
political and economic cooperation with other states. Interdependence is based on three general
assumptions:
– States are not the only key actors in IR.

 IGOs, NGOs, MNCs, economic cartels, religious groups and the like take
positions on the global stage
– The agenda of IR is more complex and diverse than in the past.
 New issues like trade, technology and the environment can be as important
as traditional national security concerns
– Military force plays less of a role in contemporary international politics.

 Economic interdependence along with expanded political ties have
increased the value of cooperation and decreased the utility of force.
– Power is no longer measured solely in terms of military strength.

 Power to influence is often the result of economic flexibility or
technological innovation, and leadership; it involves negotiating expertise
and economic coordination.
– Interdependence has dramatically increased the incentives for cooperation not

only among states but among all international actors.
All forms of transnationalism Claim that the harmony of interests among states can be attained.
 What is Harmony of interests?

This is the belief that the interest of all states coincides with economic transnationalists and
focuses on the mutual advantages of cooperation between nations.
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For institutional nationalists, harmony of interests emphasizes that the security of all nations is
enhanced by international cooperation. For economic transnationalists, harmony of interests
revolves around how the growing economic interdependence of nations brings security of all
nations. For both branches of this theory, the utility of power and military force as instruments of
FP has been marginalized by greater linkages and expanded cooperation-political or economic-
among all nations of the international system.
2.2.2. A critique of Transnationalist Theory
1. This theory emphasizes too much on harmony of interests.
– Cooperation between states (political, economic or military) is subject to a

number of international and external pressures, making success much more
problematic than transnationalists might imply
2. Regarding human nature, realist critics suggest that the transnationalism underestimates
the conflictual aspect of state interests and that the benefits of cooperation can often be
outweighed by fear and mistrust
3. It fails to take into account the powerful role of nationalism in world politics.
– Both ancient and contemporary human history shows clear examples where
religion or ethnicity formed the basis for conflict between nations.
1. (EG: crusades, events in Rwanda; all show human nature offers more
complex questions that transnationalist theory is prepared to answer in this
regard).
2. Nuclear weapons may have deterred super power confrontation but

conventional conflict between smaller states still occurs.
3. Since east-west coalitions have loosened, states now pursue their own
narrow interests– guided by ethnic or nationalist ideals.
4. The state cannot be expected to pursue collective gains on a consistent basis.
– Maintaining long term cooperation between nations is more problematic than

transnationalism implies.
– Like individuals, states can be attracted by relative gains, settling for less gain but
more control and self-reliance than the broader cooperation of transnationalism
necessitates.
– The goal and prioritise can also change making such an arrangement too
confining or inappropriate under new or altered circumstances.
5. The theme of national interest (as opposed to transnationalism‘s collective interest) is
evident in many past and contemporary conflicts throughout the world.
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6. Small countries with limited economic or geopolitical value to the major powers rely on
collective security only at their own considerable peril/risk.
7. This theory is viewed as western centric;
– Critics view interdependence as exploitative of rather than beneficial to less

developed countries.
– Interdependence affects countries differently. For example, ddeveloping nations

like Ethiopia are more vulnerable to the economic shifts and cultural intrusion or
imperialism associated with interdependence that richer industrialized state like
the US.
2.3. Structuralism, Marxism or Class Theory
Marxism is an ideology derived from Karl Marx critique of Capitalism. It is a dialectical

theoretical approach (an approach based on the cognitive and material struggle to overcome the
social contradictions of the accumulation of wealth)
2.3.1. Structuralism: Basic Concepts
Structuralism is also known as the radical, globalist or Neo-Marxist theory. This theory argues
that it is classes and the division between them that define and determine the course of IR (hence
also known as Class System)
This Based on 4 important concepts:
1. economic factors are the driving forces of IR

• Political and military power are the direct result of the underlying
economic strength or the dominant class.
2. Focuses on the development of the capitalist world economy and how it both
creates and perpetuates uneven development between advanced capitalist states
and poor less developed states
3. Points to an international class structure in which the advanced industrialized

states (the center/core of the world capitalist system) dominate and exploit poorer
states (the periphery of this system.)
4. Transnational class coalitions represent the primary actors in international

politics.
• States are important but only as agents of the dominant class.

• Non-state actors most notably MNCs allow capitalist elites to maintain the
exploitative economic links that bind core countries with those on the
periphery
Proponents of the theory argue that global economic relations are structured so as to benefit
certain social classes, and that the resulting world system is fundamentally unjust.
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Structuralism resembles realism in a sense that both emphasize conflict as a central process of
IR. To this effect, Neo-realism and structuralism share the view that conflict is structural because
of the framework in which interstate /economic relations take place. However, unlike realism (
which claims that states only pursue national security interests), this theory argues that states act
in accordance with the wishes of the dominant economic class within the state. Structuralists say
that the capitalist class is the dominant class, and the Foreign Policy of the state will therefore be
oriented to enhance the wealth and influence of the capitalist class.
Structuralism also shares common ground with transnationalism. Both theories emphasize the
profoundly interconnected nature of international economic relations and the importance of non-
state actors. But structuralism stresses the conflictual nature of the global economy and structural
relations of the domination and dependency, rather than the anarchic nature of the state system or
complex interdependence. For structuralists economic forces are key parts of the framework of
their theory. Unlike economic transnationalists, structuralists emphasize the exploitative nature
of international economic ties between states. They believe there is a system wide hierarchy of
classes and states that is rooted in the unequal distribution of wealth. For them the structure and
process of IR is largely the result of the struggle between rich and poor countries (North-South
Conflict). Conflict is assumed to occur by the clash of opposing economic interests namely the
clash between capitalist and non-capitalist states. War is the result of capitalist states attempting
to increase their wealth and power through imperialist foreign policies in which strong capitalist
states seek to exploit non-capitalist states. Such conflicts will continue until the international
status quo is radically altered, socialism replaces capitalism as the dominant socio-economic
system and a more equitable distribution of wealth among nations is attained.
However, the change will not be an easy one. This is mainly because the capitalist world system
beneficiaries (the dominant capital class) have a stake in preventing such radical change and
preserving the current arrangement, keeping the rich wealthy and the poor poorer.
This theory highlights the connection between politics and economics. It acknowledges that
states are important actors, but also emphasize that the dominant class exerts significant
influence and often controls government policy makers.
In this theory, Non-state actors like MNCs and IOs are considered to have a great role as they
foster transnational class coalitions. The idea of transnational class coalitions suggests that
economic classes form close ties across nation‘s boundaries.
Transnational class coalition is very different from transnationalism theory. Under this theory
MNCs are considered to be mechanisms by which capitalist class penetrates the poor countries.
MNCs exploit lesser developed countries as a source of cheap labor and inexpensive natural
resources. Then, they transfer profits from the lesser developed state to the base of operations in
advanced capitalist states. These profits enable the capitalist class to increase global influence
and sustain a dominant position in the world.
Why doesn't the capitalist society show a more selfless attitude more broadly? Why are some
counties rich and some poor? In trying to answer these questions, structuralism claims that
human nature tends towards self-interest and the need to dominate other. And the answer here is
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similar to the assumptions in realism theory. But unlike realism, this theory believes that if
society were based more on an equal distribution of wealth, the aggressive and negative aspects
of human nature might be reformed and perfected.
 Main features of the Strucutralist perspective include the following points:

• The nature of IR is profoundly shaped by the structure of the capitalist world economy or
capitalist world system
– Capitalism is fundamentally unjust social and economic order which generates

conflict and disharmony
– Capitalism is based on the exploitation of the poor by the rich.

• IR is shaped by or even determined by economic actor
• The main actors are states, MNCs and transnational corporations and transnational social
classes
• The state reflects the interests of dominant classes rather than the existence of the genuine
national interest
2.3.2. Variants of the structuralist theory

A. Dependency theory:
Advocates of this variant of the Marxist theory include: Theotonio, Doe Santos and Immanuel
Watllerstein. This theory tries to explain the underdevelopment in wealth between poor and rich
countries. It claims that trade, foreign investment, and foreign aid between advanced and
industrialized courtiers and poor, less developed states is inherently exploitive, works to the
disadvantage of the poor nations and perpetuates the dependency of these less developed
countries.
Dominant core countries have a stake in preserving this cycle of dependency and exploitation
that exists with periphery and semi-periphery states and pursue foreign and domestic polices to
further that goal. Poor and less developed countries are virtually class coalitions,
B. Class Theory
This variant of the Marxist theory argues that strong capitalist nations have allies in these poor
nations. Small groups of capitalist elites in the peripheral states act as liaisons (links) to the
partners with leaders, policy makers and businesses executive in the core countries. These elites
have more in common with the capitalists of foreign nations than with the underclass of their
own state. They too then have a stake in preserving the status quo of dependency; and exploit
their own country.
2.3.2. A critique of Structuralism
1. It exaggerates the role that the world capitalist system plays in limiting development;
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• It ignores the impact that policies adopted in the less developed states
themselves have on their own economic development.
• Dependency theory can only account for countries that have failed to
develop.
• Rapid and successful industrial development in Taiwan, Singapore, Hong

Kong, South Korea and Brazil is difficult for structuralism to explain or
dismiss.
– Contrary to the suppositions of structuralism, capitalism can be beneficial and

bring prosperity to developing countries.
2. Structuralism relies on case studies that conform to and confirm their particular
paradigm.
– States that fall outside these parameters tend to be ignored.

– This is a theoretical blind eye;
• It is particularly true with respect to the weakness of communist nations.
While focusing on North and South relations, class system theorists fail to
account for a significant percentage of the global.
• The former USSR and Eastern Europe states, even china, present some
difficulties for the structuralism paradigm.
• Certainly during the CW era, the USSR maintained policies of

imperialism in the subjugation and exploitation of Eastern,
– Imperialist domination of other stats is evidently not limited solely to capitalist

powers.
3. It is reductionist:
– It reduces all phenomena (war, economic crisis, inequality, aspects of identify and
the like) to the dynamic of capitalism and to social class and class struggle.
• This means structuralists have failed to ask a whole range of questions
about gender, ethnicity and identities of other sorts.
– They have reduced a highly complex situation to one which is wholly explained
by class, when in fact, patterns of oppression are multi-faceted and overlapping
ones,
4. The way interests are understood in the theory may be questionable:
– Is it really possible that interests are so fundamentally determined by social class?
– Are interests really this fixed?
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In spite of these flaws the theory still provides important insights into the economic development
process and remains a highly popular explanation of global politics
2.4. Feminism
Feminism is the study of a movement that calls for women not to be seen as objects but as
subjects of knowledge. Until 1980s, the role of gender in the theory and practice of IR was
generally ignored. After 1980s, Feminism has emerged as a key critical perspective with in the
study of IR
The main aim of this theory is to challenge the fundamental biases of IR; and highlight the ways
in which women were excluded form analysis of the state, international political economy and
international security. It argues that the current system fails to promote the interests and roles of
women in the world community.
It considers IR as one sided, masculinist and not fully representative of women's contributions
and issues. Feminists draw attention to the way in which we construct certain ideas about male
and female characteristics: Men are viewed as: strong, violent yet rational while Women are
viewed as: passive, caring and emotional.
Both the theories of realism and neo-realism claim the world is full of rational states struggling
to survive in a hostile and violent world. Feminists claim that this clearly shows that the world
has been conceived with masculinist assumptions in mind. Feminists criticize the realist and neo-
realist theory saying that the two theories overemphasis on violence, aggression and competition
is wrong. They say that this is androcentricism (taking characteristics associated with
masculinity and universalizing them).
As to the feminists, the way in which the state has conventionally been understood in much IR
theories is wrong. IR simply assumes that international politics is something that is conducted by
sovereign states. This is wrong for the feminists.
Jill Steans, a proponent of the feminist theory, says: ―this obscures the extent to which things
happen below the state, effectively assigning the study of gender relations to a domestic realm
that has no place in the high politics of the international realm‖. Jill says, by doing so, IR
scholars are able to maintain the useful fiction of gender neutrality because gender is not seen to
have a legitimate place within the study of international politics.
But feminists point out that understanding the state as ‗gender neutral‘ obscure extent to which
states have acted to institutionalize gender inequality throughout their legal and bureaucratic
structures and policy practices. The dominance of male scholars within the academic discipline
of IR is manifested in the androcentric bias of the discipline. The attachment to rational
objective of social scientific method found in mainstream positivist IR theory is indicative of the
male bias within the discipline. Positivist approaches in IR generate a discipline that is all about
objective scientific values rather than the ways in which international politics touches down and
impacts on the everyday lives of ordinary people.
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Some consider this ontological revisionism (a process whereby scholars go beyond accepted
definitions to show how these definitions mask and disguise gendered power relations). One
benefit of feminist IR is that it has opened up a space for the voice of the disadvantaged to be
brought into the discipline.
Feminism is an umbrella term; it embraces a wide range of critical theory aimed at examining the
role of gender in IR. There is: Liberal feminism, Radical feminism, Marxist feminism, Post-
Marxist or Socialist feminism, Postmodernist feminism, etc.
Feminism is sometimes equated with idealism and they have themselves been criticized for
ignoring men in their eagerness to promote the emancipation of women.
 The basic assumptions of feminist theory:

• Employs gender as a central categories of analysis
• Regarded gender as a particular kind of relationship
– Believe that women have been subjected to discrimination and unequal treatment
• Contemporary feminist theory does not solely focus on the lives of women but is an
analysis of the socially and culturally constructed category: gender
• Most feminists in IR would probably regard male scholars and students as ‗good
feminists‘ when they engage seriously with feminist ideas and arguments and incorporate
feminist concepts and analysis into their own work
• Challenge the idea that the nation state is the principal referent of security.
– The degree to which people feel or actually are threatened varies according to
their economic political, social or personal circumstances.
– Gender hierarches and inequalities can be shown to constitute an obstacle to the
achievement of genuine security
2.4.2. A Critique of Feminist Theory
1. It fails to provide a comprehensive theoretical construct for analyzing IR.

– It focuses much on how the situation in world politics and the study of world
politics might be changed; it doesn't supply explanatory and theoretical tools to
construct a thorough analysis
2. These theorists risk reinforcing the same gender stereotyping they are trying to overcome.
– They use selective characterization of women

• women presented as more cooperative peaceful and men as violent and
aggressive
3. Gender may not provide a sufficient explanation for past and contemporary international
politics.
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– Large forces shape the behavior of various actors on the world stage, irrespective
of gender
• EG: forces like: human nature, disparities in wealth and power, anarchic
world system etc.
• Critics claim that even when women have assumed leadership positions
and confronted the same global problem that men have confronted,
women have acted in a similar fashion
4. Feminism does not take into account other major divisions between women based on
social class or ethnicity.
– Feminism relies upon the notion that there is a universal category of ‗women‘ and
that women share certain common experiences or interests.
• But what women experience and the social meaning ascribed to gender
differences is different from society to society and from culture to culture.
2.5. Constructivist Theory
This is a distinctive approach to IR; it emphasizes the social or inter-subjective dimension of

world politics. It believe that all knowledge of the world is ‗socially constructed‘. It claims that
knowledge reflects our own prejudices, ideas and assumptions rather than some kind of objective
social reality
This theory starts by mentioning how IR cannot be reduced to rational action and interaction
within material constraints or within institutional constrains at the international and national
levels. State interaction is not among fixed National Interest, but must be understood as a pattern
of action that shapes and is shaped by identities over time. The theory argues that states fulfill
their goals depending upon their social identities (how states see themselves in relation to other
states in international society).
Constructivists assume that States may have many different social identities that can be
cooperative or conflictual and that the states‘ interests vary accordingly. States define their
interests in the process of interpreting the social situations in which they are participants.
 Basic characteristics of the constructivist theory:

• Draws on sociological theories; stresses the societal aspect of IR instead of the
mechanistic qualities of the international system in neo-realism
• Concerned with how interests are constructed in IR
– Do not deny the role of interests in policy making, but try to understand how these
interests are constructed
• Interested in the role of ideas, norms, institutions, identity and culture in IR.
– Norms are crucial in the process of socialization.
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• Similar to individuals, states become socialized into the particular form of
international society
• Understands that social sciences cannot operate like the natural sciences; however, insist
on the possibility to theorize and empirically analyze IR as a reality
Constructivism is interested in how actors define their National Interest (NI); threats to choose
interests and their relationships to one another. For realists state interests are given, but for
constructivists IR is put in the context of broader social relations- examining questions
surrounding identities. For example, why is Great Britain‘s nuclear power not a threat to USA
while North Korea‘s is? Constructivists say this is because of the shared history, alliance ad
norms between USA and Great Britain tell USA that Great Britain cannot be an enemy.
For consturctivists, State identities are complex, challenging and arise from interactions with
other states; through a process of socialization. Over time states can conceptualize each other in a
way that there becomes no danger of a security dilemma, arms race or the other effects of
anarchy. The international system consist of social relationships as well as material capabilities.
Social relationships give meaning to materiel capabilities.
Constructivists understand international institutions as much more than actual organization. They
regard it as a stable set or structure of identities and interests. Institutions are fundamentally
cognitive (imaginary) entities that do not exist apart from actors‘ ideas about how the world
works. Institutions embody the constitutive and regulative norms and rules of international
interactions; like shaping, constraining and giving meaning to state action and in part define what
it is to be a state. Constructivists assume that Institutions continue to exist because states produce
and reproduce them through practice; state identities and interests (how states relate to one
another) can be changed at the systemic level through institutionally mediated interactions.
Constructivists focus most of their attention on institutions that exist at a fundamental level of
international society like international law, diplomacy and sovereignty.
Regimes are also important in this theory. Regimes reproduce constitutive as well as regulative
norms. They help to create a common social world for interpreting the meaning of behavior. A
regime‘s proper functioning presupposes that the more fundamental institutions are already in
place, making its activities possible. Regimes therefore do not create cooperation; they benefit
from the cooperative effects of much deeper structures.
2.5.2. A Critique of Constructivist Theory
1. Most of the concepts that constructivists operate with are rather unclearly defined.
• Some analyses for instance talk about identity, culture, norms and
institutions, and it can be rather difficult to separate them.
2. As a theoretical approach, it is difficult to employ.
• It does not predict any particular social structure to govern the behavior of
states. It rather requires that a given social relationship be examined,
articulated, and ultimately, understood.
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» When this is done, then it may be possible to predict state
behavior within that particular structure.
– But if these predictions prove false, it could be that the governing

social structures were not properly understood or have simply
changed.
2.6. Theory of Postmodernism
This is a broad approach to scholarship that has left its mark on various academic disciplines,
especially the study of literature. It is an approach that is based on the questioning of knowledge
claims, and focused on exposing the linkages between knowledge creation and power. It
emerged in the 1980s
Characterized by three main themes.
 1st theme: attacking metanarratives

Postmodernists are hostile towards claims to universal or absolute truth. The theory assumes that
there can be no objective knowledge of the world- no basis upon which we can make these
claims to a universal position of truth. They reject the idea of an external reality independent of
our perceptions and the language we use to express those perceptions and therefore they claim to
undermine the traditional distinction between theory and practice.
Postmodernists argue that all truth claims are based on metanarratives (background worldviews),
according to which particular claims to truth or value are legitimated or rejected. Central to the
postmodernist approach is an attack on metanarratives- theories tied to a particular set of truth
claims about the world.
The theory claims that we should be wary of the claims of the dominant metanarratives of
modernity, the competing accounts of universal human nature, knowledge and historical progress
that constitute the various streams of the enlightenment project, notably those of realism,
idealism, Marxism and modern scientific methods.
 2nd theme: Emancipatory narratives are oppressive.

Post modernists seek to unmask ‗supposedly emancipatory‘ grand narratives as oppressive. They
say that particular liberations have given birth to new forms of caging. For example, they say:
Liberalism has emancipated us from feudalism only to deliver us to capitalism; and that Marxism
has merely replaced capitalism with Stalinism; and also, Modern Science has neglected and
marginalized pre-modern forms of human knowledge.
The conception of the metanarrative excludes, as its shadow, a conception of the ‗other‘ that
does not fit that particular category. The excluded other can then be legitimately oppressed. And
so postmodernists say that truth itself is a mask for power.
 3rd theme: Respect for difference

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Postmodernism might be summed up as ‗respect for difference‘. We should be wary of any large
scale programs of liberation. Rather than revolution, our focus should be resistance at a local
specific level. We should turn away from Universalist understandings and principles towards a
heightened respect for and fostering of otherness.
The central idea of postmodernism is that there is no single, objective reality but a multiplicity of
experiences and perspectives that defy categorization. For this reason, postmodernism by itself is
difficult to present in a simple or categorical way.
From a postmodern perspective, realism cannot justify its claim that states are the central actors
in IR and that states operate as unitary actors with coherent sets of objective interests (which they
pursue through international power politics). No ‗one set of values or interests‘ applies to all
states. There is nothing objective about state interests, and certainly nothing universal about it (as
is claimed by realism)
Postmodernism calls in to question the whole notion of ‗states as actors‘. States have no tangible
reality; they are fictions that we construct to make sense of the actions of large numbers of
individuals. The stories told about the actions and policies of states are just stories.
At the core of postmodernist thinking is a belief that the person studying international relations
cannot be separated from the object of their studies. So where as some theorists of IR (neo-
realism in particular) placed emphasis on the need for the scholar to look at the world from an
impartial value-free objective standpoint, postmodernists claim that the goal for value free
neutrality can never be attained. Things like the social class, race and ethnicity gender and
nationality of the author all impinge in some way on how knowledge is created. For them,
orthodox students of IR are forever in search of some elusive ideal (order, stability, freedom, and
equality).
Theories that present themselves as value free and scientific do so because being described as
such adds legitimacy to the work of a scholar; but postmodernists argue instead that these
theories are as unscientific, subjective and full of values and opinions as any other set of theories.
In the study f IR, scholars inspired by postmodernism draw our attention to the ways in which
knowledge and power are indivisibly connected in the theory and practice of IR
2.6.1. A critique of Postmodernism
1. It gives us no way of distinguishing between good and bad forms of knowledge
2. If we cannot grasp life from a single perspective, and power is everywhere,

ultimately this means we cannot judge the validity of different discourses
3. Accused of being a little more than a trendy manifestation of cognitive and ethical
relativism.
• For example, the postmodernist critique of modern reason world seem to
exclude it from participating in any renewal of normative arguments about
a just world order. By reducing truth and ethics to power, the postmodern
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deconstruction of realism ends up by reaffirming the view that power
cannot be controlled to serve emancipatory human interests, assuming that
they exit of course.
Chapter Three
Understanding National Interest, Foreign Policy and Diplomacy
3.1. Defining National Interest (NI)
It‘s the main driving force that determines the contents of foreign policy. But there are
controversies on the exact meaning, scope and contents of what is meant by ‗NI‘. It amounts to
the set of values, orientation, goals and objectives that a country wants to achieve in its
international relations. NI is the raison de`tat (reason of state) to justify its actions and policy
towards other states at the international level.
Different scholars define it differently:
A.K. Holsti defines NI as follows: “NI is an image of the future state of affairs and future set of
conditions that governments through individual policy makers aspire to bring about by wielding
influence abroad and by changing or sustaining the behaviors of other states.‖ Thus for him, NI
is something related to the ambition of governments; what they wish to fulfill in future
interactions with other states; and power/the ability to influence the behaviors of other states is a
primary instrument to implement NI
Seabury defines NI as a set of purposes which a nations should seek to realize in the conduct of
its foreign relations. He says that NI amounts to those purposes which the nation/state through its
leadership appears to pursue persistently over time.
Colmbis has provided a multiplicity of criteria used in defining NI:
A. Operational Philosophy:
There are two ways of operation in Foreign Policy Decision Making (FPDM).
1. Synoptic Orientation of Decision Making: this amounts to acting in a bold sweeping

fashion (upon taking office, introduce major new practices, policies and institutions and
discontinue others). In this form of decision making, the decision maker assumes that he/she has
enough information about an important issue to develop a major policy with some confidence
that its consequences can be predicted or controlled.
2. Incremental Orientation of Decision Making: this is when the decision maker acts in
caution, probing and experimental fashion, following the trial and error approach. Decision
maker assumes that political and economic problems are too complex to proceed with bold
initiative without worrying about their consequence. Thus, seeks to perfect existing legislations,
policies, institutions and practices
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B. Ideological criteria
NI may be shaped by underlying ideological orientations of the regime in power. Ideology serves
as a litmus paper for identifying friends or enemies in IR as governments use ideological criteria
to establish their relations with other states. For example during the Cold War period, ideology
was used to identify friends from foe in the bipolar world system of the time.
C. Moral and Legal Criteria
Sometimes states are expected to act morally (acting honestly and making public decisions
accordingly). Moral behavior in international politics involves: keeping your promise; living and
letting others live; standing up for the principles to which you are morally committed and that are
widely accepted in your culture
Acting legally in the international system amounts to abiding by the rules of international law.
D. Pragmatic Criteria
This criteria tells that matter of fact in shaping your National Interest is your orientation. You
look at issues and events around you and the world with sense of prudence (carefulness) and with
sort of rationality. Decisions are made based on scientific analysis of cost and benefit or merit
and demerit to your country's interest.
Normative issues, issues involving judgment are not considered while making FP decisions.
E. Professional Advancement Criteria
The FPDM can be affected by the desire for one‘s own personal success; thus the NI might
become the action of the decision maker which he/she choses to promote his/her professional
survival and growth. The leaders (decision makers) might choose conformity to either to popular
pressure or
F. Partisan criteria
The success of your country might be equated with the survival and success of your political
party/ethnic origin/religious origin; thus you may use bureaucratic criteria to prioritize the policy
issues. The interest of your organization/group might be equated with the NI of the state.
G. Foreign Dependency Criteria
This form of National Interest creation applies to less developed states who fell for colonialism
and have now kept ties with their ex masters in spite of gaining political independence. They still
depend on their ex masters for technical aid, expertise and technology; and even security. Thus
the state will have a hard time to promote its NI as a result of their dependence on external
powers.
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National interest can also be defined in different ways based on the theoretical assumptions of
the different theories of IR.
 What do realist think about NI?

Hans Morgenthau, one of the famous scholars supporting the idea of realism,defines NI in
terms of pursuits of power. For him, Power is about establishing control or influencing the
behaviors of others (either diplomatically or by using coercion). He says that international
politics is a struggle among states; the main interest of state is survival and security. So he claims
that NI in a competitive and anarchical international environment, should be defined objectively
in terms of ensuring survival and security of a state. And so, ideological concepts like legal,
moral and justice should not have a place to define NI.
Morgenthau warns leaders of states to be cautious enough in calculating the range and scope of
their countries NI. The scope of NI and their foreign policy should be proportional to their
capabilities. For him, a good diplomat is a rational diplomat; a rational diplomat is a prudent
diplomat; where Prudence is considered to be the ability to assess one‘s needs and aspirations
while carefully balancing them against the needs and aspirations of others.
Realists fail to recognize and prescribe solutions for addressing global problems
 What do idealists think about NI?

Idealists feel strongly about the relevance of legal, ideological and moral elements. They claim
that specific actions and objective of FP have often been derived from general moral and legal
guidelines and principles. And it is agreed in this theory that Moral and legal grounds are used to
justify policies like: the formation of alliance, declaration of war, covert foreign intervention,
humanitarian intervention, foreign aid and others.
NI reflects the marriage of different criteria that include legal and moral criteria, ideological
criteria and prudence or pragmatism (practical necessities on the ground) for the idealists. They
believe on the prevalence of common problems of human beings; and call for global solutions
for such problems (than local /national solutions). They also believe that the establishment of
new intuitions with global orientation may play vital role in addressing global problems and that
states could no longer be the only viable actors in addressing such problems by themselves.
3.1.2. Classification of National Interest
NI can be classified in to 5 as follows:
1. Primary Interest: are vital and core interests of a state. Examples of such interests
include the interest for security and survival.
2. Secondary Interest: these are vita but not critical interests. Some examples for these
types of national interests include: protection of citizens aboard and ensuring diplomatic
immunities of the diplomatic staff
3. Permanent Interest: these are long term interests of states which rarely change.
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4. Variable Interest: these are vital interests of a state within a certain circumstances.
These are interests that are influenced by different factors like institutions personalities,
ideas, time and place
5. General Interest: shared or common interests shared between many states. Examples of
such interests could be: trading, diplomatic relations and commercial contacts.
3.2. Understanding Foreign Policy and Foreign Policy Behaviors
3.2.1. Defining Foreign Policy (FP)
Foreign Policy is understood as the sets of objectives and instruments that a state adopts to guide
its relations with the outside world. FP is something that a state would like to achieve in its
external relations with others. It involves the general purposes and specific strategies a state
employs to achieve or promote its NI.
Different scholars try to define the concept in various ways. For example, according to Rochester
FP is defined as follows: ―FP is the set of priorities and percepts established by national leaders
to serve as guidelines for choosing among various courses of action in specific situations in
international affairs.‖ For him, NI is the set of objectives, visions and goals that a state aspires to
achieve. And all states want to aspire their NI as their capability or power allows them to do.
And according to Mortnthau, the basic minimum goal for NI is survival. Every state tries to
protect their: Physical identity (maintaining territorial integrity), Political identity (preserving
existing politico-economic system) and their cultural identity (ethnic, religious and linguistic and
historical norms of the people in the state).
FP involves specific instruments and tactics to realize the NI of a state. The instruments/tactics
include: diplomatic bargaining, economic instruments, propaganda, terrorism (sabotage), and use
of force/war. These instruments are used to affect the behaviors of other states.
3.2.2. Foreign Policy Objectives
Security and survival of a state are the basic priorities among various FP objectives. K.J. Holisti
categorizes FP objectives in to 3 as: Short Range Objectives (core interests and values), Middle
Range Objectives, and Long Range Objectives. These classifications are based on a combination
of three criteria:
1. The value placed on the objective

2. The time element placed on its achievement
3. The kind of demands the objectives imposes on other states in

international system.
A. Short Range Objectives (Core Interests and Values)
These are goals for which most people are willing to make ultimate sacrifices. They are usually
stated in the form of basic principles of FP and become article of faith that society accepts
without any questioning. These goals that are sacrosanct (untouchable) by entire people residing
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in the state. And they are usually related to: self-preservation of political and economic systems,
the people and its culture, and the territorial integrity of a state.
The exact definition for what constitutes Short Range Objectives depends on the attitudes of
those who make FP. Some put great values on controlling or defending neighboring territories.
This is called Extra territoriality; which means when the NI and claims of a country are projected
beyond the limit of its geographic boundary. Some put great value in protecting the interests and
the security of their citizens or kin ethnic or religious groups living in the neighboring states and
other states.
The most essential objective of any FP‘s core interests and values is:
– To ensure the sovereignty and independence of the home territory; and

– To perpetuate (continue) a particular political, social and economic systems based
on that territory.
B. Middle Range Objectives
Middle range objectives vary across states due to the difference in the level of: economic and
technological progress and their military capability
What a state likes to achieve in its medium term may include: to take a course of actions that
have the highest impact on the domestic economic and welfare needs and expectation. This
includes attempt of governments to meet economic betterment demands and needs through
international action.
To satisfy domestic needs and aspirations that amount to their middle range objectives, states
would have to interact with other states (Interdependence). Trade, foreign aid, access to
communication facilities, sources of supply and foreign market are necessary for a state to
increase its social welfare.
C. Long Range Objectives
These are plans, dreams and visions concerning the ultimate political or ideological organization
of the international system, and the rules governing relations in that system. Long range
objectives may have international outcomes as far as they are complemented by the capabilities
and powers.
Even the middle powers and developing states have their own long range objectives. Every
country has its own visions and ambition proportional to its relative strength and capabilities to
be realized in the long run.
Long range objectives differ from middle range objectives in terms of the time element that both
need and also in terms of scope. In terms of scope, middle range objectives make particular
demands against particular interests; while in the long range objectives states normally make
universal demands ; and their purpose here is to reconstruct an entire international system
according to a universally applicable plan or vision.
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3.2.3. Foreign Policy Behavior: Patterns and Trends
Foreign policy behavior refers to the actions states take towards each other. Usually, these
actions are not ends by themselves. The actions are tied to some form of purpose or objective
that leaders hope to achieve in their dealings with other countries.
Arnold Wolfers: identified 3 FP patterns for the foreign policy behavior of states:
A. Self-Preservation (maintaining the status quo);
• EG: USA after the WWII shaped international organizations like the IMF,
WTO, World Bank to serve the global interest of the USA- which is to
remain the world hegemon.)
B. Self-Extension (revising the status quo in one‘s own favor)
• EG: BRICS states and other newly emerging powers compete to

restructure the international institutions and different regimes to create
enabling environment to promote their NI
C. Self-Abnegation (revising the status quo in someone else‘s favor)
• EG: Least Developed Countries (LDCs), usually fail to defend and

promote their national interest in their external relations as they are
dependent on others. Thus they face the challenges of compromising their
long lasting national interest for temporary and immediate benefits.
3.2.4. Foreign Policy Dimensions
FP behavior can change over time and with different style of leaderships and circumstances.
Based on these dimensions FP behavior can be analyzed in terms of:
1. Alignment
A country‘s alignment behavior can vary from time to time in response to changing
circumstances and policy decisions
 There are 3 alignment tendencies
I. Alliance: this is when formal agreements to provide mutual military assistance; by doing so,
they carry legal weight and certain benefits and risks. Positive sides of alliance include the fact
that allied states can pool their military resources, acquire access to foreign bases; while the
negative side of alliance includes the fact that states risk interference by allies in its domestic
affairs as well as generating potential enemies and counter alliance
II. Neutrality: this is stance of formal non partnership in world affairs. It may also refer to
describe the general affective orientation of a country; countries can tilt towards one side or
another in some strategic issues without necessarily becoming part of formal alliances. For
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example, Israel is not a formal ally of US; but sides with the US on many issues. By avoiding
alliance, states may avoid some of the problems associated with alliances (the possibility of
generating potential enemies and counter alliances).
III. Non alignment: is a pattern followed by most of the developing states during Cold War.
They disregarded both the West and East bloc politics and alliances; and they called for the
South-South cooperation
2. Scope
The scope of a country's activities and interests is also a FP dimension. The scope of contact of a
country can affect the outcome of disputes and crises. In terms of scope, there are three patterns
of FP behaviors:
I. A state acting in Global terms:
Major Powers in IR define their interests in global terms. For example, USA defines its national
interest in global terms (it has a strong military and diplomatic presence across the world)
II. A state acting in Regional terms:
Most countries in the world fall in this category as they interact primarily with neighboring states
in the same geographical area (exceptionally making frequent contact with major actors for
economic issues like trade). For example, Ethiopia is a regional actor in East Africa; has trade
and economic ties with the major actors like the US and China.
III. A state acting in terms of isolationism: in the age of interdependence this has become a
less viable FP orientation. It refers to narrow FP scope of a country as a result of key weaknesses
or geographic remoteness. A good example of a state following this FP orientation can be Burma
in 1960s and 70s
3. Mode of Operation (Modus Operandi)
I. Multilateralist: these are states that chose to rely on multilateral institutions to address
different issues in their FP objectives. Most developing countries use this multilateral approach
to address many issues of concern.
Multilateral forum would enhance collective bargaining power of developing countries vs.
developed countries. In spite of power and capability, some countries may choose to use
multilateral frameworks as the best strategy to address issues with the spirit of cooperation and
peace. For example, Scandinavians and Germany are known to use this mode of operation;
II. Unilateralist: this refers to states that chose to rely on unilateral means of settling different
issues with other countries. They use carrot and stick diplomacy to affect the outcomes of events;
they use intervention, threat of use of force and sometimes force to influence the behavior of
other states. But even these states would mostly use multilateral institutions to settle problems
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 Factors that influence FP:
A. Power
Power refers to states‘ capacity to control or at least influence other states or the outcome of
events. There are two dimensions of power: Internal dimension of power which amounts to
autonomy; and capacity for action (a state is powerful to the extent that it is protected rom
outside influence or coercion while formulating and implementing policies); and External
dimension of power, which refers to the capacity to control the behavior of others; to enforce
compliance.
Power is situational; that means the resources necessary for the exercise of power change from
time to time by nature or by humans. And also, national power is dynamic not static. Power can
also be actual, potential or perceived.
There is also the concept of Fungiblity of power, which refers to the ability to change one form
of power in to another. For example, economic power can easily be changed into military power
for a state. Power might be permanent in nature or it might change in the course of time.
B. Domestic /Internal Factors

1. Elements of National Power can influence the FP for states.
These national powers can be physical factors like that of Geography, Climate, Natural
resources, and Population. It can also refer to Economic Factors which include: GDP; military
strength; technology; Investments in Foreign Land. And it also includes Political Factors that
include: military alliance and strength; Leadership and quality of diplomacy
2. Previous FP decisions of states
On the basis of the effect of past policies, there could be decision to be taken for policy
adjustment or new policies.
C. External/International Environment
International factors like that of: Regulations or International law; Structure of the system
(unipolar; bi-polar or multipolar); Policies and Actions of the other Actors; Global and Regional
Problems (like poverty, hunger, development issues, terrorism, political issues in the world;
environmental issues) are also significant factors in shaping the FP of states.
2.2.5. Instruments of Foreign Policy
Of the various types of foreign policy instruments, two of the major ones are discussed below:
diplomacy and economic instruments.
A. Diplomacy
Can be seen as a structured communication between two or more parties. It can be traced back to
at least 2500years back where envoys used to travel between neighboring civilizations. This form
of envoy exchange lacked many of the characteristics and commonalities of modern diplomacy.
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For example, there were no embassies, International law and professional diplomatic services
during ancient civilizations, however, political communities usually found ways to communicate
during peacetime. The benefits of envoy exchanges in those times was that conducting
diplomacy through envoy exchange can promote exchanges that enhance trade, culture, wealth
and knowledge.
Formally diplomacy can be defined as a process between actors (diplomats representing a state)
who exist with in a system (IR) and engage in private and public dialogue to pursue their
objectives in a peaceful manner. Diplomacy is a complex game where the goal of the practitioner
is to influence the behaviors of others according to ones‘ interests. Diplomacy is different from
FP in that Diplomacy is an instrument in FP (part of FP). A state‘s FP is a combination of the
actions and strategies that a state follows in its interaction with another state/states. This
interaction usually takes place between government personnel, through diplomacy. Interacting
without diplomacy limits a state‘s FP actions to conflict or espionage. Hence, diplomacy is an
essential tool required to operate successfully in today's international system.
The practice of diplomacy has evolved throughout its long historical development. Diplomacy in
the past, used to be practiced in a formalistic and somewhat rigid manner which was limited to
the bilateral relations of countries as being represented through the ambassadors hosted in
foreign soil. The bargaining process and other diplomatic process were the business of
ambassadors. The ambassadors acted under closed and secret manner.
The more recent type of diplomacy that is being practiced nowadays is different from the old
diplomacy in many aspects. Diplomacy nowadays, After WWI, and formation of the LON, the
old style of diplomacy has been drastically reformed. A new form of diplomacy emerged
(multilateral diplomacy; public diplomacy; summit diplomacy). In the modern context,
diplomacy is practiced mostly between states; but it also involves powerful non-state actors.
These non-state actors in IR partake in areas of diplomacy and often materially shape outcomes.
For example, International NGOs like that of Green Peace and Intergovernmental Organizations
like that of UN, and EC can shape the outcomes of diplomatic negotiations among state.
Even if the nature of diplomacy has changed somehow from the old days, the essence still
remains to be based on bargaining. Bargaining is a means of settling differences over priorities
between contestants through an exchange of proposals for mutually acceptable solutions. Some
sense of conflict is a necessity for bargaining to take place (if there is total agreement there
would be nothing to bargain about). Diplomatic bargaining is used primarily to reach
agreements, compromises and settlements where governments objectives conflict.
It involves the attempt to change the policies, actions, attitudes and objectives of other
government and their diplomats by persuasion, offering rewards, exchange concessions, or
making threats. Hence, diplomatic bargaining espouses an element of power or influence.
 Rules of Effective Diplomacy:

There are some basic rules for effective diplomacy practice:
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1. Be Realistic: have goals that match your ability
2. Be careful about what you say: plan out and weigh words carefully
3. Seek common ground: find common grounds that ends the disputes which led to the
negotiation
4. Understand the other side: appreciate an opponent‘s perspective even if you do not agree
with it
5. Be patient: being over anxious can lead to concessions (agreements) that are unwise and
may also convey weakness
6. Leave avenues of retreat open: important to leave yourself and your opponent an ‗out‘
Generally states consider using a ‗carrot and stick‘ approach for conducting diplomacy. Carrot
refers to the promise and reward; Stick refers to threats and punishments.
 Types of Diplomacy:
There are various types of diplomacies in our contemporary world. Some examples can be:
 Bilateral diplomacy: a diplomacy that is conducted between two states‘

representatives (ambassadors).
 Trilateral diplomacy: a diplomacy that is conducted between the representatives of
three states.
 Multilateral diplomacy: a diplomacy that is conducted between various states‘

representatives; usually under the umbrella of IGOs.
 Summit/ Leader to leader Diplomacy: a diplomacy that is conducted by the direct

involvement of the leaders of different states.
 Functions of Diplomacy:
 Representing state interests
 Promoting and protecting the interests of nationals
 Information gathering
 negotiation
B. Economic Instruments of FP
Modern states are politically and technologically interdependent; they rely on each other for
resources and commodities that enable them to develop and sustain viable economies. No state is
self-sufficient. There is a considerable degree of dependence upon trade among states. But this
degree of dependence varies across states. Some states are strong and capable as compared to
others. States often use their economic muscle to influence the behavior of others; use economic
instruments to achieve their FP objectives.
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Economic instruments include: tariffs, quotas, boycotts, embargos and aid. Holisti claims that
trade instruments in FP are normally used for 3 purposes:
I. to achieve any FP objective by exploiting need and dependence, and offering

economic rewards, or threat, ending or imposing economic punishments
• While using rewards or economic punishments, 2 conditions must be

fulfilled:
a) the target of the influence or act must perceive that there is a

genuine need for the reward or for the avoidance of the punishment
b) no alternative market or source of supply must be easily available

to the target
II. to increase a state‘s capability or deprive a potential enemy‘s capabilities
III. to create economic satellites (guaranteed markets and resources of supply) or

help maintain political obedience in satellites by creating a relationship of
economic dependence
• Below are a list of the most common types of economic instruments that help states to acheie
their FP goals in international relations:
1. Tariff:
• Taxing foreign products coming in to a country for the purpose of: revenue generation,
protecting domestic producers from foreign competition, or any other domestic economic
reasons.
• Tariffs can be used as an inducement or punishment
2. Quota:
• Used to control imports of some commodities.

• Foreign suppliers are allowed to send their goods in to the country at a favorable price,
but are only allowed to sell a certain amount in a given period of time
3. Boycott:
• this amounts to eliminating the import of either a specific commodity or the total range of
export products sold by the country against which the boycott is organized
4. Embargo:
• This is when a government deprives another country of good.

• When a government prohibits its own businessmen from conducting transactions with
commercial organizations in the country against which the embargo is organized.
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• It could be on specific category of goods or on the total range of goods that private
businesses normally send to the country that is being punished
5. Loans, credits and currency manipulations:
• rewards: favorable tariff rates and quotas or granting loans,
• Manipulation of currency rates can also be used to create more or less favorable terms of
trade between countries.
6. Foreign Aid:
• Foreign aid refers to the transfer of money, goods, or technical advice from donor to
recipient. The main type of aid includes: military aid, technical assistance, grants and
commodity import program and development loans. Military Aid is the oldest type of aid.
States give military aid with the objective of safeguarding their own security by
strengthening the military capabilities of allies
• Foreign aid is often used for achieving political and economic objectives of the donors. It is
not usually undertaken for solely humanitarian purposes. For example, India, Pakistan, Israel
and Egypt are large recipients because of their strategic and symbolic importance in world
politics.
• Not all aid policies and commitments have an immediate or exclusive political and security
objective. Some aid programs are also designed to achieve remedy for suffering or solve
some kind of economic catastrophe. However, economic development is seldom considered
by the donors as an end in itself; aid is thus tied with some package designed to change the
domestic or foreign policies of the recipient countries. Donors can easily manipulate
economic and military aid program to change the internal and external policies of a
government.
Chapter Four
Levels of Analysis in International Relations
Kenneth Waltz came up with levels of analysis as a method for examining IR; based on three
different ‗units of measure‘: Individual Level of Analysis, State/Unit Level of Analysis and
System Level of Analysis. These levels are associated with levels emphasizing the
characteristics, conditions and explaining world events; and relations between states.
4.1. Individual Level Analysis
This is a level of analysis in IR that focuses on identifying general characteristics of human

decision making, and the patterns in the way that humans make decisions. This includes
gathering information, establishing goals, pondering and making policy options. Decision
making is complex process that is related to human traits and organizational setting. This level of
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analysis is an approach to understanding IR that focuses on roles and impacts of particular
individual, or looks for expectations based on ‗human nature‘ or common characteristics of all
individuals.
This level of analysis analyzes humans as actors on the world stage. The human role in the
system could be addressed from three different perspectives:
A. Nature of Mankind,
B. Organizational Behavior,
C. Humans as Individuals
A. Nature of Mankind Approach
The concern of human nature perspective is how fundamental human characteristics influence
policy. Humans have limited and defective decision making abilities because they are unable
intellectually and physically to learn and process all the information required for making fully
rational decisions. Humans have emotions that wrap their judgments. These human limits apply
to political leaders as well. The limits on rational decision making could be caused by: Cognitive
factors, Psychological factors and Biological factors.
I. Cognitive Factors
Refers to the case where human necessarily make decisions within the limits of what they
consciously know and are willing to consider. Also called bounded rationality since there are
many internal and external barriers to what a decision maker knows or even can know. Internal
boundaries for cognitive limits on decision makers Intellectual and Physical limits. No decision
maker has the vast intellectual or physical capacity to analyze completely the mass and
complexity of the information that is available.
Emotions are the other internal boundaries for cognitive factors. This is so because people
regularly ignore unwelcome information or reject a policy object that they find emotionally
unacceptable.
External boundaries that affect the cognitive capacity of human beings include factors like
missing information and inability of any decision maker to know for sure what decision makers
in another country are thinking or how they will react to various policy options.
II. Psychological Factors
Human behaviors and limits of rationality are guided by certain psychological theories.
Psychological traits help to explain political behavior. Frustration- Aggression theory is an
example of a psychological theory that claims that frustrated societies sometime become
collectively aggressive.
III. Biological Factors
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Human behavior and rationality are governed and explained by biological theories. Nature verses
Nurture: the degree to which human actions are based on animal instincts and other innate
emotional and physical drives (nature) or based on socialization and intellect (nurture) amount to
biological factors that can influence the individual‘s decision. Bio-politics is another biological
factor that tries to link political and physical nature of human beings. Cultural environmental and
genetics determine behavior of bio politics.
There are a number of bio-political approaches that can be illustrated by examining ethology and
gender. Ethology studies animal behavior and draws similarities with human behavior. For
example, territoriality- the drive to gain, maintain and defend the right to property is considered
as a biological theory that can be taken to explain political behavior of individuals.
Gender is also another biological factor that has an influence on how people make decisions and
understand different circumstances. Differences in behavior on bases of gender are also linked to
process of decision making in world politics. The gender difference in political attitudes and
actions due to behavior is learned rather than instinctual. For example, power seeking is taken as
a particular male sexual impulse.
B. Organizational Behavior
This approach tries to examine how people act in organizations. The pressure of positions and
the dynamics of group interaction affects how one behaves. The behavior of human in a group is
related to the nature of human being rather than politics.
There are different factors that determine how human beings behave in organizational settings.
These factors include: role factor; and group decision making factor.
I. Role factor:
Roles are attitudes and behaviors that we adopt depending on the position we hold. Roles
influence how you think; how you act varies depending on whether you are in class, on a job or
in a family situation.
Decision makers play a definite role on the basis of what others expect out of them and what they
want to project not personally but as leaders. Self-expectations are one important source of role.
Behavior in a given position is based partly on what an individual expects of him/herself.
Expectations of others are the second important source of role behavior. We behave in certain
way because what others expect of us in a particular role.
II. Group Decision Making Behavior
People behave differently in organizations than they would act if they were alone. In
organizational decision making there is a high tendency towards groupthink. Primary cause of
group think are: the pressure within decision making groups to achieve consensus. Group think
creates an atmosphere in which discordant information or devise is rejected or ignored. Those
who dissent are at risk of rejection by the group and its leaders.
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C. Humans as Individual Approach
This approach assumes that characteristics of leaders have a great role in decision making and
different leaders may take different decisions under similar conditions. Decisions are guide by
individual traits of leaders. Studies of psychology, biography and motivations of decision makers
using sophisticated methodologies are made to unravel the basic views of leaders as they see the
world. Psychological history of leaders is given due consideration.
4.2. State level Analysis/ Unit Level Analysis
Both state and system level analysis recognize that states have long been and continue to be the
most powerful actors on the world stage. However the two are different as state level contends
that states are relatively free to decide what policies to follow; while the system level assumes
that the international system pressures states to behave in certain ways.
This level of analysis is an analytical approach to IR focusing on the domestic or internal causes
of state actions. Attempts to explain IR by emphasizing the internal workings of the state itself.
The internal forces affecting the policies of a state are part of a nation‘s political culture and are
referred to as a country‘s internal political actors. The forces in the states interact affecting the
foreign policy of states: FP making is subject to the political system, situations and issues
prevailing in the nation.
4.2.1. The State, Nation and Government
State is an abstract entity encompassing four major elements: population, sovereignty,

government and defined territory. If one is missing, then there is no state.
Nation is a cultural term, referring to a group of people who identify with each other on the basis
of commonality of characters like shared history, language, culture, religion and race. The
demarcation between ethnic group and nation is not well defined. However, a nation has real or
potential political aspirations.
Government is often considered that a state‘s regime type can dictate the way that state interacts
with others in the international system. For example, in democratic peace theory, it is assumed
that democratic governments will not go to war with each other. Democracies externalize their
norms and only go to war for just causes; democracy encourages mutual trust and respect. Or in
Communism; a world revolution is justifiable as it would lead to peaceful coexistence based on a
proletarian global society.
4.2.2. Foreign Policy and Domestic Political System
The making of FP is less singular (it is not something that is usually made by presidents, prime
ministers or dictators). Even presidents, prime ministers or dictators are not totally free to decide
policy. The decisions are taken under constraints of human facts operating ‗murderously
complex‘ web of governmental and social constraints that make up a modern state.
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There is no single FP process. There are multiple processes. And so the question is, what decides
FPs? The answer to this is: the type of domestic political system, the intensity of situations and
the nature of issues.
A. Domestic Political Systems:
Domestic political systems can be classified in to:
i. Democratic system: many participate with extensive rights to oppose and compete
for power.
• HR, secularism prevail; supremacy of the constitution and sovereignty of

people respected.
ii. Undemocratic systems: only few can participate in the decision making process;
• Rights of people are minimal to oppose policy or compete for power.
B. Policy issues and Situations
FP making varies under varied nature of situations.
i. Policies during Crisis:

• During crisis, policy makers are surprised by events, feel threatened and
have a short time to make the decision.
• Such decisions are made by inner few among leadership and the decisions
strive to take rationality under the command of leader.
ii. Innovative policy:

• Significantly changes the direction of policy, evokes dissent (opposition)
and involves wider sub national actors
iii. Consensual policy:

• confers decisions passed on entrenched (deep-rooted) principles
iv. Incremental policy:

• Changes causing less dissent (opposition). Decisions conform or nearly
conform to past practice,
• Such policies are not made by political leaders alone but at time by
bureaucratic actors.
C. Political Culture
Political culture or the history and value affects the FP of a state. The political culture is an
imprecise term referring to long term fundamental practices and attitudes. Political culture does
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not make specific policy but is suitable to apply pressure to take a given line of policy. Political
culture can be divided into national attitudes about:
– 1. protecting and enhancing national territory and population

– 2. creating and maintaining world order
– 3. Projecting values and converting others.
D. Religion
Religion can have an effect on the way a state acts within the international system. Religion is
visible as an organizing principle particularly of Islamic states, where as secularism sits at the
other end of the spectrum with the separation of state and religion being responsible for the
liberal tradition.
4.3. The System Level Analysis
Formulation of FP is partly accomplished outside the state dealing with realities of world system
and helplessness of countries under stress. The international system influences states on merit of
its power. Less powerful states are affected than powerful states. This level of analysis attempts
to explain international relations by focusing on the structure of international system (global
distribution of resources among states).How it shapes or constrains the action of state.
IR can be explained by factors that influence the system as a whole and by characteristics and
proclivities (tendencies) of the system itself.
4.3.1. What is the system level overall?
We are all part of many overlapping systems that influence our behaviour. These systems range
from very local like family and school classroom too much larger and seemingly more remote
systems like that of a country and the world. System is a complex combination of interdependent
parts that relate in a manner that causes a change in one part to influence other parts. This
approach is a top down approach to studying world politics in which countries and other actors in
a global social, political, economic and geographic environment and specific characteristics of
the system helps to understand the pattern of interaction among the actors.
This level of analysis believes that any system operates in somewhat predictable way (that there
are behavioural tendencies that the actor countries usually follow.) System is also used very
loosely, as little more than a synonym to ―environment in which states operate‘.
Two conditions need to be met for the system to exist:
– One cannot infer the outcomes from the attribute and behaviour of the actors‘
alone. Iinterconnections are present (with the result that changes in some parts of
the system produce changes in other parts.) These two conditions lead to the
major characteristic feature of systems
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– The consequence of the behaviour of states are not expected or intended by the
actors.
In a system, the whole is different from the sum of its parts. This is to imply that complete
knowledge of actors (their characteristics their goal and their intention) do not allow
understanding the system.
 How is the whole different from the sum of the parts?
The whole might be symmetric, that is equal or horizontal in spite of its parts being
asymmetric or horizontal or vertical. The whole might be unstable in spite of its parts are
stable in themselves. A system may be unipolar, bipolar or even multi-polar but actors
cannot be. A system cannot be described by adding up the policies of individual states or
summing up their bilateral relations.
4.3.2. Interconnectedness and unintended consequences
A system is interconnected. Whether actors ally with or oppose each other is influenced by
factors outside of their bilateral relationship. Events in one area influence other areas. Changes in
relations between two states lead to alternations in the relation between other states.
Interconnectedness is the relation between two actors depends in part on the relations between
each of those actors and other actors in the system.
Systems vary in how interconnected they are. Everything is interconnected but some things are
more interconnected than others. This means a great power is more tightly interconnected to
larger number of other states than is small power because it has involvement all over the world.
For example, conflict between Ethiopia and Somalia would not affect a small power country like
that of Lesotho or Burundi. But it sure will affect a big power like the USA. Many
interconnections are not direct but involve links through regional powers or great powers. For
example, although most states had no direct concern in Vietnam, they were affected by what
happened there because of changes in USA policy that the war produced. The US did not
anticipate that it would be defeated. The US pull back from being a policeman, took the lead off
the local conflicts and encouraged regional powers to play a great role.
4.4. System Level Actors
Systems range from very local ones like family and school classroom to much larger systems
such as a country and the world.
 All systems operate based on four factors:
1. Structural Organization
All systems have identifiable structural characteristics. These include:
I. Authority organization: the international system has a horizontal authority

structure.
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• States are sovereign; do not answer to anyone in the international system:
hence the international system is anarchic
– The authority structure is changing now though. This is because

sovereignty is declining. We can observe that even the most
powerful states are subject to an increasing number of authoritative
rules marked by international organizations and by international
law. Countries are no longer totally free to make internal policy on
even purely domestic matters.
II. Actors: national actors (states) and super national actors
III. Scope and Level of Interaction: scope and level of international interactions are
very much higher now than were during the 1800s or even in the first half of the
1900s. Current international system is characterized by growing interdependence;
mutual responsibility and dependency on others.
2. Power Relationship
The distribution of power within a system affects the way the system operates. Polarity in IR
refers to the arrangement of power within the international system. The pattern of interaction
varies in the international system according to the number of power poles. As a result, we have a
world system where there could be a unipolar, bipolar or multipolar power structure and
relationship.
3. Economic Patterns
Economic interdependence is one pattern that affects the international system. The operation of
the international system is in part the product of its economic patterns. We can understand it
better if we look at the impacts of these patterns by seeing interdependence, natural resource
location and use and mal distribution of development. The pattern of where natural resources are
produced and consumed also influences the operation of the system. The mal distribution of
development is another economic pattern that has influence on the international system.
4. Norms of Behavior
Systems develop norms for two reasons:
i. Various psychological and social actors prompt humans to adopt values to define what is
ethical and moral.
ii. Humans tend to favor regularized patterns of behavior because of the need to interact
and to avoid anxiety and disruption caused by unwanted behavior of others
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Chapter Five
International Organizations
5.1. Characteristics and Classifications of IGOs
IGOs are institutions which are established by two or more states. They are organizations which
have two or more member states. But not all IGOs are created by states. Sometimes, IGOs
themselves can create and/or be a member of an IGO. For example, EC (European Commission)
is a member of the FAO, and a founding member of the WTO.
IOs act under a constituent instrument such as treaty, charter or covenant. These documents set
forth: the purposes and functions of the organization, the structure and decision making process
of the organizations, provisions for regular meetings, a permanent headquarters and staff
organization.
States often take actions though, within or in the context of IGOs whose members are national
governments.
 Essential characteristics of IOs:
A. Membership:
An IO should draw its membership from two or more sovereign states. Though membership
need not be limited to states or official state representatives
B. Aim:
The organization is established with the aim of pursuing the common interests of all the
members. It may end up not undertaking this task or favoring the interest of one member
over that of another, but it should not have the express aim of pursuit of the interests of only
one member, regardless of the desires of others.
C. Structure:
The organization should have its own formal structure and continuous nature established by
an agreement such as a treaty or constituent document.
The nature of the formal structure may vary from organization to organization, but it should
be separate from the continued control of one member. It is this autonomous structure that
differentiates number of international organizations from a series of conferences or
congresses.
IOs can get into treaties like that of states. For example, UN has entered into a treaty with USA,
to establish it‘s headquarter in New York. But this doesn‘t mean that IOs have the same status as
states in the international system.
And so how are IOs different from States? IOs are the creation of states and their powers are
limited to the powers that the constituting states have given them. States have privileges and
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immunities that are general whereas IOs have only such privileges and immunities as are
necessary to carry out the organization's functions. An IO cannot invoke ‗sovereign immunity‘
(immunity from liability in foreign courts in cases involving official acts) because an IO is not a
sovereign. Only states can appear before the ICJ in contentious cases. IOs have to resort to other
international tribunals to resolve their disputes.
5.1.2. Classification of IOs
A. Classification Based on Membership: Universalism vs Regionalism
 Universal/Global IOs: IOs which all interested parties can join.
• Also known as open IOs: There are universal organizations which have
membership drawn from practically all the sovereign states in the world (EG: UN,
WHO, WTO).
 Regional/Limited IOs: IOs with limited kind of membership (specifically designed to

exclude some countries).
• The limit may be geographical as in the case of:

• EU, AU, IGAD, COMESA etc;
• Or the limit can be based on other criteria as in the case of:
• OPEC (a limited organization with membership that spans the globe

including the Middle east, Latin America and Africa) or;
• OECD (Organization for Economic Cooperation and Development:

members from Western Europe, Americas, Asia and Oceania) or;
• NATO (the members are drawn from Western and Southern Europe and
USA and Canada.
• Francophone: unified French speaking states
B. Classification based on Functions: Aims and Activities
Most IOs usually have their aims stated in the basic document by which they have been
established. This doesn't mean that the organization would not have other aims except the ones
stated in the establishing document. Other aims could be included as further treaties between the
member states etc.
IOs cover a huge range of issue areas. Issues include: peace and security, human rights,
International economic issues, international environmental issues, nutrition, public health and
telecommunications or fisheries conservation, the coordination of international aviation or
broadcast standards etc.
Based on their activities IOs can be divided into:
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i. Political organizations- those concerned with the preservation of international peace and
security.
ii. Administrative organizations- those having more limited aims that the political
organizations.
However, based on their activities, states IOs are further classified into different other types of
classifications by different scholars as well.
C. Classification based on the nature of decision: Intergovernmental or Supranational

 Supranational IOs: IOs with the power to bind member states by their decisions.
The EC is said to be a good example of a supranational IO. This is because EC possess a

few features that distinguish it from other IOs. These features are:
1) Based on majority vote, binding decisions can be passed over member states.
2) EC law attains supremacy over conflicting domestic law regardless of what

the laws of the member state stipulate and regardless of which one was
enacted later.
3) EC law may be directly effective in legal orders of the member state against
his or her own government or in relations with employers or other relations of
private nature.
 Because of these factors, some people argue that EC members have transferred parts of
their sovereignty to EC.
 Intergovernmental IOs: IOs that cannot make binding decisions upon their member states.
5.2. Roles of IOs
1. Instrument: IOs are taken to be instruments for the policies of individual governments,
means for the diplomacy of a number of states.
• Myrdal: IOs are used by nations primarily as selective instruments for gaining
foreign policy objectives.
• EG: UN in its first 8 years of existence is often characterized as being an

instrument of US diplomacy.
2. Arena: IOs can be arenas within which actions take place.
• The IOs provide a meeting place for members to come together to discuss, argue,
cooperate or disagree.
• Arenas in themselves are neutral: they can be used for a play, a circus or a fight.
3. Actor: IOs are autonomous actors in the international system.
5.3. Functions of IOs
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At present IOs perform many functions and their functions are constantly increasing. Some of
their functions include:
1. Articulation and aggregation: IOs perform the task of interest articulation and
aggregation in international affairs just as national associations of likeminded
people do within a national political system.
• EG: OPEC in the mid-late 1970s behaved like an oil exporters‘ trade
union
2. Norms: IO chargers and treaties provide a set of values for the international
system.
• EG: UN charter provides the following values in its preamble: ―we the
people reaffirmed their faith in fundamental human rights, in equal rights
of men and women and of nations large and small and determined to
promote social progress and better standards of life in larger freedom. In
its chapter 1, the charter it provides the principles of international law,
peaceful settlement and international cooperation.
3. Recruitment: IOs have an important function in the recruitment of participants in
the international political system.
Other functions of IOs include but are not limited to: Socialization, Rule making, Rule
application, Rule adjudication and so on.
5.4. Approaches to IOs
There are a number of different ways in which one can approach the phenomenon of IOs within
the world order:
A. The Rationalist Approach:
This approach emphasizes the notion of a world order of states that is moving towards the more
sophisticated types of orders found within states. It is progressive in that it believes in the
transformation of society of sates into a true world community based upon the application of
universally moral and legal principles. IOs have a profound substantive as well as procedural
purpose, and are intended to function above and beyond mere administrative convenience. The
rationalists emphasis the role of such institutions as active performers upon the world stage
rather than a mechanisms to greater efficiency.
B. The Revolutionary Approach:
According to this approach, the primary aim of IOs is not the evolution of a world community of
states based upon global associations as perceived by the rationalists, but rather the utilization of
such intuitions as a means of attaining the final objective whether it be the victory of the
proletariat or the rearrangement of existing states into for example continental units
C. The Doctrine of Realism:

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This approach centers its attention on the struggle for power and supremacy and eschews any
concern for idealistic views. The world stage is seen as a constant and almost chaotic
interweaving of contentious state powers, and international institutions are examined within the
context of the search for dominance. Both the LON and the UN were created to reinforce the
status-quo established after the world wars, it is stressed although the later institution is now seen
as reflecting the new balance of power achieved within the growth of influence of the states of
the 3rd world.
Realists see the role of the IOs as reinforcing that balance and enabling it to be safely and
gradually altered in the light of changing patterns of power; although to be accurate, their overall
attitude to such IOs is usually characterized by cynicism, as the inherent weaknesses in these
organization have become apparent.
D. The Functional Approach:
This approach is a more hopeful way of looking at the IOs. It concentrates upon those areas
where the interdependence of states has impelled them to crate viable organs for cooperation.
This approach is a cross between the nationalist and the realist trends and is one much examined
in recent years.
It emphasizes the pattern of intuitional behavior and the operations of the relevant bureaucracies,
including the way in which the tasks set for the organization are identified and completed.
Decision making analysis is another useful tool in this area.
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COURSE 6: POLITICAL SYSTEMS AND GOVERNANCE IN
ETHIOPIAN
CHAPTER ONE
INTRODUCTION
Different societies throughout the world attained their present political economic and social
forms under the framework of the modern state after going through different historical
experiences. Apart from sharing comparably broad trajectories not all of these societies
experience similar historical patterns and process. However, at conceptual level, there are some
common features shared among the otherwise unique historical experiences throughout the
world.
State formation is not a once-and-for-all process nor did a state develop in just one place and
then spread elsewhere. In addition, state formation can hardly be considered as over. It has been
invented many times, had its ups and downs, and seen recurrent cycles of centralization and
decentralization, territorialization and deterritorialization. This is mainly because the process of
state formation, as it has been happening throughout the world, is characterized often by
contradictory process of conflicts, negotiations and compromises between different groups in a
way of achieving an integrated existence as a national unit on the basis of certain political project
around a power center which is an instrument of hegemony and constituted by one or several
dominant classes occupying the heart of the process and drive it as a whole.
The end goal of the process is to build a centralized state organization accompanied by effective
control of territories and communities by eliminating or subordinating number of semi-
autonomous authorities to a centralizing political project which is championed by the hegemonic
center.
The end goal of achieving integrated existence by the process of state formation or the challenge
or inability to do so is dependent on the two interrelated elements: nation-building and state-
building.
The notion of state building is related to the question of how to organize political power around a
power center either by restructuring old institutions or introducing new political institutions and
legal frameworks. It focuses primarily on public institutions-the machinery
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of the state, from courts and legislatures to laws and bureaucrats. Historically, state-building
proceed from an initial deployment of force and coercion to achieve centralization. Once a
structure for centralization is put in place state-building would require an institutional buildup to
enhance state capacity. Incapacity to maintain effective centralization of power over society and
stalled institutional capacity would constitute state fragility and/or state failure. The success or
failure of a state-building process, which combines force and institutions, is measured by the
degree of the effectiveness of political power in state-society relation. This is, however, one
component of the problematic of political power.
The other component of the problematic of political power revolves around the question of what
to do with that power. The achievements of political power in this sense are measured against
better performance in terms of economic development, national unity, democracy, poverty
reduction and security promotion etc. Success or failure in this regard is dependent on multiple
sets of factors. One such factor is the process of nation-building.
The concept of nation-building looks into the political processes that aim at bringing social
solidarity and loyalty around the state institutions, territory and common interests. The success or
failure of nation-building is measured in terms of the degree of legitimacy the government has in
the eye of the society. It implies the strengthening of a national population‘s collective identity,
including its sense of national distinctiveness and unity. As such it involves a great number of
processes – social, institutional, intellectual, ideological, and political. As a result the issues at
stake are somewhat greater and more complex than state-building.
However, the concept of national-building is far more contested than state-building. From a
conceptual and normative point of view nation-building is considered to be important to the
extent that it facilitate broad based inclusion and social cohesion. A political power uncontested
by crippling social, mainly identity based, cleavages would theoretically free the state to pursue
the goals of societal transformation and betterment. Yet, for students of political science the
practise of nation-building process are far less consistent with the ideal mentioned above.
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Nation-building as deliberate efforts to construct an over-reaching collective identity based on a
assumed common national sentiment, culture and heritage would not necessarily create an
unencumbered foundation for political power.
In reality especially in the context of a diversified society state power tend to be dominated by a
hegemonic group or groups. This group has particularized social ethnic religious and class
compositions. In this context nation-building projects could still be pursued to keep the
advantages of the hegemonic group in power. In this context the question of what to do with
political power would be less about societal transformation and betterment.
Modern Ethiopian State Formation and the Politics of “History”
The process of modern Ethiopian state formation begins since the second half of in the 19th
century. Yet it is important to briefly look at the patterns of history and interaction before the
19th century. The pattern of history and interaction in and among the different components of the
peoples and societies that constitute the present day Ethiopia before the unfolding of the modern
state in Ethiopia could give us a sense of the general historical background that led to the 19th
century modern state formation.
Modern political historians assert that Ethiopia attained its contemporary form in a strict
territorial sense out of the background of two roughly broad and distinguishable ‗socio-political‘
categories. It is usually an accepted fact that the process of state formation that drove the two
categories into more or less unified political unit begun in 19th century. However, interperating
what had been accomplished since the 19th century in light of the pre 19th century background is
in fact a matter of huge political controversy. In fact the issue of state formation is one of the
major issues of the political fault line among the country‘s elites since the 1960s on.
Academicians and politicians alike have never settled the question of ―the politics of history‖ in
Ethiopia. The history of state formation in Ethiopia is a source of profound, even bitter
contention.
There are disagreements among historians and others as to what should be the appropriate
framework of analyzing the modern Ethiopian state in connection to the extent of the pre 19th
century interaction between these categories. The Aksumite Paradigm (aka Pan-
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Ethiopian Nationalist) and the Colonial Thesis (aka radical ethno nationalist) represent the two
extremes. Greater Ethiopia School of Thought and its variant: Nation building perspectives
represent the middle ground.
The Aksumite Paradigm (Pan-Ethiopian nationalists)
Pan-Ethiopian nationalists contend that the Ethiopian state maintained a continuous political
existence for 3,000 years. According to this perspective the Ethiopian state has existed for
millennia, building a distinct national identity.
Ethiopian nationalism is a historically verifiable reality, not a myth. It has successfully countered
ethnic and regional challenges. The state had its core in the northern part of the country radiating
southwards to sufficiently assimilate different cultures which made the creation of the Ethiopian
nation possible. For this perspective, Ethiopia is the melting pot par excellence.
Its image is one of Ethiopia as a nation-state. According to one proponent of this view ―the
Ethiopian ruling classes cannot be identified with a particular ethnic group. They are a multi-
ethnic group whose only common factors are that they are Christians, Amharic speakers, and
claim lineage to the Solomonic line‖. The central theme of Ethiopian history according to this
paradigm has been the maintenance of a culture core which has adapted itself to the exigencies of
time and place, assimilating diverse people.
The Colonial Thesis (Radical ethno nationalist)
At the other extreme, radical ethno nationalists advance a ‗colonial thesis‘ claiming that
Abyssinia (central and northern Ethiopia, the historic core of Ethiopian polity) ‗colonized‘
roughly half the territories and peoples to form a colonial empire-state in the last quarter of the
19th century.
Radical ethno nationalist maintain that ―the modern empire was created only during the last 100
years as a result of the rapid southward military expansion of the Amhara rulers of Showa. From
the radical ethno nationalist vantage point, Ethiopia is a colonial empire that
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needs to undergo decolonization where "ethno national" colonies become independent states.
Its image is one of Ethiopia as a colonial-state.
The ‗colonial thesis contends that modern Ethiopia is an ‗invention‘ of the ‗Abyssinian core‘ or
specifically ‗the Amhara-Tigre coalition‘, and that the ‗northern‘ and other ‗southern‘ peoples
have always been separate historically, politically, and culturally. It follows that these two
entities must be treated distinctly.
For the radical ethno-nationalists Ethiopia as a colonizer is no more different than Europeans as
colonizers of Africa. Proponents of such a thesis, however, make a distinction that ―Ethiopian
colonial rule differs from a Western colonial power in that Ethiopian colonial power was
centered in the country itself and not in some distant metropole. The rulers were also ‗natives‘,
and did not have immense technological superiority over the ruled nor enjoyed vastly superior
standard of living.
The Greater Ethiopia School of Thought (GEST)
The above two perspectives differ in so fundamental ways. One such glaring difference is over
the relevance of ―history‖. For the pan-Ethiopian school the so called ‗south‘ and ‗north‘
distinction is an exception to the rule. Ethiopia maintained long unified existence as a nation-
state. The colonial school for its part dismiss any kind of relation let alone political between the
so called ‗south‘ and ‗north‘ categories in pre 19th century hence making the empire state
created after the 19th century as the colonizer of alien people by an alien force.
The Greater Ethiopia Perspective advances the idea that the 19th century process of modern
Ethiopian state formation was preceded by long process of socio-cultural developments that
contradict both a nation-state interpretation and a colonial interpretation of the 19th century state
formation. It claims that all peoples of Greater Ethiopia shared similar cultural elements through
long persisting and complex web of inter-relationships. However, these inter-relationships were
not thoroughly complete to characterize Greater Ethiopia as a full-blown nation-state.
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Similarly, the degree of interaction among the different people of Greater Ethiopia was too
multifaceted and too strong to accept the emergence of modern Ethiopia as a colonial empire-
state.
Accordingly, modern Ethiopian state formation should be seen as a process of bringing together
different peoples of Greater Ethiopia who share deep seated historical relations in the context of
loose political framework under strong political and territorial centralization. Even before the
peoples of greater Ethiopia came under a strong political center strong interactions were made
possible by long distance trade that traversed different areas, war, migration, marriage, the
expansion of Christianity and Islam and the Oromo expansion.
Ethiopia‘s essential ‗national unity‘ is founded on three interconnected factors. Firstly, the
continuous process of interaction among the different people of Ethiopia. Secondly, the existence
of commonly shared distinct pan-Ethiopian cultures that cut-across the different peoples of
Greater Ethiopia. Finally, the different people of Greater Ethiopia have stood together to resist
and defend any foreign interference.
For the Greater Ethiopia School of thought modern Ethiopia is a continuation of Greater Ethiopia
which existed for a very long time as a cultural zone among the different peoples who share pan-
Ethiopian cultures and traditions above and beyond the differences of particular and localized
cultural expressions connected by a network of loose interaction. In general, it views Ethiopia as
a historically evolving multi-ethnic society. The 19th century modern state formation was the
commencement of a non-colonial empire state-building process awaiting a nation-building
procces.
Its image of Ethiopia is a non-colonial empire-state. For this school of thought the ancient
Ethiopian state, short-term contractions in size notwithstanding, expanded, over a long historical
period, through the conquest and incorporation of adjoining kingdoms, principalities, sultanates,
etc., as indeed most states in the world were formed.
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The Nation-building School of thought
Like Greater Ethiopia school it accepts the image of modern Ethiopia as a non-colonial empire-
state. However, it argues that a discussion on the 19th century modern Ethiopian state formation
should take into consideration a distinction between two broad and distinct socio-political
categories with relatively semi-autonomous existence in the northern part of present day Ethiopia
on the one hand and southern, south western and south eastern Ethiopia on the other. For the
sake of connivance Baharu Zewde, a prominent modern Ethiopian historian, categorized these as
―northern principalities‖ and ―states and peoples of southern Ethiopia‖ respectively.
The nation-building school does not accept pre-19th century Greater Ethiopia as a cultural zone
that achieved essential ‗unity‘ as is often claimed by GEST. Nevertheless it maintained that there
were linkages between the so called ‗north‘ and ‗south‘ sustained by the existence of long-
distance trade that created a unity of interest between ancient ‗Northern‘ state of two or three
millennia and the different peoples and societies that later in the second half of the 19th century
constitute the modern state of Ethiopia.
The nation-building school of thought tries to balance the historical interactions that broadly
unite the ‗north‘ and ‗south‘ with the distinct patterns of their history that characterised their
political and cultural heterogeneity. The proponents of the nation-building school categories
those who directly engage in the imperial politics of zemene mesafint as ―northern
principalities‖. Conversely, those who did not participate, at least politically, or were relatively
peripheral to the imperial politics of zemene mesafint are designated as ―states and peoples of
southern Ethiopia‖.
In summary, the disagreements among academicians and/or politicians over the place of ‗history‘
run in a continuum where the Pan-Ethiopian view and the Colonial thesis taking diametrically
opposing views. In between are the Greater-Ethiopia and the Nation-building Schools of
thoughts that incline to but moderate the take of the Pan-Ethiopian School and the Colonial
Thesis respectively.
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PATTERNS OF POLITICAL HISTORY IN THE NORTH
The Traditional Northern Polity and Society
What for the sake of convince is labeled as the ‗north‘ in Ethiopia represented a distinct form of
society and culture commonly (though not necessarily accurately) known as ‗Abyssinia‘.
Geographically, it included those territories and societies which over centuries trace their
political existence from the Aksum civilization (in Tigray, Eritrea Wollo, Gojjam, Gonder and
Shewa,) and the Christian religion which the society inherited from the Aksumite period. Here
the Amharic-Tigre languages have been the dominant cultural elements that long give degree of
homogeneity to the northern category.
Through many centuries of experience the northern society institutionalized Christianity by

incorporating into it a wide variety of indigenous elements giving it a peculiar form that has long
been different from the world Christianity. In fact, Teshale Tibebu in his comparison of
Ethiopian Christianity with other versions of the world Christendom calls the former Tabbot
Christianity which incorporates aspects of Judaism as well. Tabbot Christianity as practiced in
Ethiopia gives emphasis to the observation of Saturday as Sabbath, the symbolization of the
Tabbot as representative of the church and distinction of clean and unclean food. These three
aspects are to be found nowhere in any of the other world Christianity versions.
In the traditional Northern society the place of Christianity was mainly profound in the political
fabric of the society as well. The Christian church assumed a prominent political position. The
Christian church and the state formed a union and a national ideology. This union served
important goals. The church articulated a traditional basis for legitimizing the authority of the
state. This can be observed from the Kebre Negest (Glory of Kings). The document was
originally prepared by the church and traced the origin of the Ethiopia state from King Solomon
of the Biblical Israel by depicting the first Ethiopian king in the name of Menilke I who was,
according to the document, the son of King Solomon. As king Solomon, according to the Bible is
a God chosen king, the document dictates that the Ethiopian rule system is an extension of God‘s
will. Practically, what the document established was a system of legitimacy that was religiously
conceived for benefit of rulers. To the northern
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society, what the document did was to unit Christianity, the Ethiopian nation and the so called
‗Solomonic dynasty‘ beyond human challenge.
NB. The ‗Solomonic dynasty‘ as the legitimate dynastic line for Ethiopian kings was so strong
that Ethiopian kings until 1974 had to establish a blood tie with it to assume the kingship. The
idea of the ‗Solomonic dynasty‘ also served as an ideological justification for expansionist
tendencies of traditional Abyssinia ruling groups by putting Christianity as ‗divinely‘ placed
‗mission‘ and ‗criteria‘ for assimilation of non–Northern groups.
Church and state
In the traditional northern society, the Christian church and state linked in an interdependent and
reinforcing manner.
Firstly, at least theoretically, the legitimacy of a particular candidate for the throne requires the
existence of some ‗blood‘ connection with the so called Solomonic‘ line. As this was formulated
in the religions terms, it gave the church an authority over the throne. For instance, the church
codified the Feta Negest (Law of king) which stipulates acceptable ways of conduct by
emperors. Accordingly, the church can challenge the legitimacy of the emperors‘ on charges of
religious heresy to the extent of excommunicating the emperors and weaken their legitimacy on
the eyes of the Christian society. Secondly, and practically, however, the church was subservient
to the state or the emperors and in fact for long period it served as an appendage of the state.
One reason was the fact that the church was dependent on the state for its economic wellbeing.
Another was for centuries the church was known for lacking central administration and had been
caught in by doctrinal differences. This made it divided and dependent on the support of the state
power.
For its part, the church legitimatizes the authority of rulers for the economic support they
provided. By drawing the emperors as extensions of God‘s ultimate power, it gave the kings
unlimited power over every subordinate level of political authority and to exercise exclusive
prerogative over appointment and dismissal of individuals.
The regional nobility
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However, Ethiopian emperors had not always been practically absolute as their relationship with
the church seemed to imply. Their quest for absolute power has been constrained by different
issues. Firstly, the ruler had not all the means and structure to control the day to day
administration of the state. Much more than the kings, the regional nobility had been better
placed for this task. The nobility, by calming blood relationship or hereditary rights over a
territory did exercise control over their locality.
Traditionally, the nobilities‘ authority in their domain included traditional rights to collect tribute
and possess own army which they could use to strengthen their local power base. Although the
emperor had a theoretical right to revoke the status, power and privilege of the nobility, it had
never been easy to do so. In fact, the relationship between the king and the different regional
nobilities in the traditional Northern society had been a struggle for ascendancy over one
another.
In the traditional Northern society administrative structures were traditionally divided on

historically based geographical constituents. Although higher official to this units were appointed
by the king the lower but numerous official were appointed by the regional nobility. In facts
those higher official were hardly the emperor‘s own choices. The king practically was forced to
choose official from among the leading regional nobility who had a traditional source of
authority (such as hereditary claims) which the king could not totally ignore.
The position of the regional nobility was further strengthened by its traditionally conferred
responsibility on its regional domain to maintain law and order, collect tribute and maintain their
own soldiers. Although the nobility was expected to pass a portion of tax collected to the king,
they practically maintained it for themselves and distributed it among their local dependents
(such as soldiers) to buy their loyalty. In fact, the nobility had an immediate and effective power
over the peasantry than the relatively distant king.
However, the emperors had always tried to expend their power over the nobility in different
ways. The frequent use of shum-shir to prevent the strengthening of particular nobility for longer
period over a particular area was one method. Through shum-shur the emperors tried
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to instill inter-nobility rivalry. The kings also alternatively arranged dynastic marriages to secure
the loyalty of powerful nobilities. In fact, Ethiopian kings used roving capitals to effectively
assert imperial authority throughout the country militarily wherever imperial authority was
challenged by provincial (regional nobility).
However, before the emergence of the modern bureaucratic state in the early 20th centuy for
much of the historical period in the Northern society the regional nobility‘s power was relatively
unconstrained by the king. Geography had its role. The internal geography of northern Ethiopia,
marked for its rough mountainous setting, least navigable rivers and extended rainy seasons
compounded by technological limitations, made provisional districts (and their regional rulers)
relatively inaccessible for effective imperial control.
Even if generically called ‗northern principalities‘ historically the northern society was
characterized as having developed strong tendencies of provincialism with host of parochial
identities, sectional loyalties and locally vested interests. The Northern society has been
inhabited by specific groups occupying specific regions nurturing a passionate attachment and a
desire to defend self-rule with particular economic and political interest collectively under the
leadership of the local nobility. However, this kind of provincialism did not eliminate the
tradition to accept the general over lordship of the king at the top. This tradition supported a
higher integration among the major northern provincial units (which included Tigriay, Gojjam,
Shewa, Gonder, Wollo). Higher integration was kept desirable in the Northern society in spite of
the prevalence of narrower provincialism for two main reasons. First, stronger nobilities wanted
to achieve integration of their small units to become stronger and resist an encroachment from
the monarchy. Secondly, and as a result of the first reason local nobilities wanted to compete for
the throne themselves.
In spite of the prevalence of provincialism in the northern society it was those main factors that
condense the Northern society into its broadest designation as Amhara-Tigray pair. The former
was divided along defined provincial units as Shewa, Gojam, Gonder, Wollo where language
similarity could not cut across narrower provincial inclination with each of these so called
Amhara groups. For instance Shewa lacked a distinct identity and provincial
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consciousness and its self-image dissolved into smaller components such as Tugulet, Menz, and
the like accounting for its heterogeneous composition. In addition, the region Shewa has been
predominantly a home to non-Amhara groups like Oromos and Gurages.
Distinctiveness of Tigray provincialism was reinforced by the preservation of distinct language

and a belief that it represents the ‗purity‘ and continuity of the Aksumite culture and society than
the admixture Amhara.
In general, until the 19th century the northern society had undergone through the struggle
between centrifugal tendencies (represented by regional nobility) and the drive towards
centralization (represented by the monarchy). The role of the Orthodox Church in these
competitions had been to side with the relatively stronger side which could secure to the church
institution and its functionaries (the clergy) a constant provision of wellbeing and support to its
existence and privileged position in the society. The upper hand of the former was seen in its
pick during the Zemene Mesafint which delayed the process of integration in Northern society
until the coming of Tewodros II who brought to an end the ascendancy of provincial nobility and
initiated the process of the ascendancy of the monarchical centralization.
PATTERNS OF POLITICAL HISTORY IN THE „SOUTH‟
The States and Peoples of Southern Ethiopia
Politically speaking and in comparison to the northern society the so called ‗south‘ was far from
a homogeneous category itself. There were different category of principalities which attained
varying degrees of social political organization and a comparatively distinct course of history
ranging from communal societies to quasi-states with power full kings and elaborated
mechanisms of exercising authority. The Oromos with their own distinct political and social
organization were significant among this ‗southern‘ category to unleash the initial phase of
interaction with the north before the 19th century modern state formation. With the phenomenal
expansion in the 16th century the Oromos reached as far as the borders of Tigray and Gojjam
and settled in huge numbers in southern part of Showa. This increased admixture of Oromos with
the Amhara–Tigre society brought the social and economic
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transformation of the Oromos themselves, the northern society and the other southern societies.
Some sections of the Oromos in fact abandoned their rather egalitarian socio-political
organization of Gada to a more hierarchical system like that of the north. However, closer
presence of Oromos in the north did not make them dominate the northern politics except for the
brief period during the Zemene Mesafint where Oromos from Wollo dominated the Gonder
politics under their Yejju dynasty. Until their incorporation into the Ethiopia empire state in mid-
19th century there were some Oromo principalities in such areas as present day Wellega,
Ilubabor retaining their tradition and institutions before abandoning them gradually. In south
western Ethiopia the Oromo expansion brought them in contact with different peoples which
they influence and influenced by. Due to these interactions Oromos adopted a system of
government which unlike the ethos of the Gada system relied on monarchical systems. The five
Oromo Gibbe states of Limmu-Enarya, Jimma, Gera, Goma and Gumma were evidence of such
cultural interactions and assimilations.
The Borena Oromos represented another relatively distinct historical pattern within the larger
Oromo. The Borena, unlike others, preserved their long tradition intact. Neither Christianity non
Islam affected the Borenas‘ pastoral way of life or their Geda organization for long even to the
present day. In general, it can be maintained that even before the Meneilik‘s expansion, Oromo‘s
socio-cultural interaction with different peoples gradually transformed their socio- economic
structure. However, these processes of transformation were slow and uneven affecting some
more than others.
What is now called the southern part of Ethiopia also witnessed a relatively distinct pattern of
history relatively prior to Oromo expansion and prior to the modern Ethiopian empire state. Such
principalities and kingdoms like Kaffa, Wolayeta, Hadya etc enjoyed elaborated mechanisms for
exercising autonomy and political control. In fact, to a certain extent some of these principalities
maintained some historical ties and trade relations with medieval kings of northern Ethiopia.
In the south eastern, eastern and north eastern part of Ethiopia different peoples with distinct
socio-political and geographical settings existed. The Somalis and Afars are among
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those which have been known for espousing Islam. Common to both Somalis and Afars has long
been their system of political organization which was based on a highly segmented clan
structure, a pastoralist way of socio economic organization and a strong attachment to Islam and
inhabitation of rather inhospitable desert areas in the lowland section of modern day Ethiopia.
Another category of people that formed into modern Ethiopian from the so generically called
south have been those communities in the western and south western part of Ethiopia. These
communities have been for long constituted the peripheral section in the Ethiopian state system
and historically known for developing less social differentiation and loose form of organized
socio political organization in comparison to other communities in the country. The Berta, Gumz
in present day Beni-Shangul, Anuwas and Nuers in present day Gambella together with a
number of other numerous small groups are instances.
A Brief Account of the Role of Islam in Ethiopia
Islam‘s firs introduction was in the northern part of ancient Ethiopia and dates back to the time
of the prophet. Initial contact was in fact cordial as Aksum gave the safe haven for Muslim
refugees in the 8th century A.D. In subsequent centuries Islam sat roots in Ethiopia precipitating
intermittent conflicts. Islam‘s gradual expansion into the north first came through Muslim traders
who dominated the Red Sea Port and the long distance trade. These traders formed the first
Muslim communities within the Christian domain and in fact enjoyed the protection of the kings
and the regional nobilities for their trading activities which the traditional Christian society
avoided for some cultural reasons. Such cordial relations came to an end following the expansion
of Islam into the northern hinterland by the Ahmed Gragn wars. These wars had many
consequences. It proved a mutual destruction for both sides easing the way for the expansion of
some groups (Oromo‘s in particular) into the center of the northern principalities.
The role of Islam was much more critical in shaping the relationship between the different
people who later formed the Ethiopian state. As significant groups from the non-Northern side
espoused it, Islam began giving an alternative prime symbol of nationalism different from
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Christianity which was long equated with ‗Abyssinian nationalism‘. In fact many non-
northerners espoused Islam as a bulwark against northern nationalism. But Islam had not
provided an ideological and a politically unifying framework for its followers lacking
institutional expression like Christianity that would have helped it transcend over the ethnic and
cultural barrier of its diverse and widely geographically distributed followers.
In general, the essence of the above discussion is that although to varying degrees, peoples that
constituted the modern Ethiopian state have had historical interaction of one sort or another even
before they came under a highly centralizing state at the end of the 19th century. In this regard it
can be said that whereas the northern section of the state experienced a relatively homogeneous
existence due to mainly the Christianity religion the so called the southern part experienced huge
level of heterogeneity in terms of culture and degree of socio-political organizations. In the next
section we will discuss how these patterns of history and interaction unfolded in the making of
‗modern‘ Ethiopia during and following the second half of the 19th century‘.
CHAPTER TWO
The Problematic of Political Power
Political science approaches state formation in the context of the problematic of political power
in the subsequent state-society relations. In political science the problematic of political power is
seen in the interconnected sense of first organizing and/or creating effective political power and
second in the sense of what to do with political power measured against better performance in
terms of economic development, national unity, democracy, poverty reduction and security
promotion etc.
Analyzing the problematic of power in Ethiopia should start with the assumptions that like other
comparable process elsewhere in the world historically the process of modern state formation in
Ethiopia is characterized often by contradictory process of conflicts, negotiations and
compromises between different groups.
State formation aims at achieving an integrated existence as a national unit on the basis of certain
political project around a power center which is an instrument of hegemony and constituted by
one or several dominant classes occupying the heart of the process and drive it
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as a whole. In other words state formation is combination of two related yet distinguishable
process of state-building and nation-building.
The problematic of political power has been the reflection of Ethiopia‘s emergence in the second
half of the 19th century that ultimately brought together diversified people over a vast territory
under centralized control and its continuance as a political system since then characterised by
regimes that adopt state and nation building projects that would deal with the problematic of
political power in the state-society relation in ways that facilitate the maintenance of a tradition
of exercising hegemonic (and as a result narrow) political power under a centralized state
structure over the society.
Since the 19th century the elements of exercising hegemonic power involves four interrelated
structures and process. These are (a) creating and maintaining a structure of administrative and
bureaucratic control, through which the power of the central government is maintained and
enforced over the people within its jurisdiction; (b) institutionalizing a system of extraction and
distribution, through which resources are extracted from the economy and distributed according
to the priority of the government-mostly of course for the maintenance of the state itself; (c)
adopting a strategy of extraversion of external resources to utilise technical, financial, military
international assistance to legitimate and reinforce the central government; and (d) establishing
an ideological apparatus to legitimise these practices and encourage adhesion and support by the
population.
Comparing and contrasting the ways the different state-building and nation-building projects
pursued by successive regimes served and failed to serve the goal of maintaining hegemonic
power over society would help us understand the problematic of political power in Ethiopia.
Historical Prelude to Modern Ethiopian State Formation
As discussed, historically traditional power in northern society has always been contested
between the centralizing monarchy and regional nobilities. These set in the first drive towards
modern state formation. In this connection we may say that the modern state formation in
Ethiopian proceeds by the victory of a centralized polity (historically represented by monarchy)
over parcelized (or divided) polities (historically represented by
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regional nobility) in the northern part of Ethiopia. That process began in the mid-19th century
following the end of Zemene Mesafint by Tewodros II who initiated the drive towards the
hegemony of a centralized polity.
The Zemene Mesafint was a period where the northern society was dissolved into its quasi-
independent provincial polities (Tigray, Gonder, Gojam, Wollo, Shewa) which engaged in an
endless and inconclusive struggle for supremacy. The Zemene Mesafint was the period in which
the provincial entities exercised their divided sovereignty which was an extension of the
declining powers of the monarchy which the regional nobilities competed to fill.
Different factors accounted for these developments beginning from the 16th century. The blow
suffered by the northern kings by the protracted war with Ahmed Grgan was one. The
subsequent ascendancy of Oromos who overrun the territories of the Muslim sultanates and their
advance and increasing involvement in northern politics in Gonder was another. The rather weak
Gonderian Kings relied on strong Oromo support to compensate for their losing control over the
powerful regional nobilities. As a result, the Northern monarchy fall prey to powerful provincial
lords.
However, the Zemene Mesafint was also the result of a failure by any one of the provincial
nobilities to assume the kingship in Gonder. Rather, the relative power of regional rulers was
measured by the capability to become a king maker and un-maker in Gonder from their
respective regional domains. But these trends came to an end with the coming of Tewodros II
who defeated powerful regional lords one after another and restored the authority of the
monarchy.
Phase one: the Period of Initiation with the end of Zemene Mesafint
The modern Ethiopian state formation followed a historical pattern where the northern part gave
rise to a hegemonic center that took on the process into the other areas. Tewodros II‘s rise into
power as an unchallenged ruler of Abyssinia was the first response given to the challenge of
political disintegration in the Northern domain. As such Tewodros‘s period was characterized as
the period of initiation in the making of modern Ethiopia. His period was
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important for it laid the background than actually accomplishing the process of establishing a
centralized state.
Before realizing a centralized state, Tewodros II had to deal with potent political forces in the
north to bring integration and then proceed with territorial expansion into other areas. A least
initially he achieved military victory over established regional dynasties. To give the military
victory political meaning the king, attempted to break major traditional provincial entities into
smaller administrative units governed by his own appointed officials. This was to deprive a
power base to the regional nobilities and to reduce the monarchy‘s traditional reliance on the
military force raised by regional nobilities,
Tewodros II introduced the idea of a national standing army under his direct control and with
salary paid by the central monarchy. Tewodros II had also to deal with the church establishment
and the clergy as well and compete with them for resources to maintain his large army. These
demanded him to curtail the church‘s long standing privilege over tax exemption. Although
external threat in the form of Egyptian expansion formed Tewodros‘s initial worries, the external
challenge was more of apparent than real danger to his rule.
The end of Tewodros II was a combined outcome of a fundamentally internal causation and a
relatively contingent external factor. The former had to do with the resumption of provincial
rebellion that forced him to adopt brutal campaigns. This provoked increasing resistance and also
his frustration. Undermined by the king and deprived of their economic interest, the church and
the clergy also undermined the power of the king.
In its modern history Ethiopia faced external challenges that threatened its territorial integrity
motivated by expansionist and colonialist derives. These had been true during the period of
Tewodros II as well although their implications were far greater in subsequent periods. During
the period of Tewodros, the external challenges were apparent than real and mainly facilitated
his personal down fall. The British, which later colonized much of Africa since 1870, had no
plans for a permanent occupation of Ethiopia after their Napier military expedition to Ethiopia
fulfilled the rather minimal mission of freeing the British hostages of Tewodros II in 1867.
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In general, Tewodros II‘s initial experiment with modern state formation had incontestably laid
down the major orientations that subsequent kings built on. Since his time, the need for a highly
centralized authority remained the hallmark of Ethiopia politics and government. Subsequent
kings attempted to elaborate, consolidate and complete the grand modern state formation project
the foundations of which were initiated by Tewodros II.
Phase Two: Expansion of the Project of Modern State Formation
The period of Yohannis IV can be considered as one of elaboration of the ideas of emperor
Tewodros II. In fact modern Ethiopia as a political entity with a well-defined territorial boundary
was ‗imagined‘ during the period of Yohannis IV; ‗imagined‘ because real accomplishments had
to wait for the coming of Menelik II and after.
Preexisting internal challenges continued during the period of Yohannis IV as well. The
challenge of regional nobilities merging with a claim for the Ethiopian kingship came strongly.
Yohannis of Tigray needed to assert his claim for the throne in the face of two important rivals
form Gojjam and Showa. His (Yohannis IV) approach was a mixture of force and diplomacy
based on his assessment of the relative strength of his rivals.
In the former sense, Yohannis managed to have the recognitions of the two rivals for his
emperorship by recognizing their claims for regional lordship. In the later sense, Yohannis also
used force to subdue one of his rival in Gojjam (Negus Tekle-Himanot) due to the latter‘s
relative weakness. Encouraged by his cautious assessment of the forces of regionalism and
forced by Menilike‘s relative strength in Showa, Yohannis followed a policy of toleration
towards Menilik. For Menilik, this delicate balance gave an opportunity to continue strengthen
his power base in Showa and engage in extensive arms trade and expansion into territories to the
east, west and south of Showa. For Yohannis, the balance created with Menelik of Showa created
a breathing space to deal with a more urgent and forceful external challenges of his time.
The first external challenge was from Egyptian expansion and was dealt militarily and
effectively at the two different and decisive battles of Gudent and Gura. But these were followed
by three simultaneous external challenges which in the end brought his end.
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With the opening of the Suez Canal, Ethiopia faced imperialist challenges from Italy. Although
to endure much longer, this first imperialist challenge in the form of Italy, which occupied the
Ethiopia‘s outlet to the sea, was repelled at the Battle of Dogali. However, Yohannis‘s quest for
access to the sea which British helped Italy occupy made him fell pray to British diplomatic
upper hand. Expecting British diplomatic support, he gave into the demands of the British for his
support in their confrontation with the Mahadists (in the Sudan) which buy him hatred by the
later.
Disappointed by the British diplomatic betrayal of the terms of agreement and confronted by the
hostility of the Mehadists, Yohannis lost his life in war of revenge by the Mehadists in 1889 at
the Battle of Metema. Ethiopia with a much more intensified external challenge and with an
already elaborated drive towards internal territorial expansion passed on to the period of Menelik
II.
Phase Three: Consolidation of Ethiopia‘s Modern State Formation
MenelikII‘s rise to power was notable for demonstrating the predominant role of the military in
the process of state formation consolidation. The military power helped the expansion of a
relatively cohesive and centralized authority in the Northern core into the south and this was the
hall mark of the consolidation of Ethiopian state formation during the period of Menelik
II. With his successful response to the external challenge, Menilik created the Ethiopian state
with a more or less defined boundary that roughly matches with modern day Ethiopia.
The period of Menelik II witnessed the culmination and consolidation of vast territorial
expansion turning Ethiopia into an empire state. The process brought the southern part of the
country under the domain of the ‗Solomonic‘ line presiding over large number of people of
diverse origin and culture. As compared to the north, the incorporation of the south came in a
relatively shorter period of time. This was made possible by the superiority of arms Menilik II
enjoined over his target of incorporation. The expansion of Menelik II has been a matter of huge
political controversy that gave rise to contrasting interpretation on its effect on the contemporary
Ethiopia politics.
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What explains emperor Menelik II‘s story? Both internal and external factors can be said to have
given a motivation to Menelik II‘s phenomenally large scale expansion from Shewa into the
south, south east and west and lowland peripheries.
The need to build strong power base in his contest for the throne against Yohannis IV was the
first economic motive that directed Shewa‘s expansion into the south and southwest where the
lucrative long-distance trade route was attractive. After defeating his Gojjam rival at the battle of
Embobo, Menelik dominated the trade route thereby assured himself a strong economic base to
succeed Yohannis IV to the throne.
External challenges in the form of Europeans‘ ‗Scramble Africa‘ also conditioned and shaped
Menelik‘s drive towards the south by putting a survivalist rush to incorporate as many territories
as possible against Europeans. His expansion and effective control of these territories in the
south, south west and south east was one way to proof Ethiopia‘s territorial claims against
European claimants. This competition reached climax when Italy attempt to colonize Ethiopian.
By defeating Italy at battle of Adowa in 1896 Menilik not only rescued Ethiopia‘s territorial
integrity from the colonial expansion but also gave it its more or less defined and internationally
recognized boundary. The victory in turn gave Menilik extra motivation to go on with his
expansion drives towards the south.
The Menelik expansion took two distinct forms with different outcomes depending on the degree
of resistance from the local population. Where resistances were absent, the incorporated areas
were left with their pre-existing socio-economic arrangements. In such cases like Wellega,
Jimma and the like only tributary relations were established. Local rulers in these cases were
given the status of balabat serving as transmission belts connecting the local people with the
center. In other cases where there was local resistance military suppression was used followed by
stiff order, the crushing of local dynasties and the direct presence of Menelik II‘s own appointed
officials. Western Gurage, Arsi Wolayta, Keffa, Harar were some examples.
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The Economic Foundation of Modern Ethiopian State: Towards Consolidating the State
Formation
Immediately after completing the expansion process, the power center of Shewa embarked on
establishing its system of rule over the ‗new‘ territories. This was mainly achieved through the
introduction of a new land holding system in the south by modifying the land holding system of
the northern part to make the system of control in the south effective and easy to the central
government in Addis Ababa. The change in the land holding system of the south was to enable
those wielding power to appropriate land as well as tribute and labor from the peasantry. In
effect the system created a new pattern of power distribution in the southern areas and
established a new hierarchy of authority within the expanded Ethiopia empire state.
The Gebbar System
There are two contexts to discuss the gebbar system of the land holding; first in the northern
Ethiopia as the basic form of social and political structure and second as it was applied in the
southern part immediately after Menilke‘s expansion till early 1950s. Historians characterize this
period of modern Ethiopian history as the period of consolidation of the modern Ethiopian state
with the expansion of the gebbar system from its northern historical core areas into the southern
areas.
In the north Ethiopia social stratification in relation to political hierarchy attained well-
established form through centuries-long process of integration within the framework of the
Christian state. The system of political organization was based on the social structure founded on
the relationship between the state (the monarchy and the nobility) the church (the clergy) and the
peasantry. The relationship was defined by each groups‘ relationship to the means of production
i.e land. In the north society, land holding rights were ordered according to the basic principles
of the society.
Each of the categories had a complex arrangement of rights and obligations in relation to land
and to those who claim rights over it. These arrangements include kinship, the state and the
church (religion).
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Box 1: The economic foundations of the modern Ethiopian State in the period of
Menelik and Hailesellassie were the gebbar system which was anchored in a plow-
based mixed or enset-based farming in the highlands, and taxes from domestic long-
distance and external trade.
The gebbar institution in its narrow form emerged in Shewa and Wollo, in the latter part
of the Gondarine period. This agrarian system was later extended in a modifed and
harsher form to the southern provinces. The concept of gebbar system is often
misunderstood. In its generic meaning, gebbar meant a landed payer of obligatory state
fees, taxes, and services. So, technically, all rist-holders are gebbar (who pay gult, tithe,
and perform service--gibir) to the Emperor or his agents. In its narrow meaning, it refers
to cultivators of land in militarily administered districts who must meet both customary
tribute obligations as well as extra-ordinary labor obligations until the administrative
system was normalized. Only in labor-scarce regions and in the initial stages of conquest
(since soldiers and administrators cannot cultivate government-granted, in lieu of salary
or maderya, lands), do we observe people being compelled to cultivate the land and
hand the bulk of the produce to the soldiers. In this sense, the gebbar is neither a
chisegna (renter) or a serf (which, in addition to being tied to the land, has no personal
freedom).
Box 2: Land tenure (yemeret sireet) defines the producer-appropriator relationship between
the landowner and the socially-sanctioned residual claimant (usually the producer or the
entire community. The property right in land often includes the right to income (from own
cultivation or leasehold), the right of use (usufruct), the right of transfer (by temporary gift
or an encumbered mortgage), and the right of alienation by gift or sale.
Tribute or gibir is an economic as well as a political relationship among a hierarchy of

classes or estates—the state elite (bete-mengist), the Church elite (bete kahnat), and the
tribute-paying clans or polities (bete-seb or bihere-seb). Internal tributarism is an institution
that defines the relations between the endogamous soldier-noble-priestly overlords and the
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producer-plebian peasant, artisanal, or mercantile classes of the core provinces. This mode
of administration of the income and service rights of the state is the defining feature of the
much-maligned gebbar system
Now let us see the dominant forms of land rights, each with a well-defined political role
The Rist Sireet
Rist (kinship-based): rights over land were claimed by the descent group (based on kinship). Rist
is a land held and transmitted hereditarily based on individual claims to descent and his/her
effective possession of land. All members of a kin group have rights to a share of land. This
means hereditary right cannot be lost through absence and that reallocation of land can be
practiced to accommodate all new claimants for the land. Rist land was also transmittable along
both parents. Rist in its traditional sense and as used in the northern Ethiopia can be defined as
the rights of Christians of both sexes to claim, posses, inherit and pass on to their children land
on the basis of belonging to the same cognatic descents (form both parents) of a kin group.
A person who exercises rist rights is called ristegna and the right was the most clearly defined
and nearly absolute right over land. Customary law dictated that rist rights cannot be forfeited
provided effective proof of descent is established and the right must be recognized by the state.
To the northern peasantry, rist rights guaranteed the security of tenure. Any attempt to force
change in the rist system was regarded as a threat to the security of traditional life and were
highly resisted. However, hereditary rist rights can be abrogated and confiscated by the state if
the ristegna failed to pay tax. That is to say, rist right gave practically all of the peasantry in the
northern society land right but rist holders were subjected to the Gebbar system. This system
required the peasantry to support the non-productive class of the society through taxation of the
surplus produced.
The taxation was comprehensive, multiple and very burdensome. Tax was levied on the
peasantry on everything they had. The peasantry also had to provide labor for groups on the
privileged positions. For instance, there were more than twelve forms of taxation and three
important local level tax appropriators which in their descending order of rank constituted
mislene (supervisor of tax collection) Malekegna (military enforces of order) and Cika Shum(the
one who deliberate upon judicial matters of local disputes). Each of these
hierarchies of local tax officials passed on the tax they collected to the next hierarchy keeping
some portion for themselves until the tax reached the imperial center.
In the traditional northern society the peasantry exercised control over land through hereditary
claims and its relation with the political center was defined by the requirement of taxation and
tribute to the state. However, the state in general and the king in particular also exercised a more
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direct control over land form politically derived rights. The nobility as the second-in-rank to the
monarchy also exercised control over land by the state-granted rights .The monarchy had
extensive rights over land. He claimed the right for tribute over all land except the church land.
The state also claimed rights on land by confiscating the land of rebellious personas a
punishment. The state also claimed rights over land which was unclaimed by a descent group or
unused land.
The Gult Sireet-Sir‟at
The state by holding extensive rights over land exercised another system of land holding, which
was common in the northern part but later on expand into the southern part. This was the Gult
rights. Gult is the rights of tribute appropriation from peasants granted by the emperor to various
ranks of military class, the church and others in return for their military, administrative and
religious services rendered to the emperor. Gult grants were used as substitute for salaries and as
a means to rewarding loyal service.
The regional nobility being the main local functionary enjoyed gult grants by the state. Gult
rights can be of two types. It can be a right given to the gultegna to pay no or reduced tribute to
the state or it can be a right to collect tribute in behalf of the state and keep a portions or all of it.
Gult rights were temporary depending on the service provided to emperor. But in some instances
gult grants can be granted permanently for a recipient or can be vested hereditarily on his/her
family resulting in rist-gult claim. In practice gult rights are grants to a recipient not of the land
but only the peasantry working on the land. As a result, the gultegna can not dispose off the
peasantry his/her right to rist except on failure to pay tax. Because gult grants were not
permanent, they gave the emperors convenient and effective way of controlling the behavior of
local functionaries.
Samon Land
In the northern traditional society the church as an institution and the clergy as its functionary
also exercised control over land. Traditionally the church claimed 1/4 of the land of the state.
This church land was called samon land in which the church enjoyed certain rights as a
compensation for the provision of religious services.
Samon land paid no tribute to the state and it only implied an obligation of anyone working on
the land to pay tribute to the church. The church also enjoyed gult grants called royal grants by
the state and it can also be granted rist-gult rights called church rist-gult. A peasant whose land
was given to the church as church rist-gult theoretically losses his/her rist right and become a
tenant of the church and the clergy using the advantage of being the main church functionary can
evict the peasant from the church rist-gult land and can work on it by itself. But the clergy can
not claim the church land as private property and transfer the land through sale or inheritance.
Land grants to the church were irrevocable and were not subjected to taxation to the state.
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In general, social stratification in the traditional northern society based itself on each groups‘
relation to land. The peasantry with rist right was at the bottom of the social and political
hierarchy being subjected to different taxation requirements to the different hierarchies (both
secular and religious) of power relationships. In general under the gebbar system the secular and
religious hierarchies functioned collectively to sustain a respect for authority which the state
viewed as a primary value. The state for its part compensated them by respecting their centuries-
long rights over land the ultimate benefit of which was the right to collect and appropriate
taxation and tribute. The heavy burdens of the arrangement fell on the peasantry beyond
imaginable proportions first in the northern areas and later on the southern part of the expanded
Ethiopian empire state. The Menelik expansion into the south was followed by similar
mechanisms of exercising authority and appropriating land and labor in the southern areas.
In what to follow we will discuss the particular features of exercising authority in the south in
relation to land relationships in terms of changes and continuities to the traditional form
prevalent in the northern areas we discussed above. Following the Menelik‘s expansion, social
stratification based on the relationship of individuals and groups to land was established in the
new areas. As a result, different social groups emerged. The need to impose authority and
effective collection of tribute from the land led to establishment of administrative structures to
maintain order and effective authority in the south. These determined the pattern of land
allocation and the nature of social and political stratification.
To compensate for the limitation of organization and resource of the state, and to transcend over
barrier of language and cultural difference and to facilitate collection of taxation, the new
authority from the north instrumentally used indigenous authorities called the southern balabats
as intermediary. Some of these local balabats were part of the local authority even before the
Menelik expansion. Based on their peaceful submission they were made to retain their position
and recognized and accorded status and economic privileges. In areas where traditional authority
was abolished by Menelik forces the balabats were drawn from the local population based on
their willingness to serve the ruling group loyally and as a result they were given similar
privileges. In any case both types of balabats were to serve in supervision and collection of
tribute for the state. The balabats were also beneficiaries in that they were privileged to keep a
portion of the tax they collected, or pay reduced tax or exempted. The arrangement transformed
the southern balabats into a privileged land holding class by their own standard. They assumed
similar authority like that of the northern local authorities in the northern areas such as the chika
shum, melkegna and/or meslegne.
Likewise, they (balabats) commanded labor and service of the southern peasantry. Even they
were different in that they possessed land as their personal property reducing the peasantry into
tenants. In this respect the peasantry in the south, as different from its northern counterpart
exercised no ownership of land (say in the form of rist). At one level, therefore, the Menelik
expansion in the south did affect the southern social setting by introducing new class of
indigenous landowning class (i.e.balabat) whose social privilege was different from the ordinary
population by their privileged access to land and produce of the land. The balabat land owning
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class in the south was one of the new elements added on the traditional gebbar system along with
its expansion into the southern areas.
At another level, the expansion of the gebbar system into the southern areas also drastically
transformed the relation of the southern peasantry to land by making all the southern land state
owned land. With this the peasantry as social classes were transformed into gebbar and became
subjected to multiple tribute exactions losing a considerable portion of their production and labor
immediately to their balabats and through them to the political center. As far as their gebbar
status, the southern peasants were similar to those of the northern peasants. But there were
substantial differences. In the north, the tribute paying peasant was also a ristegna and cannot,
under normal circumstances, be evicted from land or cannot be forced into tenancy. But in the
south, the peasantry‘s position to land was ambiguous and insecure and remains on the land on
the wishes of the state and the local balabats. The Menelik expansion into south also brought
about the replication of the northern land holding system of course with new elements added to
it. The state like in the north, claimed all southern land calling it madeira land and distributed it
to its lower political-administrative units which were filled by either the local balabats or state
functionaries form the north. The state used such maderia lands as one form of state grants and
used as a payment for service rendered to it. These kinds of state grants were known as shum-
shir land and as such were not permanent grants. As a result these were different from rist-gult or
gult grants. In the southern context, rist-gult or gult grants were granted to Meneilk‘s top war
leaders. Most of the time these recipients did not actually possessed their grants in the south for
most of them lived in their original areas in the north or in Addis Ababa. In effect the southern
rist-gult or gult holders were absentee landlords who left their grants to their representatives.
The Orthodox Church also enjoyed land rights in the southern area in similar fashion like in the
north. Another group form the north that gained land holding rights in the south was made out of
ordinary peasants form northern provinces who came along the Menelik military expeditions as
soldiers, messengers, prison guards and as tax-paying cultivators. These groups were differently
called netche lebashe or neftegna. From the above discussion we can say that the Menelik
expansion brought the spread the qebbar system from its historical and traditional origins in the
northern part to the southern part. In all of these contexts the essence of the system was the
establishment of tributary relationship the
ultimate goal of which was to consolidate the political, economic and social position of the ruling
class at the expense of the ruled majority.
However, in the course of its expansion into the south with Menelek‘s expansion, the gebbar
system evolved into two distinct features. First, the gebbar system in the north had centuries-long
existence and evolved over time and attained a level of legitimacy both in the eyes of the
appropriator and the appropriated. This gave the system in north customary appropriation
characteristics and was relatively peaceful where the state needed not to have a frequent use of
direct force to transfer wealth form the peasantry. At least, the tribute paying peasantry had
customarily evolved and as such strong basis to claim ownership rights over the land against the
state. Second, in the south the gebbar system can be referred to as predatory appropriation.
Tributary extraction was primarily based on the use of force and tributary appropriations were
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chaotic and involved compulsory transfer of wealth. However, such distinctions between
customary appropriations versus customary appropriation were not exact in that even the
northern part the two forms of appropriation coexisted. During war time for instance, the
northern peasantry had to experience the predatory demands of the winner warrior class which
historically equate victory with looting and plundering of the peasantry.
The Political Economy of the Gebbar System
The political impacts of the gebbar system were also profound. By placing a political economic
form of a hierarchal arrangement among distinct social groups by their differing relation to land,
the system created social stratification within the society. In other words those social groups
which the gebbar system gave privileged position were also the same social groups which were
politically dominant. For many observers these conditions made class analysis of Ethiopia‘s
state-society relation possible.
Class analysis assumes that asymmetric economic relationships among social groups in a society
where one group appropriate the surplus of another increases class antagonism between those
who make their own leisured existence possible by controlling the condition of production and
those at whose expense such a system relying on. On the Ethiopian
context the above class analysis reflected itself in the relationship between the peasantry, whose
economic burden in the form of tribute and taxations sustained the political center, the nobility
and the church which collectively formed the dominant holders of authority. These groups
through the gebbar system controlled the condition of production by controlling land which has
been the only means of production.
In the northern context class differentiation was reflected in groups‘ unequal position to the
means of production (land) and the appropriation of produce from it. Generally seen this had to
make class antagonism evident. But for long period of time the special features of the gebbar
system in the north militated against overt and sharp class antagonism in spite of the existence of
objective structure that would otherwise possibly led it to happen. The specific social process
contained with in the system in general obscured it. First, the degree of wealth accumulation
reflecting itself in life style, if high would sharpen class differentiation and antagonism.
However, accumulation in the north by the privileged class of the nobility and/ or the clergy was
so slow that the nobility and the clergy as a privileged class differed in their life style with the
peasantry very really. Low level of accumulation was the result of the subsistence agriculture
and the extravagant consumption pattern of the society. Second, cultural and social conditions
that linked the privileged class with the peasantry vertically were stronger than the horizontal
economic asymmetry. The peasantry, the nobility and the clergy linked in kinship, locality,
dependency and religion that reduced sharper class antagonisms. In the southern context, class
antagonism for all practical purposes was not the only important factor defining the relationship
between the different social groups in the south. First, class differentiation based on the
alienation of the peasantry from land and its subservient position as landless category was much
more vivid in the south. But this did not immediately give the class factor its explosive class
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antagonism manifestations. In the southern context the class factor as a result of the gebbar
system appeared together with other dimensions of the patterns state-society relations. Class
difference was merged with ethnic and cultural differences. The landowning class in the south
was essentially two in its type making ethnic analysis both difficult and possible. Class
difference matching with ethnic
difference tended to go higher if one looks at the majority of those groups who identify
themselves with the state.
The majority of the northerners who emerged as land owing class in the south following Menelik
expansion were Amara-Tigrie groups who share Christianity with the ruling power and the
related economic and political advantage over the local population. The southern peasantry, on
the other hand, can be clearly differentiated from this landowning class in the south who were
ethnically different from the majority of the peasantry. These appear to give the economic class
differentiation a clearer ethnic match. But the ethnically different land owning class did not make
integration impossible there by making class difference and ethnic difference not to
automatically and rigidly match.
This was because class difference was not sufficient reason for social distance between the local
population and the ruling groups. Integration was open as long as the local population accepted
Christianity and Amharic language. Another factor was that the land owing class in the south
also included indigenous balabats. This is to say that the degree of integration and the nature of
the rule itself muted or covered the much more obvious class antagonism in the southern context.
Furthermore similar factors account for the obscured class antagonism in the south like in the
northern areas. Like in the north, class antagonism in the south was minimal because the
standard of living by the most visible land owning class in the south(except the absentee
landlords) was not that much hugely different from the southern peasant.
The nature of the southern economy also imposed limitation on the economic exploitation
potential of the landowning class. Although the gebbar system in the south made it theoretically
possible to evict the peasant from the land, practically the southern peasant retained his land in
exchange for tribute and service for the landlord. For the landlord in the south evicting the
peasant was practically useless because the landlords did not work on the land themselves and
needed the peasantry to work on it and access economic benefits through tribute payment.
Menelik‘s military expansion into south, southeast and south west gave Ethiopia its present
shape. The victory of Adowa completed the process of modern Ethiopian state formation giving
it a more or less defined international boundary. Consolidations of authority reached significant
proportion as the political center expanded its traditional authority into the southern areas
through an elaborated system of giving, receiving and redistributing tribute through the gebbar
system.
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In summary, the process of the formation of modern statehood in Ethiopia was one in which an
old polity was struggling to become a born-again modern state to find a place as a legitimate part
of the international system. This involved four processes.
1. The simultaneous process of creative destruction of the zemene mesafint and the
innovative introduction of state consolidation and centralization in the northern domain.
2. The destructive annihilation of states and proto-states in the southern regions.
3. The heroic resistance against Egyptian expansionism and European imperialism
4. The southern push of emperor Menelik II that brought him on collision course with
adjacent colonial powers, mainly Britain.
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CHAPTER THREE
The Emergence of the Modern Bureaucratic State
Centralization of power and modernization had been the driving forces behind the very initiation
and consolidation of modern Ethiopian state formation. However, it was during the period of
Hailesselasse I that these processes reached their huge proportions to the extent of making the
gebbar system with its traditional features increasingly weaker and its eventual replacement by a
more bureaucratic state.
The gebbar system appeared to have reached its maximum limits in strengthening or elaborating
power centralization goals by the ruling groups. It was in response to the deficiencies of the
gebbar system that Hailesselasse I embarked on continuing the imperial based state and/nation-
building within a framework of a modern bureaucratic state system in Ethiopia to accomplish the
three main interrelated goals. These were centralization of power under the monarchy,
modernization of the state apparatus to strengthen royal powers and integration of the diverse
cultural groups under the state system the ethos of which were designed by the ruling powers.
During the period of Hailesselasse I, the gebbar system reached its maximum to enable the rulers
achieves these three goals.
The system lost it effectiveness due to the pressure exerted unto it by its increasing exposure to
modernization which made its way into the country following its integration in to the capitalist
world economy, the development of commodity production, rapid growth of urbanization,
modern institutions and modern means of communication etc.
Monarchical Centralization under the “Modern” Bureaucratic State
In a way to cope with the ‗modernization‘ pressures placed on the gebbar system and to make
use of the same modernization to strengthening the central royal power, Hailesselasse I gradually
replaced the old gebbar system with a modern bureaucratic state and government. In effect the
new development made the emperor to centralize power in huge proportion in the country‘s long
dynastic history.
Modernization was effectively used by the monarchy to weaken the political and economic
power of the nobility from its historically dominant position that came with the exercise of
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military and taxation functions. These leverages for long helped the nobility to seriously
compromise on and at times undermine the imperial rule. Under the gebbar system the central
government was relatively blocked from increasing its share of taxation collected from the
peasantry which was dominantly carried out by through agency of the nobility.
The landholding system gave the nobility an opportunity to appropriate part or all of the tribute
collected without adding much to the central government. Within a modern bureaucratic state
framework the Hailesselasse regime opted to abolish the intermediary levels between the tribute-
paying peasantry and the central government.
The regime accordingly, engaged in reforming the land taxation system by setting up uniform
regulation for provincial administration since 1940s through different proclamations. The
ultimate goal had been to take away from the nobility their traditionally vested and elaborated
taxation rights and direct the flow of the tribute into the central government in Addis Ababa.
Naturally, the nobility resisted these changes.
The Provincial Administration Proclamation of 1941, for instance, made all government
employees to be paid a monthly salary. This ended the ancient practice of granting officials a
tribute collection rights as a payment. It also fixed taxation and prohibited any other form of
tribute collection by other authority. For the peasantry the proclamation gave a sense of relief as
it freed them from the multiple taxation burden required by the nobility. The 1948 introduction
of a uniform rate of taxation ended any forms of tribute paying such as labor service other than
those payable by official currency.
These proclamations in addition to the 1944 education tax and the 1959 health tax together with
the traditional asrat taxation on land (which was levied on the 1/10 of taxation requirement
payable to the state from rist and rist-gult areas in the northern areas) resulted in shaping the
taxation mechanism of the bureaucratic state with its relatively uniform format. The implications
of these on the peasantry and the landowning class took the following general features.
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The mechanism of taxation did not relieve the peasantry from the burdens of taxation whether or
not he/she is a rist holder in the north or the tenant gebbar in the south. The land holding class,
on the other hand, escaped many of the taxation burdens implicated by the taxation reforms at
least for some time till the mid-1960s. The nobility was able to practically appropriate part of the
tax they collected by using their traditional political influence although in lesser proportions.
More than the nobility, the church continued to retain all of its traditional taxation rights and
remained exempted from taxation to the state.
The 1966 Tax Amendment Proclamation, however, significantly changed the taxation regime
established since 1940s. First, it abolished rist-gult rights and subjected both the gultegna and the
gebbar to pay taxes directly to the government. There by it abolished politically derived land
holding rights and weaken its main beneficiary i.e. the nobility. The nobility tried to escape the
loss of land holding rights by claiming the land as their private property especially in southern
areas. (incipient capitalism!?)
The 1967 Income Tax also abolished the asrat taxation collected by the landlord and replaced it
with agricultural income tax. Because the proclamation levied the tax on the income from the
land it for the first time proposed the landlord income to be taxed. However, practically the
landowning class managed to escape taxation on its income as most of the landowners were also
members of the ruling group as well.
In effect, therefore, it was the peasantry that shoulders the burden of a much more efficient and
elaborated taxation system that accompanied the modernization of the state and government
system.
The process of modernization which began with Ethiopia‘s increasing integration into the global
capitalist economy transformed the predominantly agricultural based economy with adverse
implications on the conditions of the peasantry.
The international exchange economy increased the demand for commercial agricultural
production to which the subsistence farming of the old gebbar system was unable to support. The
new bureaucratic state opted to replace the subsistence farming with modern methods
and machinery to increase commercial productivity. The implications of these
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transformations were different in the different parts of the country. The southern part for its
ecological and geographical reasons created a huge potential to meet the regime‘s demand for
increased production of market oriented agricultural products. To this end the regime tried to
replace subsistence farming with big commercial agriculture establishments. To the southern
tenant the process caused their eviction from their land and turned them into landless agricultural
labors (proletariatization of the peasantry!?).
In the northern areas, the move towards big commercial agriculture did not bring peasant
eviction and landlessness. The traditional rist right continued to secure them their land tenure.
But these did not make their life better off economically. Firstly, the land holding size here was
very small to serve as a viable economic base. Secondly, the regime‘s orientation to commercial
agriculture leave the northern peasantry in marginal position as the area was not known for
producing a viable commercial product to the international market such as coffee, for instance.
The transformation with the introduction of commercial agriculture made the northern part suffer
economically by marginalizing it and the southern part by integrating it and scaling up its
‗exploitation‘ by the regime.
The most important political implication of such capitalist transformation was the change in the
existing relationship between the state and society. With the position of the landless peasantry
(mostly in the south) and those who own economically less useful small units of land (mostly in
the north) became increasingly disadvantageous, the latent class antagonism of the gebbar
system came to surface.
In general, the period of Hailesselasse witnessed the replacement of the traditional gebbar system
with a modern bureaucratic state system in Ethiopia. The major objective that shaped the
transformation was to weaken the nobility and strengthening the royal powers of the emperor.
The above discussion illuminates how the regime effectively institutionalized governmental
functions in the economic sector to foster economic centralization and safeguard the position of
the throne within ‗modern‘ bureaucratic state framework. The modernization process was also
effectively used to disintegrate the political foundations of the gebbar system especially
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those features which gave a political room to the nobility. This took the form of constraining the
provincial power wielded traditionally by administrative structures that concentrate effective
power in Addis Ababa.
The Italian brief occupation of Ethiopia between 1936 and 1941 assisted the new
institutionalization and concentration of power in Addis Ababa. The long system of roads built
by the Italians reduced the spatial distance and enabled easy movement of troops from Addis
Ababa to areas of regional rebellion and enabled the central government to undertake closer
surveillance over regional activities. The guerilla resistance against the Italians caused the death
of many prominent regional types of nobility and some of those survived lost prestige by their
collaboration with the Italians. The Italian occupation already ruined the dominant class of the
nobility so fast that upon his return from exile the emperor found his centralization policies
significantly accomplished.
Towards Royal Absolutism
The regime institutionalized modern instruments of administrative centralization and

enforcement in ways designed and made to co-exist with traditional methods that were also
relevant to the desire of centralization by making the modern institutions non-autonomous and
appendages to the emperor. On top of the façade of modernization was the rather unprecedented
and strong drive towards royal absolutism where effective governmental power remained
monopolized by the emperor.
The Council of Ministers, the Office of the Prime Minster and Individual Ministers
Members of the Council of Minster were individual ministers appointed by and responsible to
the emperor individually. The role of Council was mainly to co-ordinate its members only to
advise the emperor. The role of the prime Minster was to supervise and coordinate their
operations and to convey the king‘s orders.
Effective governmental power was monopolized by the emperor. Firstly, the officials were
personally dependent on the emperor. Second, the emperor by letting individual ministers to
bypass the council of Ministers and the Prime Minster made coordinated activity and
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intuitional strength impossible. Third, every decision passed by the council was subjected to final
approval by the emperor. In addition, the council Ministers could not say anything in matters
relating to internal security, defense and foreign affairs. In effect the institutional design gave the
emperor huge personal political power. The political positions as a result, served the goal of
marginalizing its occupants (most of them were from the traditional nobility) from effective
power at the center of politics.
As institutions got stronger, the monarch continued to marginalize the traditional nobility by
selecting individuals from modern sources there by diminishing the nobility as the only source of
selection. The new sources of recruitment to ministerial posts were derived from the western
educated and relatively younger section of the society. These individuals had less or no noble
background and power base and were less conservative than the traditional nobility and a result
more less conforming to the emperor‘s power. By inculcating a system of manipulating
individual competition between the two groups and among individuals within the two groups, the
emperor managed to secure more loyalty from individuals who fought to win his personal favor.
Restructuring of the Provincial (Local) Administration
The imperial regime restructured the traditional provincial administration which for long gave
the regional nobility a command over regional activities. For that end it imposed a uniform
administrative structure throughout the country. Fourteen provinces with great variation in area
and population size were set up. These were called provinces (Tekelay Ghizat) which were
divided into sub- provinces ( Awarjia Ghizat) which in turn were divided into districts (Worda
Ghizat) followed by sub- districts (Mikitle Woreda).
These local government units were formally sanctioned by administrative regulations that in
practice curtailed the power of their local governors and other officials. For instance, the units
were forbidden to impose taxes other than fixed by the central government. They were also
prohibited from recruiting a police force of their own with the creation of a standing army that
took over.
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The highest local authority (the governor of province) was appointed by the emperor and was
made directly responsible to the Ministry of Interior. The central government also filled the
lowest local government units by persons directly from the center in addition to and over those
appointed by the governors. At all levels of the local government structures the regime used one
permanent criterion for appointment: personal loyalty to the emperor.
Modern Constitutions
The first ―modern‘ constitution was proclaimed in 1931. Neither popular demand nor a need for
legitimatizing the authority of the ruling power motivated the regime to proclaim the
constitution. The emperor‘s progressive inclination with a view to improve his international
image with a semblance of modernity was one motivation. Primarily, however, the constitution
was designed as a legal weapon in the process of centralization of power.
It established a legal framework to limit the exercise of personal arbitrary and ill-defined
traditional power of the nobility. First, the constitution declared the king ‗sacred‘, his dignity
‗inviolable‘ and his power ‗indisputable‘. Second, the constitution created quasi-representative
institutions in the form of Senate (yaheg mewosegna meker bet) and Chamber of Deputies
(yeheg memberiy meker bet).
The members of the Senate were selected by the emperor from among the nobility and members
of the Chamber of Deputies were proposed by nobility and approved by the king. The 1931
constitution gave no substantial decision making powers to these bodies but made their
occupants only to communicate any idea which may be useful to the emperor. Such important
decisions like approving final decisions, deciding the length of duration of the terms of the
members, the size of the parliament were reserved for the king.
In fact the 1931 constitution did not allow the people to participate in electing the members of
the parliament. Therefore, the constitution was a mere formal restatement of the facts of political
life in Ethiopia in which the unlimited power of the emperor was not constrained at all both in
relation to the nobility and the people. This was because none of the constitutional provisions
curtailed the growing of governmental power. Because the
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institutions to which the nobility filled membership were established in Addis Ababa the
emperor could keep the nobility at closer surveillance.
The overarching goals of the constitution and the resulting formal institutions were to weaken the
powers of traditionally powerful regional nobilities and strengthening the legitimacy of the
regime among the newly emerging urban and modern sector for which traditional values lost
their appealing power. Similar considerations and out comes were also integral part of the 1955
revised constitution.
In general, we can say that the way the imperial regime attempted to centralize power took a
modernization aspect. But it was ‗modern‘ not in its full sense. The ‗modern‘ institutionalization
of governmental functions had been selectively designed to foster centralization and safeguard
the traditionally conceived position of the emperor. The state bureaucracy was a combination of
the traditional ways of rule (which effectively used inter-personal relations) and a modern way of
rule (legal-rational ways) that relied on modern structures and institutions without autonomous
existence but were entirely appendage to the monarchy.
The Process of Nation-building and the “Modern” Bureaucratic State
The process of state-building as different form nation building was a far more complicated
process even before the modern bureaucratic state. The effective centralization of power
discussed above had also consolidated the state building process. The difficult task of integrating
the many different ethnic and cultural groups that constituted modern Ethiopia under an inclusive
nation-state framework (which is the essential meaning of nation building process) was handed
over to the modern bureaucratic state from the gebbar system.
Change and Continuity in the Modern Bureaucratic System
Like its gebbar system predecessor, the modern bureaucratic state erected by Hailesselasse relied
on an assimilationist tendency of absorbing the diverse ethnic and cultural groups into the culture
of the dominant ruling groups which traditionally conceived the paramount value system in
terms of Christianity and the Amharic language. In these regard the regime
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pursed neither specific policy to bring national integration nor any desire to do so in a new
national framework for integration driven by the diverse composition of the state. These were not
matters of the regime‘s public concerns.
In reality, however, religious and cultural problems went in with economic and political
differences in the society. For instance, Orthodox Christianity was the official religion. The
church (i.e. the clergy) was supported by state funds and was exempted from tax. The regime
also maintained the traditional pattern of promoting Amharic language as the only national
language. In fact the regime energetically gave institutionalized channels for Amharic language.
It was the language of instruction in the state school system and for much of the period had been
the language of media broadcasting. These orientations by the regime towards the integration
issue and the question of nation building were indicative of its crude form of cultural suppression
towards other cultural and ethnic groups in the country.
Contradictions of the Bureaucratic State System
Using economic, political, military institutional frameworks within a ‗modern‘ bureaucratic state
framework, the regime severely weaken the traditional sources of challenge to royal powers
which was the regional nobility.
Behind the modernization-centralization process laid a strong economic agenda valued by the
regime to establish a system of economic distribution which would further maintain and
strengthen the government‘s capacity to centralize economic resources to perpetuate the
privileged position of the ruling class. To this end the regime transformed economic relationships
in the country that centered on land relationships.
The ‗modernization‘ process in this respect was designed to deflect any attempts that may seek
to change the existing pattern of economic distribution away from the ruling groups. The
modernization process to these end created not a modern state as the agency of socio-economic
change that would increase the production of social values (primarily material ones) through
mobilization of resources, massive investment and planned development beneficial to the mass
population.
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In these respects the regime‘s social-economic attempts were formal than substantial. Whatever
economic development was there to talk about it was limited to some kind of primitive kind of
capitalism supplemented by the state investment in various sectors such as transportation,
communication, electric power etc. The regime‘s relative focus on commercial agriculture,
especially on coffee, couldn‘t help it pay for its raising expenditure leading the country into
economic crisis since 1950s.
Even the regime‘s initial experiment with the economic planning, following the 1950s economic
crisis, by formulating three five year plans (from 1957-1972/13) did not produce meaningful
result. The first two plans paradoxically mistreated the agricultural sector without a meaningful
governmental provision to the agricultural sector. The third five year plan as well did not result
in fundamental transformation of the agricultural sector. Although it seemed to give an attention
to the sector its focus was on the large scale commercial agriculture whereas the basic structural
defects of the agricultural sector had been related to the neglect of the increasingly bankrupting,
as a result, of the dominantly small scale subsistence agriculture.
The third five year plan was a total failure in that the regime could not provide enough
investment to support its plan and it did not address the core structural defects of the agricultural
sector which was related to the small and fragmented nature of the vast majority of land
holdings, the large-scale incidence of absentee landlordism, the massive presence of landless
tenants (especially in the southern part of the country), the prevalence low productivity and
population pressure.
All of these demonstrate the fact that what was created as a modern bureaucratic state was not an
agency of social– economic change but only an apparatus of administration and control with a
tremendous capacity for repression at the disposal of the regime.
The proliferation of governmental functions and the agencies of the modern state facilitated the
demise of the traditional nobility as a social group. The same process as well made the rural mass
a subject of powerful and dominating state bureaucracy with a huge extractive and coercive
capacity. However, the same modernization process accompanied unavoidable
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but undesirable outcome of producing a new social group in the urban areas tracing its origin and
source of power from the modern sectors and its enhanced scope of action and position in the
state structure from the proliferation of governmental functions and agencies of the states.
The Problem of Effective Institutional Development
As we discussed above the monarchical driven bureaucratic state did not create a modern state as
an agency of social–economic change but only established an apparatus of administration and
control with a tremendous capacity for repression at the disposal of the regime. We also
discussed that in the process a new social group in the urban areas tracing its origin and source of
power from the modern sectors and its enhanced scope of action and position in the state
structure from the proliferation of governmental functions and agencies of the states emerged.
This urban group was essentially made out of the urban intelligentsia which came as a new
claimant for power within the society. This middle class sought to fashion a system of
government which it would dominate. Initially the educated class got a closer access to the
political process by winning the favor of the monarch against the traditional nobility as the group
proved indispensable for running the continued institutionalization and bureaucratization of the
governmental process. The imperial regime tried to make the emerging middle class dependent
on it by pursuing patterns of economic allocations that favored the urban areas where the middle
class dominantly found concentrated. The aim was to ensure that the middle class remained
satisfied and accept the subservient position assigned to it by the highly power centralizing and
personalizing emperor. From these excessive centralization drives emerged the initial
contradiction within the state system.
By its nature the young and the educated middle class could not accept a position less than
institution-based power unconstrained by external and arbitrary political interference by the
emperor. It was from this urban based social group that the idea that the household style of rule
by the emperor was not conducive to healthy development of institutionalized process of
government started to take roots. The emerging middle class soon realized the administrative
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structure was a major obstacle to development and characterized by slow pace and misdirection
of the process of modernization.
At the level of governance the rigidly centralized decision making powers reflected itself in
institutional paralysis as modern institutionalization could not flourish the in the midst of huge
personalization power by the emperor. For those groups who filled these rather defunct modern
institutions the implication was a denial of opportunities for institution based power. At higher
and political level the contradiction between the social changes promoted through modernization
(e.g. the emergence of an urban educated middle class by the modern education system) and the
determination by the region to disallow or minimize political change was to produce a sense of
political alienation.
The Challenge of Nation Building Process
The regime‘s attempt to maintain a modern national identity using narrower and traditional
definitions that exclude a large part of the population was another of the system‘s contradiction.
Crafting national identity around the Amharic language and Orthodox Christianity in a state as
multinational and multilingual as Ethiopia was the main challenge to the regime. It provoked
countervailing attitudes equally narrow and uncompromising. This problem of nation building
reflected itself at two levels.
In the northern part, Amharic language as a national language weakened the traditionally
powerful role of Orthodox Christianity as a common bondage among the two main linguistic
groups of the traditional northern society (Amhara and Tigre). For instance, opposition to the
regime from Eritrea later on demonstrated how groups began to define themselves in a narrower
sense based on language categories to distance from the ruling groups. Ethno-nationalists groups
began emphasizing their ethnic identity as the main factor for their underprivileged positions in
the distribution of power in the ―hands of Amhara‖ ruling elites.
In the southern part the chances for harnessing ethnic sentiment was rather easier given the direct
correlation between unequal distribution of power, status and wealth and ethnic difference.
Given the narrower ethnic composition of the ruling class, actual or potential, the
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idea that the state favored or appeared to favor one ethnic group over others was rather easy to
make and to effectively use ethnicity as an instrument of mobilization against the regime.
Since 1960s and after emerge opportunities for different nationalist groups to give ethnicity its
shaper implications. The slow pace of economic development resulted in the production of
limited economic surplus which the ruling class had no intentions or capacity to share with those
who believe and/or actually were underprivileged. These objective economic gaps agitated the
emerging urban and educated middle class to call for a more equitable distribution of socio
economic values. The education system by producing unemployed urban intelligentsia had also
produced vibrant social group that could articulate effective opposition to the regime.
Furthermore, the regime failed to give appropriate institutional response and at times was
reactive and increasingly rigid.
In the long term the regime‘s non reaction provided fertile grounds for the growth of parochial
ethnic based movements in which the increasingly frustrated urban and modern educated group
step in to articulate and mobilize ethnic based opposition to the state.
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CHAPTER FOUR
The 1974 Ethiopian Revolution
What is a REVOLUTION: Before we discuss the structural causes of the 1974 Ethiopian
Revolution, its immediate causes, its course and dynamics, character and consequences we need
to conceptualize what it means by a revolution. All revolutions in the world have their own
unique characteristics in how they came about.
Defining Social Revolution
Scholars are also not in agreement as to how social revolution is defined. Table 1 shows how
different scholars have defined social revolution. One area of consensus in most of the
definitions provided in the following Table is that social revolution refers to the
transformation of political and socioeconomic systems. Unlike in political revolutions, where
only old political regimes are replaced by new ones, in social revolutions, both political and
economic systems of the old order have to be dismantled. However, one can still identify key
problems in other areas of the definitions provided in the Table.
Most of the definitions provided above refers to revolution as a ―rapid‖ and ―violent‖
phenomenon. Most, if not all, of these definitions seem to imply that social revolutions are of the
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same kind or exhibit the same pattern. This is not the case, however. Indeed, it was Huntington
(1968) who first noticed the difference in the pattern of revolutions. He identified two patterns,
which he referred to as ―Western‖ and ―Eastern.‖ He called the French
Revolution of 1789, the Mexican Revolution of 1910, and the Russian Revolution of 1917 as
Western Pattern. He labeled the Chinese Revolution of 1949 as an example of the Eastern
pattern.
A key distinction between the two patterns, according to Huntington (1968), was that the
Western pattern occurred in traditional monarchial countries and the Eastern in modernizing
patrimonial states. In addition, in the Western pattern, the sequence in the unfolding of events
was as follows: First, traditional states collapsed; second, social mobilizations followed; and
third, new regimes were institutionalized. In the Eastern pattern, social mobilizations occurred
before the fall of the states, and institutionalization of new regimes came last.
One can also add another distinction between the two patterns: The Western revolutions had
occurred ―rapidly,‖ whereas the Eastern had come ―slowly.‖ For instance, it is clear that the
Chinese Revolution of 1949 and the Cuban Revolution of 1959 did not occur over night. They
were slow in coming because insurgents in both countries had to wage protracted guerrilla
warfare against well-armed authoritarian regimes. However, the French Revolution of 1789 and
the Russian Revolution of 1917 occurred spontaneously and thus were rapid. In other words,
social revolutions can be either rapid or slow depending on their pattern. Interestingly, even
Huntington‘s own definition of revolution did not account for the variation in the patterns that he
observed. His definition of revolution contains only the word ―rapid.‖ In sum, few scholars seem
to take such a pattern into consideration when they define revolution.
Causes of Revolutions
Before discussing their causes, let us make a distinction between the onset and success of
revolutions, and between spontaneous and planned revolutions. While the success of
revolution heralds the transformation of the old political and economic orders, onset refers to the
initial popular uprisings; these uprisings have to be widespread across rural and/or urban areas
and a vast number of people (often in millions) have to be involved.
The other point is that we need to pay attention to the two patterns that we have identified earlier:
the Western and Eastern pattern, which is renamed as spontaneous and planned revolutions,
respectively (Gizachew Tiruneh, 2014).
By spontaneous, it mean revolution occurring without deliberate planning but with rapid speed.
Some social revolutions had occurred involuntarily. This does not suggest, however, that leaders
and organizations did not emerge once revolutions were ignited. The point is that nobody would
be able to anticipate or predict, before the onset of a spontaneous revolutionary uprising, that
popular opposition and resentment against the state would be exploding and catching fire across
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a given country. The French Revolution of 1789, the Russian Revolution of 1917, and the
Chinese Revolution of 1911 satisfy the ―spontaneous‖ pattern.
On the other hand, the guerrilla-based revolutions such as the Chinese Revolution of 1949 and
the Cuban Revolution of 1959 will be referred to as ―planned.‖ By “planned‖ it means these
types of revolutions were deliberately organized by a group of revolutionaries. Their success also
seems to take a longer time and treacherous roads, and this was especially true with the Chinese
Revolution of 1949.
It should be noted that the Iranian Revolution of 1979 is probably one that does not fit neatly in
the “involuntary” or “planned” category. According to Skocpol (1982), ―Indeed,
. . . if there has been a revolution deliberately ‗made‘ by a mass-based social movement aiming
to overthrow the old order, the Iranian Revolution against the Shah surely is it‖.
So, what variables can explain the onset of revolutions? According to Gizachew Tiruneh (2014),
the three most important variables that increase the probability of the onset of revolutions, both
for spontaneous and for planned ones, are economic development, regime type, and state
ineffectiveness.
Economic Development/ Socioeconomic Development
Economic development is believed to stand for the wealth, education, urbanization, and
industrialization of a given country. Economic development changes traditional societies to a
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modern way of life. This has been particularly true since the advent of the Industrial Revolution,
which started in Great Britain in the 18th century. With modern way of life, people tend to
become more educated and are more aware of their political, social, and economic conditions.
This means that the values that have sustained traditional societies for hundreds of years would
start to change. New and more secular values would emerge among the people. People start to
question the legitimacy of traditional regimes and their bureaucracies.
As more people get educated and become wealthy, they tend to demand the achievement of
political rights, such as the right to vote and run for office. They also tend to demand the
presence of civil liberties, such as equality before the law, freedom of speech, and organizational
rights. If such popular demands are not addressed, discontent will likely surface in the minds of
many people. Such discontent may not come into the open for a long time but could be suddenly
triggered by some other factors at any given moment. In sum, as de Tocqueville (1971) argued,
revolutions could come during economic progress.
Moreover, economic development tends to bring much more urban and industrialized ways of
life. As people migrate from rural areas to towns and cities, they may find themselves without
jobs or without sufficient incomes. Workers, a product of industrial life, may also feel exploited
or not getting paid fairly by capital owners. Thus, as Karl Marx argued, economic misery could
make workers revolutionaries.
Unless the government steps in to deal with economic issues, many people could find themselves
unhappy and resentful and could join others if and when a revolution is triggered. Moreover,
peasants who have been exploited by the landed interest or government bureaucracy could take
advantage of revolutionary situations to rise up and demand for land ownership, a fair share of
the crops they harvest, or a lower rate of taxation.
People also could resent if the economy is mismanaged by the government and the overall
quality of life in a society is declining or not improving as expected. For instance, the most
visible, though certainly not the only reason for the collapse of East European communism
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has been economic. However, it should be noted that it is a below mid-level of economic
development that tends to increase the chances for revolution. Once countries reach mid-level of
development, they transition to democratic rule, and democracy is least liable to revolution.
In sum, a variety of reasons including the absence of social equality, lack of political rights and
opportunities, and economic hardships could create discontent among many groups of people in
a given society. In other words, economic development seems to affect different groups of
people differently . Those who would be affected by economic development and be supportive
and participants of revolutions are likely to be the middle and working classes as well as the
peasantry. The upper class is less likely to involve itself in a radical revolutionary environment.
If we have, however, to pick one single class of citizens whose grievances would be most
important for the onset of revolution, it would be the middle class. Intellectuals,
professionals, artisans, small business owners, mid-size and independent farmers belong to the
middle class.
While the peasantry and the workers may be mainly interested in economic issues, the middle
class is likely to demand drastic political reforms and transformations. In addition, the demands
of the workers and the peasantry have often been sidestepped or given little attention by the state.
Moreover, it is a historical fact that neither the peasantry nor the working class is known to have
waged a successful revolution without the vital support and leadership of the middle class. Given
the constant nature of economic grievances among the lower and working classes throughout
history, we may argue that the most important factor in the onset of social revolutions is the role
of the middle class.
It is, thus, when its legitimacy is challenged by the middle class that the state completely or
nearly completely loses its legitimacy to rule and the fabric of its social support is shattered,
increasing the chances for the onset of revolution.
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Regime Type
Although regime type itself may, in large part, be a function of economic development, it seems
to have some independent impact on the onset of revolution. A case in point is that democratic
political systems or regimes have not so far experienced revolutions. Democracies, once
consolidated, tend to have a political culture that promotes negotiations, give-and-take
compromises, redistributive mechanisms, and institutions that deal with group demands; they
also tend to be legitimate. The foregoing suggests that if all countries establish democratic
regimes at some point in time, violent revolution will likely cease to exist.
Social revolutions have rather occurred in traditional autocracies such as in France, Russia,
and Ethiopia and in modern authoritarian regimes, such as Kuomintang‘s China and Batista‘s
Cuba. Many autocratic and authoritarian regimes may not adjust themselves with timely reforms
when faced with massive and rapid changes wrought by economic development. Communist
regimes do not often allow the presence of alternative parties and civil liberties. Such regimes
could lead to popular discontent and are more vulnerable to revolution.
State Ineffectiveness
The fact that not all autocratic and authoritarian regimes have faced revolution suggests that it is
not regime type per se that would lead to the onset of revolution. Autocratic or authoritarian
states that are quite ineffective may have a higher chance of facing revolutions.
State ineffectiveness refers to the weakness of the state or political leadership in satisfying the
needs and desires of the people. State ineffectiveness may occur when an autocratic or
authoritarian state mismanages an economy or fails to come up with appropriate and efficient
socioeconomic and political policies and reforms that would benefit the majority of the people.
The middle classes would be more willing to support the state if they have greater access to the
political system by having the right to vote, run for office, and freedom
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to speak and organize. The workers might be interested in
securing voting rights, but their main concern would be economic benefits such as wage hikes,
union rights, and good working conditions. The peasantry may be interested in avoiding
excessive taxation as well as securing land ownership. How the state handles the foregoing
issues would matter whether it is vulnerable to revolution or not. States that are ineffective and
tend to be vulnerable to revolution are those that consistently reject societal demands for
political reform and economic welfare and resort to violence to quell dissent.
Some ineffective states also tend to create patron–client relationship, which benefit only a
certain group or segment of a given society. For instance, the leaders of neo-patrimonial
regimes in Latin America, such as Batista in Cuba and Somoza in Nicaragua, created
individualized patronage politics that was susceptible to revolution. State ineffectiveness could
indirectly but empirically be measured by the level of support that the people have to the state.
Triggering Factors
The main conditions —economic development, regime type, and state ineffectiveness—would
need one or two triggering factors to produce the onset of revolution. The triggering factors tend
to ignite a long resentment that seems to have been boiling in the heads of the people. Examples
of triggering factors include war defeat, fiscal crisis, and rising prices. These are variables that
tend to occur suddenly and unexpectedly. Triggering factors are single events (not sets of
conditions) and serve as a catalyst or immediate causes of revolutionary uprisings.
In addition to military forces and some revolutionary individuals, the primary role of triggering
factors seems to be influencing the civilian population. Here, it is important to make a distinction
between the two patterns of revolution. In spontaneous revolutions, the triggering factors may be
war defeat (e.g., Russian in 1905 and 1917), fiscal crisis (e.g., France in 1789), rising prices
(e.g., high oil cost in Ethiopia in 1974. In planned revolutions, however, the triggering factors
seem to be those things that initially inspire the minds of revolutionary leaders. One of such
triggers may be when a leader or leaders is (are) influenced by a revolutionary movement (s).
Another trigger may be when a leader is exposed to an
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ideology. A promise for or getting initial armaments or financial assistance from external sources
could also trigger revolutionary leaders to start revolution. In other words, the
triggers of planned revolutions could be both events (e.g., revolutionary movements) and ideas
(e.g., exposure to ideology or being promised of support).
In sum, revolutionary situations seem to occur when massive and rapid social, economic, and
political factors reshape the people‘s sociopolitical value systems and affect their economic
welfare. But for a revolutionary uprising to start, an ignition may have to be provided by a
triggering factor. However, it should be noted that because revolution is a rare phenomenon, a
combination and severity of the main variables as well as one or two triggering factors may
have to be present to increase the likelihood of its occurrence.
„A revolutionary situation‟ and „revolutionary outcomes‟
For revolutions to be said to have occurred two basic conditions must be fulfilled. These are ‗a
revolutionary situation‘ and ‗revolutionary outcomes‘. A revolutionary situation basically refers
to the major causes and triggering factors of a revolution that has been discussed earlier.
First, what is called ‗a revolutionary situation‘ must exist before the regime in power is
politically overthrown. This situation requires the existence of circumstances within the social
and political order that will inevitably bring about the collapse of the existing institutional order.
In other words, a revolutionary situation refers to the structural problems of the old order and
some of the immediate causes that trigger the political collapse of the regime in power.
Second, there must be some measures taken by the seceding power (rule) to construct a new
institutional order different from the previous one. These refer to as ‗revolutionary outcomes‘
that combine the immediate result of revolutionary mobilization and their long term outcome that
would result in a fundamental social transformation of the society.
In the above sense the historical constitution of the modern multinational Ethiopian state and the
political economic dynamics between the state and society constituted the
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structural background that build a revolutionary situation in the country beginning more vividly
from late 1950s.
Causes of the 1974 Ethiopian Revolution
A) The contradictious within the monarchical modernization were the main origins of the
Ethiopian Revolution. The state system created was built on a cultural and on some degree ethnic
core around the identity of Amhara. This cultural core together with Orthodox Christianity had
made the issues important factors for anyone who sought any important part in the political
system. This made the system exclusionary as it hindered the creation of a nation state in
Ethiopia for the system was built around a singular cultural core whereas the state objectively
comprised of peoples of diverse languages and religions.
B) Another structural origin of the revolution had to do with the political economic
conditions of the imperial state. With Ethiopia‘s incorporation to the world capitalist economy,
the predominantly peasant-based society and the absolutist monarchical order found themselves
confronted with a new context of rapidly changing situation. The global economy created a
market for commercial agriculture products. The regime responded with participation in the
foreign exchange economy. This was however, driven by the regime‘s desire to earn a foreign
income to pay for the goods and services which it needed to maintain the privileged position of
the ruling groups. This was done through the dissolution and preservation of pre-capitalist social
relations in the different parts of the country.
In the northern part, preservation of the pre-capitalist relation especially over the control of land
was by and large left intact. The traditional social structure such as the rist system prevented the
regime from transforming the area‘s predominantly subsistence farming
into commercial agriculture. In addition, the northern area was geographically and ecologically
unsuitable for the commercial cash crop production such as coffee. The net effect was that the
northern peasantry although saved from experiencing huge scale land alienation, faced economic
marginalization as the regime neglected their subsistence farming
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to the extent that the region suffered from drought, erosion and famine and large scale
dislocation.
In the southern part, the world commercial economy produced a new socio-economic structure
for its geo-ecological suitability for the commercial economy and for the relative absence of
social structure to give the pleasantry an opportunity to exercise control over land. The regime
embarked on large-scale commercial agriculture the implication of which on the peasantry was
large-scale land alienation.
In this regard it can be said that the advent of capitalism formed one of the structural origins of
the revolution. The capitalism was uneven in its development with a marked regional disparity
where the mass or the population suffered marginalization and exploitation whereas the
dominant ruling class kept on enlarging its wealth accumulation which brought the
differentiation on political economic and social terms between the ruling group and the agrarian
mass much more vivid and increasingly sharper.
C) The imperial system‘s way of exercising governmental power and authority formed the
other of the structural causes of the Ethiopia revolution. The highly personalized style of rule
characterized by interpersonal lack of trust posed a considerable difficulty. In large part, the
system made it difficult if not impossible for independent institutional development in that
reliance on personal loyalties militated against dispersion and delegation of power and
establishment of effective administrative apparatus. The 1960 coup marked the growing rift
between the regime and the modern sector. These rifts took a radical shift when the students
expand the idea of change it advocated into huge magnitudes. To their growing radicalization
contributed their experiencing of economic alienation. As they came to realize the fact that the
state could no longer absorb them into its economic structure or create an alternative source of
employment, the prospect became very grim to the students. They went on with a manifest and
sustained opposition to the regime. The highest stage of their radicalization was reflected when
they began articulating what they called their ‗role in the
society‘. Accordingly, the students took as their role in the society to make the masses conscious
of the suffering they were enduring which a long socialization process made the
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society respect the authority of the feudal hierarchy. The sense of alienation felt by the modern
sector although vivid with student was also prevalent in the armed force.
The 1960 coup was the first indication of the regime‘s increasing incapability to continue to use
manipulation and factionalism to keep the military divided in its view of the emperor. From that
time onwards it had become clear that the imperial regime could no longer contain the
resentment developed against the regime by its differential treatment of high officials and junior
military rank and file.
Precipitating Causes of the Ethiopian Revolution
Dear student, the events that led to the collapse of the imperial regime that we discussed above
traced their structural causes from the contradictions inherent in that system. These were
reflected in increasing alienation of groups in the urban areas (students, urban unemployed, the
civil bureaucracy and the military) and worsening conditions of rural Ethiopia in terms of
increasing marginalization, exploitation and socio cultural subordination of different peoples in
the country.
Political Overthrow of the Imperial Regime
The Ethiopian revolution in its early stage i.e in the immediate political overthrow of the
emperor was largely an urban phenomenon where the rural oppositions we saw above played a
minor rule. Even as an urban phenomenon, the revolution was not made by an organized mass
movement. This characterized the Ethiopian revolution as spontaneous revolution in that the
imperial state prior to its fall in 1974 faced no formidable urban and/or rural organized mass
movement and did not experience organized armed resistance.
The inception of the revolution as a spontaneous and un-organized upheaval made it clear that
even before 1974 the imperial regime lacked the resources of political organization and
legitimacy to stave off the potential urban opposition and to withstand an uprising of urban
discontent from gaining intensity and inevitable expansion into rural areas where the regime‘s
bankruptcy in many areas became much more obvious.
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The revolution was phenomenal for its spontaneity in that its opening phase was consisted in a
series of mutinies, strikes and demonstration which progressively helped mobilization of the
urban opposition to the regime. The first of the military mutinies was by soldiers and NCOs
(Non-Commission officers) in the small military garrison in Neghelle in Jan 1974. This was
initially ignited by the worsening living conditions by the soldiers but later on took political
overtones when the mutineers arrested their senior officers. It was important in that it indicated
the powerlessness of the regime to control the military dissent and it was followed by other
mutinies in Asmara and Addis Ababa. In fact, these military rebellions were isolated and were
not under any united command.
The teachers and students alarmed by the implication of the new education sector review, which
proposed an expansion of basic education in the country side and a relative restriction on
secondary and university education in towns, erupted into the first demonstration in Addis
Ababa. Tax drivers also went on strike against the government‘s refusal to let them raise fares in
response to OPEC‘s oil price increase.
As far as the urban mass was concerned, for the first time in the history of imperial absolutism in
Ethiopia, they were mobilized by the Central Ethiopian Labor Union (CELU) and staged the first
ever general strike and took on an active role in the upheavals of 1974.
From the above it can be said that as it was started the revolution was a mass based movement
concentrated in urban areas. The relative absence of the rural section in the initial phase showed
the fact of the lack of organized political or military movement prior to the revolution that could
link the urban and the rural oppositions to the regime. The urban groups could not mobilize the
rural sector which otherwise was cut off from the regime.
The imperial regime could not organize the rural community to mobilize it and use it to defend
the system. Well before the revolution the imperial regime already debased from its traditional
power base in rural Ethiopia and the regime proved incapable to construct effective rural linkage
with regional interests, due to failed socio economic endeavors and integration drives and weak
institutional and administrative structures. In general, it can be said that although initially
centered on the urban areas and lacked organized platform,
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events in 1974 showed that both civil society and forces within the coercive and non coercive
apparatus of the state were in different directions moved against the imperial absolutism.
The fact that the imperial regime was overthrown by relatively unorganized mass movement
showed how deeply weak already gone the regime either to deliver the society by its measures to
regain the support of the mass and /or to buy off the armed force and used it against the mass to
impede its rather inevitable collapse. For instance, liberalization measures or reforms by
appointing Endalkachew Mekonen as prime minister proved too little. His efforts to draw up a
constitution that would create a constitutional monarchy which would devolve power from the
monarchy gave no hope of sustaining the imperial regime. Such liberalization moves were seen
little more than an admission of the regime‘s own loss of control in the state system.
Revolutionary Mobilizations in the Ethiopian Revolution
The important consequence resulted from the Ethiopian revolution‘s spontaneous and
unorganized character was the creation of a power vacuum with which the question of who or
what would replace the imperial regime became important.
Post-Revolutionary Order: Different urban groups brought the political overthrow of the imperial
regime. All of those urban actors did not form an organized unit under a unified leadership or
agenda regarding what was to follow leaving open the most important question of who would
control the post-revolutionary order. It was in this power vacuum that the armed force which was
the sole available source of organized political power stepped in and eventually overthrew
Hailesselasse I and took control of the revolutionary process when Derg was established as a
centralizing group within the military.
In a way to absolute power Derg had to fight with groups with in or out and defined itself as an
actor in the revolutionary process defying others who hoped to use it for their own ends and it
emerged as one big contender alongside many others. But before Derg exercise full control of
events, following the down fall of the emperor, there emerged other groups within the Derg and
importantly outside of it that put forward their own version for the post-revolutionary order. The
Derg was constituted out of hundred men drawn from the different
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section of the military departments. The Derg initially lacked a coherent leadership or policy and
was caught by personal, factional and policy disputes. These later on gave way to the effective
dictatorship of groups within the Derg under the dictatorship of Mengistu Hailemariam through a
complex and extremely violent process.
In urban areas the most important power contenders included the Derg, civilian groups (students,
the urban proletariat and the urban unemployed). It was from these urban civilian groups that the
Ethiopian left radicals came out in the form of EPRP (the Ethiopian Peoples Revolutionary
Party) and Meisone (All Ethiopian Socialist Movement). By and large these groups fought over
the control of towns and thereby the control of power in the country.
Another level of power contestant in post-revolutionarily period was between the Derg and
groups which did not take a direct part in the urban upheaval in the initial phase of the
revolution. Groups that fought the Derg at this level were based on rural areas and they battle for
the control of the periphery. Included in this category were noblemen and landlords whose
political position was swept away by the overthrow of the monarchy. This kind of aristocratic
and anti-revolutionary opposition was formally organized into EDU (Ethiopian Democratic
Union) under the leadership of traditional noble men such as Ras Mengesha Seyum of Tigray.
Another category of peripheral contenders took on the form of secessionist movements such as
EPLF in Eritrea, TPLF in Tegray, OLF in Oromia, and WSLF in Somalia etc. The mobilization
process in post-revolutionary order deals with how the different contenders fought out for the
control of towns and urban center and how in the process Derg assumed effective control over
the revolutionary process. The Derg‘s (an Amharic term for committee) participation in the
revolutionary process began as a parliament of the armed force with hundred and eight
representatives from each of the main units of the army (air force, navy, and police).Until the
Derg saw the imperial regime was powerless to prevent any of its activities (e.g. following
Derg‘s arrest of imperial officials) it acted as semi-clandestine power co-existing with the highly
powerless imperial government. It was only after nationalizing
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the assets of the empower, abolishing of the imperial court and deposition of the emperor in
September 1974 that Derg formally began acting like a government taking the title of Provisional
Military Administration Council (PMAC) and began issuing proclamations on its name.
Derg‘s increasing accession to effective power however, was not the result of Derg‘s articulation
of any clear revolutionary agenda. Initially it was characterized by ideological confusion,
factional, personal and policy disputes. Derg, as a result, was very much the making of the
revolution itself as the framework for revolutionary change in the country was articulated by
groups outside the Derg. The lack of coherent program in the part of Derg was reflected in its
first proclamation of its ‗revolutionarily agenda‘, with its slogan of Ethiopia tikdem. The slogan
can not be taken as revolutionary and only showed Derg‘s initial confusion and represented more
of continuity than a radical change. The slogan confused a ‗revolutionary change‘ with a
commitment to vague nationalism or national unity and a commitment to the monarchy only
attacking the corruption of imperial officials. The change it requested was the rather unclear
demand for ‗lasting change‘.
For the civilian groups Derg could not realize any revolutionary change and considered it as an
illegitimate power usurper that only high jacked the Ethiopian revolution. Civilian groups
criticized Derg as having no idea of what a revolutionary change should look like and called for
the formation of a civilian government. It appeared that Derg lacked familiarly with Marxist-
Leninist ideas which most of Derg‘s civilian opponents considered the only way to effect a
revolutionary change in the country. Rather than giving up power to the radical and Marxist
intellectuals who formed the civilian groups, Derg went on maintaining its hold on power by
adopting some of the radical measures demanded by the civilian Leftist groups and went on
considering the possibility of far deeper ‗Marxist‘ changes under its auspices.
The principal ideas and programs carried on under Derg‘s auspices did qualify for a socialist
revolutionary change. But they did not originate within the Derg but within the leftist civilian
groups. To the disgrace of these groups, Derg effectively plagiarized the fundamental tenants and
slogans of the left, robbed their major programs and effectively competed
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with them. If what was demanded by the leftist was a revolutionary change and leadership then
Derg by engaging itself in close imitation of the ideas of socialism which the left introduced and
by producing such great socialist reforms like the land reform made it practically difficult for the
left groups to alienate Derg as non-revolutionary.
With these, Derg even went to the extent of dividing the two important leftist groups in their
view of the Derg especially the two most important leftist civilian groups of EPRP and Mesion.
EPRP and Meison formed by Marxist intellectuals mostly 1975 after the upheaval of the 1974
revolution. By comparison with Derg these civilian leftist groups were late comers to the
revolutionary process. Even without their divergent views about the Derg, the two parties from
the very beginning were far more antagonistic to one another. Each of them regarded itself as the
only rightful Marxist-Leninist Party to eventually succeed to power. The two parties also differ
in their origin, leadership, ethnic balance, goals and tactics. Such divergences were so deep that
the two parties could not able to forge a common ideological front even by their acceptance of
the core values of national unity and strong central government.
Derg‘s increasing stance towards radical socialism was reflected in its programs for
revolutionary change. It replaced its rather vague slogan of ‗Ethiopia tekidem‘ first by the ten-
point program in December 1974 and later by a more radical program of PNDR(Program of the
National Democratic Revolution) in March 1975.The ten-point program although relatively clear
had still combined nationalism and socialism of some kind in what Derg called Ethiopian
Socialism. The first aspect can be seen from the assertion that Ethiopia would remain united
without ethnic, religious and the like differences. The socialist orientation can be seen from such
assertions that outline the state to control the entire economy and the prospect for the
government to nationalize some private enterprises.
The ten-point program cannot be considered as radical enough in the Marxist sense. By
restricting the right to own land to those who work on it only put on the initial blow to some
aspects of Ethiopian feudalism (most notably absentee landlordism) without explicitly
prohibiting private ownership of land.
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In a move to discredit its civilian Marxist opponents and establish its revolutionary credential in
the face of the world socialist state (especially USSR), Derg went on producing a much more
radical socialists measures. The PNDR was worth mentioning here.
In March 1975 proclamation on the nationalization of rural land, Derg abolished not only private
ownership of land granted by the ten-point program but also the different land tenure system of
feudal Ethiopia. The proclamation by declaring rural land the collective property of the Ethiopian
people and vesting formal ownership of land on the state and its actual management to the state
sponsored and controlled Peasant Association, showed Derg‘s increasing radicalization.
These had important impacts on the civilian groups. Their main revolutionary agenda being
taken away by the Derg, they became preoccupied with the Derg no longer on fundamental ideal
of socialism but desperately preoccupied with taking political power away from the Derg.
On principle basis EPRP did not acknowledge Derg‘s socialist credential criticizing it as
militarist with no substantial basis to claim Marxist- Leninist credential. EPRP went on
demanding the establishment of civilian government. Meison, on the other hand, acknowledged
Derg‘s socialist credential and forged what it called ‗critical support‘ to the Derg. This initially
gave Meison a political space to continue its mobilization and relative participation and
domination of the socialist reform together with the Derg.
In addition, Mesion used the coercive state apparatus to fight its main ideological rival, EPRP by
forming a common front with the Derg. For Meison, collaboration with the Derg was only
strategic in which it believed to adopt the Derg, educate it and finally took power over form it.
For the Derg, collaboration with Meison provided it with the intellectual and ideological sources
to purse radical transformation under its auspices. The collaboration between the two in terms of
destroying their common enemy i.e EPRP was successful.
What was infamously known as ‗red terror‘ in Ethiopian history was the result of the relentless
killing pursed by each rival group in their pursuit for controlling of towns and urban centers and
ultimately political power.
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In the first phase of this urban terror (1975-1978) Derg in collaboration with Mesion effectively
destroyed EPRP from its urban base. By mid-1977 the regime in power control over major
towns. After dealing with EPRP‘s challenge, Derg wanted to avoid its dependence on Meison.
The fact that Meison continued working on its own separate organization, continued to build up
its institutional position in the government by dominating such institutions like kebles, the Media
and Political School proved no longer tolerable for the Derg. This formed the second phase of
the ‗red terror‘ in which Derg turned on Meision and drove it out of the government structure
and completed the last and significant of urban based oppositions to the Derg.
Key Aspects of the Revolutionary Outcome and Their Political Implications
Transformation of the Rural Land Relationships
In rural areas, the radical land nationalization proclamation in 1975 abolished the feudal aspects
of rural relation of production and thus abolished the entire economic basis of the landlord class.
The political implications of this radical measure, however, were not similar throughout the
country. The pre-existing pattern of land tenure systems in the different parts of the country sat
in differing contexts of the policy reception.
In the ‗southern‘ areas where landlord class owned large areas of land and where the peasantry
were tenants, the proclamation did remove a major source of exploitation as it provided the
peasantry with access to land. This did win the Derg, at least for some time, support and loyalty
during the critical period in the revolution where Derg needed to consolidate its hold on to power
against its Leftist radical urban opponents.
In the ‗northern areas‘, however, the land proclamation did not have the warmest of receptions. It
was not welcomed in the north because the northern peasantry did enjoy a customary tenure of
one sort or another that ‗secured‘ them effective control over land. As such the proclamation was
seen as a threat. It was seen as a threat because of three reasons. Firstly, the land proclamation
entailed the nationalization of land. Secondly, it entailed land redistribution. Thirdly, it also in
principle removed the peasants‘ traditional right to dispose of their land by making ownership of
land the legal right of the state.
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Politically speaking, therefore, the land proclamation was critical in defining who would be in
the favor of the new regime and who would be against it. The differential impacts of the land
proclamation can be seen from its impacts on the social stratification of the rural community, on
the change in the status of the majority of the peasants in relation to the actual size of their
holdings and as a result on the changes in the agricultural production.
The proclamation by abolishing landlordism redefined the peasantry‘s unequal access to the
means of production by granting every peasant usufruct (user) rights over land. Here is the real
benefit and impact of the land proclamation.
However, the expectations from the land proclamation to result in increased agricultural
production proved difficult. It turned out that the policy assumption was by far too simplistic.
It was assumed that by freeing the peasantry form the landlord exploitation the proclamation
would gave extra incentive for farmers. But the land proclamation did not actually increase the
size of land holding to the peasants. It did actually distributed land that was already under
cultivation by the peasants exposing the land to a greater pressure leading to over cultivation and
further reductions in the size of plots, which with increasing agricultural and ecological
degradation culminated in 1984 famine. As a result, the land proclamation remained in actual
sense a transformation of the legal status in the pre-revolutionary landholding system.
The implementation of the land proclamation had also important political implications that
influenced and shaped the Derg. It was proclaimed in the early stage of the revolution where
Derg had to deal with the intensifying challenges in the urban areas and at the time where it
lacked administrative capacity to implement it. As a result, Derg‘s insistence to carry on the
implementation of the proclamation marked a critical phase in the revolution. It represented the
expansion of the revolution throughout Ethiopia from its essentially urban context into the
otherwise ‗distant‘ rural Ethiopia.
By establishing rural Peasant Associations (yegebere maheberat) as peasant self-administering

units with powers to confiscate and distribute land, Derg in practice left the
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implementation of the land proclamation to the peasants themselves. To this effect the regime
sought to mobilize 50,000 students and teachers from urban areas under the program commonly
known as the zemecha (National Development through Co-operation Campaign) to assist the
Peasant Association.
For the regime the mobilization helped it compensate for its weak administrative capacity. As the
participants in the zemecha were potential and actual opponents to the regime in urban areas, the
program helped the regime remove them from the urban centers where they could directly
threaten the regime. These were not, however, without risks. The mobilization often resulted in
the mobilization of the rural political force with and by the urban political forces against the
regime as the urban based opponents to the regime used the opportunity to infiltrate the zemecha
participants to establish link with the rural community and to recruit for their revolutionary
armies.
In general the basic institutional units and frameworks for further consolidation and organization
of the rural community were laid by the process of zemecha. Later on Derg maintain these
institutions as part of its local government structures a stable framework of political order and
institutionalized power. These institutional frameworks gave a relatively stable political order
until the Derg regime was challenged by more stronger and rural based oppositions which
brought its down fall in 1991.
The Ethiopian Revolution and the Question of Political Democracy
The institutionalizations of power by the Derg regime were aimed at designing the means of
control in the urban and rural areas. Derg‘s structures of control were shaped by the
revolutionary dynamics that gave it unlimited power to regulate the life of citizens. Conceiving
state power in Marxist-Leninist terms, Derg institutionalized power by more brutal way.
New proclamations which created new offices were issued to increase the power of the
government and to bring the judicial process more closely under its control. The regime
enhanced its control over political power by prohibiting any independent political movements as
illegal and counter revolutionary.
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The regime‘s basic means of control was the armed forces. The regime increased the size of
armed forces eight fold. It also organized local militia groups and adjoined a military branch in
every of its local administrative units such as Urban Dwellers Associations (kebeles) in urban
areas and peasant associations (yegebere maheberat) in rural areas. The Derg period saw huge
militarization of state and society. For instance, the regime proclaimed national military service
which demanded Ethiopians aged between 18 and 30 to provide a two year effective and
compulsory military service.
A second means of control was the Ministry of Public and National Security. This created an all
pervasive security network throughout the country to monitor at close range every activity of the
politically active section of the society.
Another means of control was the Workers Party of Ethiopia (WPE). The WPE was a disciplined
and centrally controlled party for implementing the policies of Derg. Because WPE maintained a
network of political organization over every other institutions in the country such as the military
and the various mass organizations and local government structures it provided Derg with a
common and effective administrative and control framework.
All of these institutional establishments showed Derg‘s authoritarianism and its increasing
disinterest towards the demands of political democracy. The institutions were designed to
reinforce and legitimatize Derg‘s desire to maintain its absolute control.
By creating the WPE, for instance, as the only legitimate political party and putting all other
aspects of mass organizations under its strict control, the regime curtailed political development
in the country. Until its downfall, Derg controlled and managed power through a centralized,
enlarged party-military apparatus which effectively denied a real power transfer to the Ethiopian
population.
Derg and the Crisis of the Rural Economy
The crisis of the rural based agricultural economy formed one of the structural sources of the
Ethiopian revolution. Derg‘s ‗socialist‘ approach to this was underpinned by the assumption
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that the peasantry once freed form landlord exploitation and given a security over land would get
incentive to scale up production.
The nationalization of the rural lands achieved the first aspect in that it destroyed the landlord
class and ‗restored‘ the means of production (land) to the producers themselves. By this Derg
appeared to remove the main institutional obstacle to rural production in the ancien regime.
However, Derg pursed other policies that in practice created another structural or institutional
obstacle to agricultural transformation. Its ‗socialist‘-informed commitment to a strong state
command economy together with the pressure on the land (due to frequent land redistribution)
and the creation of new governmental extractive mechanisms(state farms, agricultural producers
cooperatives, villagization, Agricultural Marketing Corporation and the like) imposed on the
peasantry brought sharp decline in agricultural production. In the economic sector Derg wanted
to exercise strong state control over production and distribution.
To control production and ultimately the producers the regime organized peasants into
Agricultural Producer‘s Cooperatives (yegeberawoch yehebert sera maheberat). These
cooperatives were composed of peasant families under a peasant association pooling their
resources to produce in common. In spite of Derg‘s commitment to encourage peasants to form
cooperatives, through such incentives as allocations of good land, access to credit and services,
majority of the peasants remained non-volunteer to form cooperatives.
As such the intention to raise rural production through cooperatives did not succeed. In fact the
cooperatives happened to create income gaps as those who benefited were mostly the leaders of
such cooperatives. Like every other of Derg‘s rural policies and the resultant institutional setups,
the cooperatives ultimately end up being mechanisms of controlling the peasantry.
Derg‘s desire to control distribution can be seen from its establishment of the Agricultural
Marketing Corporation (AMC) in 1976. The AMC was established to buy agricultural produce
from farmers for domestic consumption by compelling the peasantry to sell their produce to
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the government at substantially less than market price. Because the regime organized the
peasants under the state farms and producer cooperatives and because it brought those under its
direct control the government was able to transfer peasant‘s produce through the AMC.
In general, the promise of the land proclamation to increase agricultural productivity under
Derg‘s Marxist-Leninist political economic framework was a failure. Derg‘s insistence for the
need of large scale production through state farms, producer cooperatives and villagization
together with government-controlled mechanisms of distribution proved to be more fundamental
structural detects.
The „question of nationalities‟, the Revolution and Derg
The nature of the ‗question of Nationalities‘ or political ethnicity in Ethiopia has been associated
with the pattern of the Ethiopian state formation. The pattern was based on the building of the
Ethiopian state around a central Ethiopian nationalism which subjected many different peoples to
a generalized Orthodox Christian and Amharized identity in a process that involved territorial
annexation, land alienation and great deal of exploitation of the people.
The ‗nationality question‘ that the period of Derg saw in its critical status was the combined
outcome of three interrelated elements. These are the pattern of state formation, the pattern of
socio- economic change and the effects of the 1974 revolution.
The pattern of state formation eventually gave the Amharic language, culture and identity a
quintessential status. From time to time the definition of the so called Amharic culture as a
national and implicitly superior category defying the status of others became reinforced by the
imposition of central control and accompanied by substantial level of physical force and
economic exploitation.
The Showan core and its association with the creation of the modern state and the central statist
ideology progressively reinforced the idea of equating Ethiopian nationalism with an orthodox
Christian and generalized Amharic identity as the basis for an inclusive Ethiopian nationalism.
This aroused resentment not only from those newly incorporated areas but also
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from those who were historically part of the Ethiopian core (such as Tigray and Eritrea). The
pattern of state formation therefore set in motion the general background for ethnic politics.
Built-in the historical patterns the social challenges that accompanied the consolidation of the
modern state further gave ethnic politics its shaper manifestations. The social changes were
associated with the emergence of an export capacity with agricultural products such as coffee,
hides and skin with which the pre-revolutionary imperial regimes wanted to enhance the state‘s
capacity and access to modern institution, technology and armaments.
For social-economic reasons, this export economy together with the evolving domestic cash
economy created by urbanization and spread of communication was heavily concentrated in the
center and south of the country. The export economy shifted the central position of dominantly
cereal producing subsistence farming of the northern areas into the cash crop producing southern
areas. As a result the new economic reality made the northern highland to be marginalized with
its dominantly subsistence economy.
It was, therefore, not primarily the nature of the state as a representative of a single ethnic group
or nationality that gives objective condition for the emergence of modern ethnicity in Ethiopia. It
was rather the uneven economic changes which tended to run counter to the pattern of political
exclusion and inclusion from the historically dominant role of the northern areas that accounted
for the politicization of ethnicity in Ethiopia.
The increasing politicization of ethnicity and the definition of the state an Amhara state were
reinforced by the political economic factors that accompanied the consolidation of the modern
state and central position assumed by the Showan groups from the northern area. Whereas the
economic changes at the country level led to the incorporation of the southern areas, the historic
north found itself economically neglected and its politically active elite politically alienated.
Regarding how to deal with the ‗question of nationalities‘ in the Ethiopia revolution major
participants shared the idea that the national political culture in the pre-revolution period was
largely defined in terms of the language, religion and values of the northern area and the
Amharic core in general and in particular respectively.
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Derg‘s position in this regard was both continuity and change from the pre-revolutionary period.
In a similar fashion to the old order, Derg continued to uphold the idea of national unity although
it determined to do so by divorcing Ethiopian nationalism of the earlier period from the religious,
social and cultural trappings of the past.
Derg only attempted to confront ethnicity as a cultural issue and sat about redressing the
‗wrongs‘ of the past. Its cultural orientation included denouncing the ‗Abyssinian chauvinism‘ of
the past regimes, allowing the printing, broadcasting and teaching of other languages, raising the
status of Islam by recognizing Muslim holidays, debasing Orthodox Christianity from its official
status, proclaiming the equality of all nationalities and cultures and promising regional autonomy
and self-government.
Derg, by overthrowing the economic basis of the feudal order and the social basis of economic
exploitation claimed to have ended the nationality and class oppression at the same time.
However, the nationality question during the Ethiopian revolution continued to became even
more politically sensitive.
First, Derg no longer wanted to give the political significance of ethnicity and the resultant
nationalism in Ethiopia by reducing the national contradiction to cultural
oppression which would only require cultural emancipation of formerly subordinate groups. By
its emphasis on cultural emancipation, Derg‘s approach to Ethiopia‘s ‗question of nationality‘
can be categorised as one of ‗cultural nationalists‘ who believe that the cultural life of the nation
must be allowed to flourish and develop. But ‗cultural nationalists‘ do not necessarily view the
political demands of the ethnic or the national groups on the basis of a general will (often
understood as an historic purpose) that must be allowed to govern itself, to control the national
homeland, and if necessary to assert its rights against other nations.
Derg as cultural nationalist claimed to subject the political demand of nationalist groups to a
political environment that would only provide enough freedom for different ethnic groups a right
to local self-administration viewing a political demand for national self-determination including
secession by nationalities as a threat to the integrity of the Ethiopian state and was not tolerant of
those.
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Second, Derg‘s approach to the question of nationality and its ways of institutionalizing it was
far from acceptable to its opponents. Derg‘s formal recognition of the rights of ethnic groups to
national cultural emancipation rapidly became meaningless and unsatisfactory.
Derg‘s promise to decentralize self-government and regional autonomy was practically less
substantial in that it monopolized and centralized power and did not tolerate any independent
expression of regional identity.
It was unsatisfactory because there were important ethnic based militant nationalist groups
(which can be differentiated from cultural nationalists and can be labeled as political nationalist)
which saw the right to self-determination to include the right to secession by claiming the
nationality question as the primary political contradiction in Ethiopia.
Derg‘s nationalist opposition groups articulate what they believed should be the political
significance ethnicity form such an understanding that the key political character of ethnicity in
Ethiopian context must be seen in terms of each nations in Ethiopia as having its own character
that demanded the political freedom to develop in its own way to flourish and it cannot be made
subject to laws designed for another people.
For these nationalist and rural based groups (such as EPLF, TPLF, OLF etc) which brought
Derg‘s down fall in May 1991, cultural emancipatory policies pursued by the Derg regime and
Derg‘s attempt to depoliticize ethnicity could not deter them from claiming to a redrawing of
political boundaries in Ethiopia in a way that respects the national identities of the peoples in
question, whether these are claims for a harder boundaries between states ( as demanded by the
EPLF in Eritrea and OLF in Oromiya, or the softer boundaries that divide, for example, the
members of a federation( as later on preferred by TPLF and OLF) or a confederation.
The political economic conditions that gave ethnicity a sharper political manifestations during
the Derg period was the combined outcome of economic failure, institutional decay and effective
use of ethnicity for political mobilization against Derg‘s centralizing approach and its huge
political and military repression.
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In the northern areas especially in Eritrea and Tigray the collapse of subsistence economy
together with population pressure, land degradation, uncertain rain fall, policy neglect, the lack
of producing a viable export commodity that would tie the areas with the international economy
contributed to its continued economic marginalization and the resultant political alienation and
the region‘s huge vulnerability for politicization of ethnicity. Here, the land proclamation did not
win Derg any substantial support. If anything the nationalization of land was seen not so much of
liberating as the proclamation took away the peasants‘ traditional control over their plot.
In southern areas, the regime could not capitalize on the initial political support provided to it by
the land proclamation. The intensified exactions of the government through increased tax on
export production which the area was the main source and the imposition of grain production
quotas cancel the initial gains of the southern peasantry.
At the country level, Derg‘s increasing demand for military conscription was also economically
burdensome. The villagization campaign which herded the peasantry into centralized villages
had the negative outcome on reducing peasant work morale and reduced their productivity only
enhancing the regime‘s control over the rural mass. The net effect of AMC was also disastrous
like that of the producer‘s cooperatives. Derg‘s multifaceted failures at different levels
contributed to the militarily mounting nationalist opposition to made use of ethnicity as the best
tool for political mobilization by the rural based nationalist groups and to further alienate the
Derg regime away from the people. Politicization of ethnicity at last become effective mobilizing
agenda for aggregating the resentment against the Derg regime which culminated in the victory
of ethnic based groups in Ethiopia in post 1991 period the chief architecture of which is EPRDF.
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CHAPTER FIVE
Post Derg Ethiopia: EPRDF
A new dispensation in restructuring the Ethiopian state along ethnic federalism began to unfold
in 1991. The Tigrayan People‘s Liberation Front (TPLF), under its umbrella organization, the
Ethiopian People‘s Revolutionary Democratic Front (EPRDF), assumed state power in May
1991. Some of the measures undertaken by TPLF/EPRDF reflected the same pattern of
marginalizing prevalent in Ethiopian politics. The Workers Party of Ethiopia (WPE) of the
deposed Derg regime was immediately abolished, top-level former government officials were
dismissed and the army was disbanded. Largely, the fall of the military regime was not only seen
as the fall of a regime, but as the collapse of the modern state formation that had been in the
making since the late nineteenth century.
The July 1991 “Peace and Democracy Conference”
The National Conference on Peace and Democracy in July 1991 was organized as the foundation
for a transitional period after the regime change. However, the conference had excluded many of
the political groups from participation. The conference largely included selected individuals and
over 20 political organisations handpicked by TPLF/ EPRDF. Those who were encouraged to
participate were predominately ethnic-based groups, which were either already in existence or
organised immediately prior to the conference.4 Multi-national organisations or other ethnic-
based organisations that might pose a threat to the new status quo were systematically excluded
from the process. The remnants of the student movement, the Ethiopian Revolutionary
Democratic Party (EPRP) and the All Ethiopian Socialist Movement (Meison) were not invited
to attend the conference.
A major setback of the conference was a firm control and domination of the process by
TPLF/EPRDF. The TPLF/EPRDF managed the conference and kept participation and the
eventual outcome firmly under its control. In light of this, the outcome of the transitional
conference, the transitional charter, is therefore more a result of an agenda predetermined by
the EPRDF and partly by the Oromo Liberation Front(OLF), rather than a pact between all the
organisations that participated at the conference.
The Transitional Charter
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The transitional charter served as interim-constitution that governed the Transitional Government
of Ethiopia(TGE) until 1994. The principles incorporated in the charter largely reflected the
political programme that had been advocated by TPLF/EPRDF. The charter accepted the rights
of all of Ethiopia‘s nationalities to self-determination, including secession and established local
and regional councils based on nationality. Accordingly, the country was divided into 14
administrative regions called kilil. The conference had also established ‗an 87-member Council
of Representatives (COR), in which the largest number of seats was held by the TPLF/EPRDF.
The most serious shortcoming of the conference was its disregard of

multinational organisations in general and pan-Ethiopian nationalism in particular.
A crucial aspect of decentralist and Balanced federalist ideologies is that the
federal bargain should be based on a covenant, where The various political forces
in the country voluntarily agree to make arrangements for power-sharing and the devolution of
power. In light of this principle of federalism, there are two major political forces that need be
considered in the Ethiopian context, namely pan-Ethiopian nationalism versus ethnic
nationalism. Disregarding this fundamental reality, the transitional charter was devoted solely to
the ‗right of nationalities‘ and overlooked pan-Ethiopian nationalism that had been in the process
of crystallization in previous decades.
Ethnic Federalism in Post 1991 Ethiopia: Theoretical Arguments for and Against
Justifications/Arguments for Ethnic Federalism
What moral or instrumental reasons justify granting an ethnic group the right to form its own
political community-that is, what is it about ethnic community that justifies its use as a basis for
redesigning states?
The Ethno-nationalist Argument
Ethno-nationalism is the belief that the distinctiveness of a particular people and their right to
self-rule in their homeland. The right to self-rule can be satisfied through a variety of
institutional arrangements. These are the right to secede and establish an independent state
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and regional autonomy within a federal. In either case, the ethno-nationalist principle requires
political communities to be defined in such a way that political and cultural (or ethnic)
boundaries must, as a matter of right, coincide. To ethno-nationalists, such a framework is
essential because it allows ethnic communities to live in accordance with their customs and
traditions and to use their own languages.
Promoting the Value of Community
Proponents tend to cast ethno-nationalism as a force for the good in an instrumental role, and
suggest that possession by ethnic groups of their own state-or a greater degree of political
autonomy than is possible under a unitary state-is essential to preserve or promote certain values
individuals need.
A useful way to appreciate this claim is to focus on the needs ethnic community satisfies. While
individuals have many identities, membership in an ethnic community provides them with a
primary form of belonging. This membership serves as an anchor for people's self-identification
and the safety of effortless secure belonging. Membership in an ethnic community provides
individuals with a cultural context in which they are able to make meaningful choices about how
to lead their lives, set their goals, and establish relationships. It also shapes the individual's
opportunities and his or her ability to engage with relative ease in the kinds of relationships and
goals marked by a culture.
Proponents argue that by devolving power to territorially concentrated ethnic groups federalism
provides a framework in which the more overt manifestations of ethnic distinctiveness,
especially culture and language, may be publicly expressed and nurtured.
Promoting Equality
This particular justification relies on the moral imperative that all citizens be treated with
genuine equality. Most African constitutions prohibit discrimination on the basis of ethnicity and
provide for equal rights for individuals regardless of their ethnic identity. Such a vision of
equality is evidently sound, but it assumes that the state stands above and is benignly neutral
with respect to ethnicity. It is a common complaint in many African states, however,
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that one or two ethnic groups either so dominate the state or are so identified with it that other
ethnic groups feel excluded from the governing coalition. Equally important, the claim of state
neutrality is severely undercut in cases where an ethnic group receives no official support or
equal recognition for its language or culture.
For proponents, the major value of ethnic federalism lies in its sensitivity and responsiveness to
the volatile emotions associated with feelings of subordination that result from lack of esteem for
one's culture and language. An institutional framework that allows all ethnic groups to manifest
their cultures and languages publicly and equally will forestall this result and educe the feelings
of ethnic mistrust and suspicion that trouble ethnically divided societies.
The Democratic Argument
From a utilitarian perspective democracy is the form of government most likely to secure the
interests of the greatest number of persons subject to governmental authority. Accordingly,
democracy is not an end in itself but a means by which individuals maximize their interests by
aggregating their private preferences. Interest aggregation, however, is likely to prove difficult or
even unattainable if a polity is characterized by too much ethnic diversity and rivalry. Proponents
argue that ethnic federalism offers the best institutional framework, short of independent
statehood, for aggregating the interests of the members of an ethnic group and for promoting
democratic governance. This is the utilitarian view.
A second version of democracy-republicanism--offers a different argument in support of ethnic

federalism. This vision focuses on ethnic federalism's potential to create for citizens an enabling
environment in which they can consider the common good in their public deliberations and
political participation.
Deliberation promotes or achieves political outcomes that are supported by the consensus of the
community. Yet, the argument that too much diversity will strain citizens' ability to deliberate on
the common good is especially pertinent in the ethnic context. Under these circumstances, ethnic
federalism might provide a suitable framework for promoting
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deliberation and achieving consensus about the common good at the subunit level because the
group's members share broadly similar interests, culture, and traditions.
Ethnic federalism may also offer advantages in terms of citizen participation. In the republican
view, citizen involvement in the deliberative process is most easily accomplished in small and
decentralized political units. An individual is more likely to be involved in or concerned about
the affairs of his or her own immediate community than the affairs of the national community.
Economic Arguments
Ethnic federalism might be justified on economic grounds as well. A familiar economic

argument stresses federalism's potential for inducing or fostering competition among the
constituent subnational jurisdictions. Federal subunits could provide a necessary foundation for
fostering economic competition, expanding resources, and enhancing the efficiency of a nation
as a whole. In this view interstate competition provides incentives for jurisdictions to adopt
policies and strategies of economic development that are likely to retain or attract desirable firms
and individuals and that will replace poorly chosen strategies with variants of strategies that
appear to succeed elsewhere. As a result, jurisdictions that are reluctant or fail to adopt favorable
economic policies wi11 likely face declining economic activity.
If the national government has a monopoly of regulatory authority over the entire national
economy the positive effects of competition are unlikely to be realized. Where subnational
governments lack primary economic authority, the arrangement, though federal in name,
provides few or no incentives for subunits to compete among themselves. Ethiopia's federal
structure is illustrative. Ethiopia's federal government shares little of its political or economic
power with the subnational governments. Without access to these resources, the subnational
governments lack the freedom to experiment with different development strategies that an
appropriately nuanced federalism might otherwise allow.
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A properly structured and genuine federal system may offer additional economic benefits. Such a
system allows subnational governments to serve as semi-independent and entrepreneurial poles
of development, both for resource mobilization and for the provision of public goods and
services in a manner that is more responsive to citizens' needs and demands than provision by a
single central government. Being closer to the people, such governments have greater access to
information about the needs, preferences, and local conditions of particular groups of citizens
than a remote national government would have. The identity of interests between an ethnic group
and its state government also helps improve economic performance because it might be far easier
for a government to mobilize a people united by ethnic and linguistic loyalties than one which
are not.
Finally, such a form of government might offer ethnic groups greater opportunities for control
over local resources and revenues, and provide a basis for spreading some of the benefits of
development among subnational jurisdictions.
National Unity and Political Legitimacy
This is an argument for ethnic federalism that is derived from what John Rawls refers to as the
"fact of pluralism. By itself, pluralism is unremarkable. But when politicians imbue ethnic
differences with political salience, ethnic groups gradually come to entertain divergent
conceptions of citizenship based on such differences. The alternative option of federalism thus
constitutes a compromise between those favoring a unitary state and those favoring the
dissolution of the state or the separation of some portion of that state. Further, as a compromise,
ethnic federalism provides a sound strategy for promoting national unity and political legitimacy.
The creation of distinct ethnic homelands with cognate rights of language, culture, and self-
governance will help• to blunt the ethno-nationalist desire to possess one's own independent
state. The argument is that if an ethnic group can be convinced that their national state is already
a fact, secession becomes a logical extravagance. By thus constituting each ethnic group as a unit
of self-government, ethnic federalism might be said to guard against the problem of rule by
remote leaders having insufficient identification with or knowledge of subunits.
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Justifications/Arguments Against Ethnic Federalism
The dangers of ethnic federalism
Arguments against ethnic federalism can be approached through three fundamental and
inextricably linked problems: threats to national unity, lack of economic progress, and persistent
and pervasive abuse of human rights.
National Integration and Political Stability
Ethnic-based federalism is often a poor constitutional approach for the purpose of forging unity
among the variety of ethnic communities. Indeed, this form of government seems inherently at
odds with them. To begin with, federalism, even when it is not coupled with ethnicity, has
generally not had a distinguished record as a stable form of government. It is noteworthy that
virtually every federal state of any standing has had sooner or later to face a concerted bid for
secession by one or more of its component regions. This fact diminishes enthusiasm for such a
system of government especially when one considers that even a "philosophically and legally"
sophisticated federal system-that of the United States-has not been spared the tragedy of a costly
civil war due to separatist demands.
Federalism's track record as a source of instability and secession might well advice against
choosing this form of government for these states. Yet, it has not been shown that a unitary form
of government is immune to these dangers. In fact, the reason why a federal form of government
is chosen over a unitary form in the first place is to accommodate preexisting and divergent local
interests that cannot bear centralized rule.
Given that the government systems that are presently destabilizing most African states are
unitary and centralized, a well-considered and appropriately nuanced federal system may be the
only viable way to accommodate these divergent interests. The marriage of federalism with
ethnicity, however, invokes too many difficulties to be viable or workable. By its very nature,
such a system relies on dividing citizens along ethnic lines and institutionalizes their division.
Once reified in this way, ethnic differences have very little chance of fading away over time.
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Indeed, when the state deliberately uses ethnicity as a source of political identity, citizens who
might not have been aware of their ethnicity will regroup under its banners purporting to be a
distinct people. The formal division of a country into so many ethnic sub states is thus bound to
create "strong incentives for members of each ethnic community to live in what they will
perceive as their own sub-state.
Similarly, far from encouraging leaders from different ethnic groups to use the political process
to work together toward a shared national goal, ethnic federalism provides the leaders of each
ethnic group with incentives to separate themselves from other groups' leaders and to separate
their people from other ethnic groups. As a result, the various ethnic communities exist "side-by-
side, but will not integrate.
It is true that in many African states ethnic groups are already geographically concentrated in
separate regions of the country. Nonetheless, deliberately giving explicit constitutional
recognition to such division formalizes and exacerbates the physical and psychological
separation of the groups, thereby hindering efforts to promote their interaction and intermingling.
Where ethnic groups are too absorbed with the pursuit of their own interest it becomes difficult
for the national government to promote the common good, to forge national consensus, or to be
otherwise effective. Because such a system of government lacks any intrinsic bond that fosters
cooperation, sharing, and mutual solidarity. Far more serious, such a system remains vulnerable
to the threat of desertion by one or more of the constituent subunits. As a result, the continued
existence of the national community is always provisional and contingent. An ethnic based
autonomy for ethnic groups may simply fuel the ambitions of nationalist leaders who will be
satisfied with nothing short of their own nation-state. In the hands of ambitious ethnic leaders,
the existence of independent ethnic governments will serve as a means for "collating,"
articulating and disseminating ethnic demands and grievances against the central government. As
this identification solidifies, citizens will gradually withdraw their identification with and support
of the central government. These arguments suggest that ethnic-based federalism is seriously
flawed as a
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mode of governance because it necessarily gives rise to two very divergent and potentially
conflicting visions of citizenship: national and subnational.
The struggle between these two forms of citizenship has often resulted in disastrous civil wars,
economic dislocations, ethnic cleansing, and the internal displacement of large numbers of
people. These difficulties are not limited to authoritarian federal states. Even democratic states
have not succeeded in eliminating the risk of national fragmentation, economic dislocation, or
population transfer. For example, Canada and Belgium have been among the most prosperous,
benign, and socially just nations in the world, yet the separatist demands of their French-
speaking citizens have only increased in intensity.
Economic Development
From the standpoint of economic development, ethnic federalism appears an unsound

institutional arrangement. To begin with this form of governance is marred by its great tendency
to be a source of endemic political instability and constitutional insecurity. There are at least
three reasons why ethnic federalism may impede economic progress.
First, it has the potential to restrict the mobility of labor, goods, and capital across subnational
jurisdictions, and thus to undermine the notion of a common market. Emphasizing ethnicity leads
to an attitude of intolerance and exclusivism on the part of members of these communities. Such
an attitude negates the theory of interstate competition on which ethnic-based federalism might
otherwise be justified. According to this theory, a federal structure promotes gains in efficiency
as its constituent subunits compete with one another to attract mobile factors of production.
Consequently, a state that fails to offer an appeal in combination of low taxes and high quality
public services risks losing investors and productive labor to other parts of the federation.
But where subnational jurisdictions are deliberately made to coincide with and highlight ethnic
divisions in order to nurture the political aspirations of ethnic groups to become nation-states, the
theory of interstate competition loses its credibility. In such a polity, the
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emphasis given to ethnic identity and community generates such powerful ethnic allegiances and
rivalries that even capital, labor, political parties, and many other sectors of social life 'are often
organized along ethnic lines.
Second is the notion that because they are designed to be "ethnocratic" to the core, subnational
governments essentially view themselves as agents of their own ethnic communities. As agents,
ethnic leaders inevitably face incentives to create or enforce barriers to inter jurisdictional factor
mobility. They also face pressures to pander to their ethnic communities, or portray themselves
as strong advocates of their communities' interests. Thus, when an ethnic group controls or
otherwise becomes identified' with a particular substate, its agents will generally seek to define
distribution and control of economic assets including land, capital, credit, and licenses to operate
commercial and financial enterprises so as to benefit their own ethnic constituents. Process,
market rules of competition are either superseded or otherwise manipulated, with the result that
members of other ethnic communities are excluded from participation in the local economy.
Ethnic federalism exacerbate, rather than reduce, inter jurisdictional disparities in wealth. Vast
differences in human and natural resources separate ethnic groups. Some ethnic groups may be
well endowed with oil deposits, or other mineral resources; they may have large populations, or
may inhabit economically important regions, such as port cities. In contrast, other ethnic groups
may lack these attributes.
All ethnic groups may benefit by pooling together their respective resources in a federal
arrangement. But given the tendency of ethnic governments to view themselves primarily as
agents of their own ethnic groups, they have little or no incentive, much less any sense of
obligation, to share any of their resources with other ethnic groups. On the contrary, ownership
of important resources may foster in them an attitude of economic self-sufficiency, and a
willingness to go it alone politically. Thus, a federal structure that emphasizes ethnicity alone is
bound to lead to uneven economic development, or may fuel demands for political separation as
the central government attempts to redistribute resources among the subunits more equitably.
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Third ethnic federalism tends to encourage, even require, political leaders to view themselves
primarily, if not exclusively, as agents of their own ethnic communities. Preoccupation with
ethnic interests, however, will from time to time conflict with the interests of the nation as a
whole. An ethnic-federal system may similarly taint decisions by the central government.
Although the central government may more clearly and dispassionately perceive the benefits of
pursuing an economic policy aimed at enhancing national growth, it may nevertheless be
compelled to forego these benefits in an effort to thwart the danger of inflaming ethnic passion
that could destabilize the federation.
Even if the common national interest is not so frustrated, an ethnic- particularist view of
economic interests increases the costs of reaching agreement on important economic policies
affecting the whole nation. A genuinely ethnic-federal arrangement, by its very nature, requires
all important decisions to be made with the consent of all ethnic groups. Achieving consensus
among all ethnic groups, however, would be cumbersome because different ethnic groups have
different preferences for particular national policies. Consequently, polarized preferences lead
either to a deficit of public policies or to a delay in the implementation of such policies.
Human Rights
The third area of concern with the viability of ethnic federalism involves its impact on the
enjoyment of human rights by persons belonging to ethnic minorities. Ethnic federalism is
primarily concerned with devolving power to a set of subnational jurisdictions in which ethnic
and political boundaries are deliberately made to coincide. It is, of course, impossible to achieve
absolute coincidence of ethnic and political boundaries. As a result, subnational jurisdictions
necessarily contain ethnic minorities. The status and treatment of these minorities within the
jurisdiction present myriad opportunities for abuse and deprivation of rights.
From a human rights perspective, ethnic federalism is inherently problematic. First, reliance on
ethnicity as the sole basis for restructuring a state is fundamentally at odds with the universally
accepted principle of non-discrimination embodied in various U.N. instruments.
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By conferring sovereign powers on an ethnic group, ethnic federalism allows a group to control
the apparatus of government within the subunit and to put its own authority on the identity of the
sub-state to enhance its status as a political community and privilege its members as individuals.
Under this system, those who do not belong to the ethnic majority are considered "outsiders" and
are liable to be excluded or subordinated within their respective sub-states.
Finally, ethnic federalism infringes on international human rights norms that guarantee citizens
the right to move freely and to reside wherever they choose within their country. Because
employment opportunities, political power, and rights of political participation all depend on
belonging to the "right" ethnic group, those who do not belong have no incentive to move into
areas controlled by such a group. And those who are already in the "wrong" ethnic region face
the prospect of being expelled from their lands, fired from their jobs, and forced to return to their
"homelands." Ethiopia's experiences to date demonstrate as much.
In general by deliberately and openly highlighting ethnic differences that would otherwise fade
in time, ethnic federalism corrals citizens into ethnic enclaves, encourages aggressive ethnic
identification and separatism, and exacerbates ethnic distrust and social discord. The political
process is bound to be fractious and contentious as well, as every group tries to maximize its own
narrow interests, or as one or more of these groups strive to satiate its ultimate ethno-nationalist
desire-the creation of an autonomous nation-state.
Ethnic Federalism in Post 1991 Ethiopia: An Empirical Assessment
Introduction
It has now been nearly three decades since an ethnic based federal state structure was adopted in
Ethiopia following the 1994 Constitution. There has not been any change of government since
then and the system has been in operation with the blessing and support of its hegemonic power
bloc-the TPLF (Tigrean Peoples Liberation Front) led coalition of junior partners under the
umbrella of the EPRDF (Ethiopian Peoples Revolutionary Democratic Front). The real strength
of any system of government is to be judged based on the system surviving its partisan creators
and enforcers. Can we say with
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certainty that this will be the case in Ethiopia? Some even ask the worrying question whether
Ethiopia itself, as we know her today, will survive the TPLF/EPRDF Coalition. This is a very
difficult question to which no one can give a definitive answer.
Some contest the idea that federalism was introduced into Ethiopia for the first time by the
EPRDF. Whether it was during the Axumites; the Zagwes; medieval Abyssinia or in the
territories of the various nations annexed into Abyssinia-there had always been a notion of
federalism or that of shared rule between the centre and its constituent territories. Ethiopian
emperors did not assume the title of ―King of Kings‖ without a reason. The occasional incursions
of Abyssinian medieval kings into independent kingdoms in the South and East bordering their
empires never fully stripped the powers of the local rulers. This means regional autonomy has
always been a feature of Ethiopian system of government. Even Emperor Menilik II who is
known for his empire expansion role and annexation of tribes and nations bordering his
traditional boundaries, did leave some measure of self-rule to local kings who recognized him as
their emperor e.g. Jimma Abbajifar and Kingdoms in Wollega. This regional autonomy,
however, was not accompanied by individual rights and freedoms for the subjects of these
kingdoms, with the notable exception of the abolition of slavery.
The last blow to regional autonomy was Hailesselasse‘s centralization policies which continued
unabated during the military rule of the Derg. One can conclude that EPRDF‘s federal system of
government is a mere reversal of unitarism which took hold during the last two governments.
However, many critics would point out that such reversal has been a matter of form but not of
substance.
Thus, there is no doubt that the notion of regional autonomy is a desirable form of government
for a large and diverse country like Ethiopia as well as to hasten the country‘s economic
development. The problem is not with the notion itself but with shortcomings in its design and
the assumptions underlying the system. These shortcomings and assumptions combined with
incompetent implementation results in making the end product a poisoned fruit. The following
sections will discuss these short-comings and misguided assumptions of ethnic federalism in post
1991 Ethiopia.
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Lack of full-hearted commitment to the project of a new federal Ethiopia
Commitment to a federalism project has to be full-hearted. However, the makers of the FDRE
constitution are not fully committed to the modern federal Ethiopia project. The Constitution is
based on the assumption that if this daring experiment succeeds, that is fine, if not we can pack
up the willing pieces and move on and establish our independent fragmented. One either wants to
be with Ethiopia or not, and that has to come out loud and clear in the constitution. It is
important to look at the history of the TPLF to understand this half-hearted modern federal
Ethiopia project. It is possible that political parties change their views over time and TPLF might
have shifted its position on paper, but this shift has not been decisive and its intermittent
nationalism is viewed suspiciously.
Lack of unwavering commitment to human rights and rule of law to counter the appeal of
secession
Those who promote ethnic federalism must make sure that human rights are respected to the
fullest. This is because federalism of the type we are practicing is competing with the very
tantalizing prospect of secession. In other words, the level of respect for human rights and rule of
law has to be strong enough to counter the new passion for nationalism made possible due to the
organization of regional states along ethnic lines.
Too big a regional state whose departure can threaten the viability of the federation
When a new federalism is designed from a scratch, especially of the ethnic federation type, no
member of the Federation should be allowed to be so big so as to threaten the viability of the
whole Federation. This problem is afflicting even mature federations such as the one in Belgium,
where the most prosperous Dutch speaking part has upped its intransigence to the extent of
paralyzing the government and threatening the very existence of the country. It has not always
been like this since in the past the French speaking part was more powerful.
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If this is happening at the very heart of the European Union, what guarantees do we have, here in
Africa, with lesser protection of human rights and respect for the rule of law?
Just assume that, the regional state discovers that it sits on one of the most lucrative natural
resources, such as a huge oil deposit that could last for generations, and then wait and see if the
state would want to continue to put up with and subsidize other whining members of the
federation which did not turn out to be as lucky.
Constitution is for generations and we cannot slice and dice States every now and then causing
further chaos. As things stand now, it seems that, we are simply grooming such big states for
independence. Before Menelik II there were no unified independent Amhara, Tigray or Oromo
states. All we had were semi autonomous Wag, Begemder, Yeju, Gojjam, Showa, Agame,
Axum, Temben, Raya, the five Gibe states, Qeleem, Wallagaa, Borana, Harrar, various gadaa led
states in central and south oromiya etc., not to mention others such as Kaffaa, Hadiyaa, or
Wolayita,.etc… Some of them were even at war with each other despite speaking the same
language, for example, the Muslim and non-Muslim Gibe States. If we want to go back to the
pre-Minilik era, which ones do we consider the original position of the current constituents of the
federation? do we get Amhara, Oromo and Tigray, the so called amalgam of Southern Nations,
Nationalities and Peoples regional state? Of course, all these should not be taken as a license to
reorganize them haphazardly without taking their wishes in to account.
The Constitutional adoption process was not fully consultative
Constitution is a holy scripture of federations, indeed for any country, except that it is made by
humans for humans. A document of such significance has to be carefully deliberated upon and
has to get a near unanimous support of its inhabitants and needs to adapt to changed
circumstances. Unfortunately, the FDRE Constitution of 1994 was adopted in haste without
getting the backing of the cross-section of the population and political groups.
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As a result, it is largely viewed as a political program of the EPRDF and a handful of other
armed groups repackaged as a constitution. Most of the political rancor of the past two decades
could have been avoided if the Constitution was adopted with the full backing of the Ethiopian
people and its sidelined political groups. It is hardly possible to expect such document to
command the obedience of those who were sidelined when the Constitution was adopted.
EPRDF has not done any fence mending job since its adoption to overcome this fatal blow to the
legitimacy of the constitution. It is intransigent as ever and too quick to charge those who
challenge the constitution with treason, and yet continues to flagrantly violate the terms of its
own constitution with impunity. It does not help to venerate the constitution when it serves the
interests of the EPRDF only. This helps to multiply the number of people who hold the
constitution in contempt.
The toxicity of ethnicity as an organizing principle
This is a radical departure from the past and it is the most daring political experiment attempted
anywhere in the world in recent decades. Not only does the constitution recognize (group)
identity rights of various ethnicities, which is the right thing to do, but it moves in to the
uncharted territory by putting them at the pinnacle of government power in their respective
regions and at the federal level. In the constitutional speak, the Nations, Nationalities and People
are the Sovereign. The problem is when ethnicity becomes a raison d‘être for everything.
Glorifying ethnicity is toxic and a very volatile matter which could be exploited by agitators and
need not have such an overriding place in cosmopolitan societies. When Ethiopia sheds its
agrarian character for a cosmopolitan one, with strong economic activity in all its corners,
ethnicity can only serve as an unnecessary distraction. Also in difficult economic times, ethnicity
will readily serve as an escape route. One should get a lesson from an overwhelming defeat
which EPRDF was handed during the 2005 election in the cities and the opposition to its current
kind of federalism in such places. These parties ran on the platform of repealing certain
provisions of the current constitution. Cities are nothing but indications of what the country
would look like in the future.
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One proposal often made to diffuse this situation is to break up the existing regional states
geographically and organize them in a manner which reflects settlement pattern, existence of one
economic community etc...The credibility of such proposals is, however, put in to question due
to the fact that its protagonists are figures nostalgic of unitary Ethiopia, which had a history of
marginalization of most of its ethnic communities. Furthermore, there has not been any clear
articulation of whether regional states so broken down will or will not continue to enjoy the right
to choose their working language based on a free and fair vote of their inhabitants. For this
debate to progress and mature, protagonists of unitarism must swallow a bitter pill, accept the
fact that the genie is out of the bottle and return to the table with a view to reforming the existing
federal arrangement. As is being witnessed, EPRDF is using the uncompromising attitude of
unitarists as an example of how those with alternative views are apologists of the bygone era and
do not have the best interests of ethnic communities at heart.
The elephant in the house: people with mixed ancestry
Now that we have ethnicity as an overriding concept, the constitution, however, utterly failed to
take notice of one large group of Ethiopians. These are people with mixed ancestry, those who
are thorn between their various identities and simply prefer to identify themselves as Ethiopians.
There are many other, who for various reasons, want to be first recognized as Ethiopians
suppressing their ethnic identity. We do not even have a statistics on the number of people who
prefer to simply identify themselves as Ethiopians or simply feel unease about speaking about
their ethnic identity.
It is, of course, unwise and impractical to carve up a separate identity akin to ethnicity for such
group of people so as to fit them in to the constitution as was the case in Apartheid South Africa
in regards to the colored people with mixed white and black ancestry. The Constitution, even in
its own terms, had failed to address the interests of such category of people. People with such
background rightly feel anxious and excluded from the new mantra of the sovereign nation,
nationalities and peoples.
Where does ethnicity stop?
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The trouble in Somalia is sufficient to convince anyone that playing with ethnicity is like
opening Pandora‘s Box. Clan, sub-clan, district, religious and denomination divisions will be the
next issues that will occupy the space vacated by ethnicity.
Ethnicity may appear tantalizing for marginalized ethnic groups in the short run, but the new
frame of thinking will most likely activate or exaggerate other existing differences between
people belonging to the same ethnic group. We are definitely better off focusing on the big
picture than what makes us different. It is not without reason that the most tolerant people in the
world are found in countries that are so diverse. The strength of the United States of America lies
in its diversity although it had come a long way recognizing and respecting its different
identities.
It is all about opportunities and being left out, isn‟t it?
It is an alarming experience when a citizen of a country feels or perceives that he is unwelcome

to another part of the country or cannot partake in the economic and political affairs of that part
of the country where he was born and bred; or even when he feels entitled to be anywhere by
virtue of being a citizen but cannot. The Constitution does not exclude them literally but created
a suitable condition for an exclusion to take place. One can readily blame the affected person for
not putting an effort in to learning the language of the region but that cannot be a satisfactory
answer in Ethiopian context.
Over the past two decades, the standing of the Amharic language, the lingua franca, is
deteriorating and a decade or so down the line, if not already, there will be a new generation of
Ethiopians who will not be able to communicate with each other due to the neglect of not only
Amharic, but also due to failure to elevate other major languages such as Oromiffa as the Federal
government‘s working language and as an optional second language in other regional states.
Opportunities to learn languages of their choice should be provided for those who feel alienated
because of language policies. Both the Federal and Regional Governments must make it their
responsibility to protect ethnic minorities within their boundaries and provide them with a safe
and fulfilling environment for them and their families. But we have so far failed to democratize
the country, reign in a privilege accorded
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to natives to the exclusion of the ‗outsiders‘, and calm the nerves of vulnerable minorities in the
regional states.
The federal geographical division is not principle
The Constitution also failed to exercise even-handedness in its elevation of some ethnic groups
in to regional statehood by leaving equally (if not more) entitled ethnic groups in the cold.
Number clearly was not a factor since we have one of the smallest, Harari as a state, not the
Woliyta or Sidama who are much larger in number and size. Nor historical vulnerability a factor,
for we see the people of Agew swallowed up by the Amhara and Tigray regional States. They
have equal moral claim to statehood as that of the Harari. It is even difficult to understand the
principle behind lumping about 45 ethnic groups in to one regional state in the South. They have
every reason to be aggrieved by this lack of even-handedness.
The right to secede
Another issue is the right to secede by the regional states contained in Art 39 of the Constitution.
This is a rather unusual and corrupted right plucked out of context from Stalinist thought and put
in to the Ethiopian Constitution. If Stalin was alive he would have scoffed at the intellectual
fathers of the Ethiopian constitution for their subversion or perhaps misunderstanding of his
writings. It is out of context because Stalin and Lenin conceived the issue of national question
and secession in the context of colonial and capitalist domination. It was designed as a tool to
overthrow the bourgeois and the right to secede is subordinate to the cause of proletariat
revolution. These conditions are clearly absent in the Ethiopian context. It is in fact baffling that
this had to come following the overthrow of an openly Marxist-Leninist regime of Mengistu
Hailemariam by stealth Stalinists. Stalin believed that a ‗nation‘ which is a definite community
of people ―is not racial, nor is it tribal,‖ but a ―historically constituted community of people.‖
Thus, according to Stalin, ―a nation is a historically constituted, stable community of people,
formed on the basis of a common language, territory, economic life, and psychological make-up
manifested in a common culture.‖
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If one strictly applies Stalin‘s Nation theory, one would be hard-pressed to find an Ethiopian
ethnic group that fulfills all the requirements, such as, the existence of ―an economic life or
economic cohesion‖ between them at the time of the adoption of the constitution or even before
Minilik. Was there an economic cohesion between Begemidir and Showa or between Borena and
Jimma? or even between Raya and Adowa, except that they spoke the same language? Even
among the fairly small group such as the Tigreans, isn‘t the pan-Tigrean consciousness a creation
of the elites than the ordinary folks? There is the more pronounced Axum, Adowa, Agame,
Temben identity before that of a Tigrean. This has nothing to do with respecting the identity
rights of any group regardless of whether such group belongs to one nation instead of the other,
because it is possible for people speaking the same language to belong to different nations or
countries, unless we are engaging in an artificial nation building. But is it worth the effort to
engage in such grandiose national engineering by amplifying what makes groups different from
each other instead of focusing on their common interest and aspirations?
The constitution does not even define who Nations, Nationalities and Peoples are, so it seems out
of an attempt to escape from questions that arise as to the appropriateness of such definitions and
their applications to particular ethnic groups. It instead chose a catch-all-definition of what these
three terms mean collectively (art. 39(5)).
Considering the previous argument about commitment to the project of a modern federal
Ethiopia, what purpose does it serve to include such a wedge issue provision in the Constitution?
Unfortunately, one has to again look at the ulterior motives of the intellectual fathers of the
constitution instead of a long term purpose it was intended to serve. Personally, I fail to accept
the argument that it was included to guarantee freedom and solidify voluntary union. Therefore,
unless it is intended for use by the TPLF to allow its Tigray province to secede as it professed to
do so in its Greater Tigray Manifesto of 1976, I do not see any long term significance. If Tigray
goes, it is unlikely that Ethiopia would be able to stop secession by any of the remaining regional
states. On the other hand, if TPLF leaders have a change of heart and see their future with the
rest of Ethiopia, it is equally unlikely that they will allow others to secede as long as the power
balance remains in TPLF‘s favor.
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Until then, Ethiopians will unnecessarily continue fighting in favor of or against a constitutional
right to secede, a provision which is superfluous and should not have been included in the first
place.
Contrary to the claims of the TPLF/EPRDF, this right will do nothing to advance Federalism. It
is anathema to the very idea of Federalism, an arrangement which was introduced in the first
place to create conditions of mutual trust and voluntary union. The choice of federalism is a
compromise already. One can only see the purpose of such arrangement as one intended to
groom members of the federation for eventual statehood. Unlike the coming together of
independent states, for example in the United States, the members of the Federation in Ethiopia
have not come together out of their complete free will. Contrary to what the constitution says,
there is too much appeal in becoming independent, especially for those regional states which are
large, resource rich and can become a viable state without any difficulty.
It is amusing how Stalin aptly observed in 1913 on how cultural autonomy superimposed on
federalism could lead to separatism. He wrote: ―One may or may not dispute the existence of a
logical connection between organizational federalism and cultural-national autonomy. But one
cannot dispute the fact that the latter creates an atmosphere favouring unlimited federalism,
developing into complete rupture, into separatism.‖ This according to him is inevitably because
of the ―nationalist atmosphere which is naturally generated by cultural-national autonomy.‖ It
seems that our leaders introduced this daring experiment without understanding him. Who would
have thought that one can find such an apt observation in Stalin‘s own work?
Lack of unifying federal institutions and civil societies
Granted that we want to consolidate the kind of federalism we have and in concurrence to the
requisite reform recommended, there is a need for considering certain elements lacking in the
constitutional architecture. The underlying theme to the opposition of the current federal
arrangement is the decimation of the hitherto strong unifying sentiment prevalent in state
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institutions and structures. The constitutional design has not helped in countering that. Let us
look at some of these.
A) The presidency- Ethiopia has for the first time adopted a prime minster led executive
government and parliamentarian system. This is a rarity in Africa, which is accustomed to a
directly elected (rigged election or otherwise) strong President as the head of state. The head of
state in Ethiopia is the President, but it is one of the most powerless ceremonial presidencies
anywhere in the world. He is elected by the Parliament just like the Prime Minister and does not
have any meaningful power to speak of. Thus, neither the President nor the Prime Minister
(naturally) comes to office through a nation-wide election by the electorate. They are not
unifying figures as a matter of institutional design. In some parliamentarian and federal systems
like Canada and Australia, there is at least the institution of the monarchy that plays a unifying
role because of their historical tradition. In India, the President enjoys considerable power
compared to his Ethiopian counterpart. It is hard to figure out why such design, as opposed to the
most common models, was chosen except that it was perhaps tailor made to cater to the short
term power-jockeying needs of the senior partner of the governing coalition. Presidency
normally has term limits, but not that of the premiership. It is easy and in accordance with an
international standard for a prime minister to run the government as long as ‗the ruling party‘ in
parliament elects him.
That serves the TPLF very well.
B) Unifying language- the existence of a unifying language is important for fostering unity,
nation building and for facilitating economic activities as discussed above.
C) Lack of strong nationwide trade unions, professional organizations and civil societies
It is no surprise that nationwide civil societies, trade unions and professional organizations are
practically non-existent in today‘s Ethiopia thereby arresting the advancement of the rights of
their members and that of the community in general. It takes a long time for regional
independent civil societies to emerge. They also operate under very difficult environment
compared to their federal counterparts; and even if they have a space to operate, they tend to look
at issues from the narrow perspective of their regional interest. In
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the process the whole suffers. It is a classic divide and rule system in operation under the guise
of federalism. The Federal Government, which is given too many powers under the constitution,
can do anything it pleases without suffering the consequences. The war waged against the former
Federation of Ethiopian Labour Union and that of Teachers Association is an important example.
In the past two decades it has been rare to find workers or professionals coming from different
regional states to rally in solidarity for a common cause. Splitting of trade unions according to
nationality or ethnicity as was recognized by Stalin was a cause for aggravated national friction,
disorganization and demoralization. Such is the state of our trade unions, professional
organization and civil societies. As you can see already, one can simply quote from the
communists‘ great playbook, which the young communists must have read from pages to pages,
to show how wrong they got it.
Lack of impartial arbiter of constitutional disputes
Ethiopia also made an unusual decision of not installing its judicial branch as the arbiter of its
constitutional disputes. Instead it has the House of Federation (HOF)- an unequal conjoined twin
to the House of Peoples Representatives, as the penultimate interpreter of constitutional disputes.
This is an ideologically driven, communist to be exact, choice which rests on the assumption that
the constitution is a pact between ‗nations‘, ‗nationalities‘ and ‗peoples‘ of Ethiopia and it is the
representatives of these entities and not the judiciary which should interpret it. This assumption
forms the backbone of the apathy of the regime towards the judicial branch.
The HOF is supposed to be the upper house of parliament composed of representatives of nations
and nationalities who may be elected or appointed by regional states. HOF is not involved in law
making thereby distinguishing it from the likes of the United States Senate. Each ethnic group
will have one representative in the HOF with one more for each 1 million additional population.
It is not created to look after States rights per se, and the bigger the ethnic group is, the more
representatives it will have in the HOF. This does not inspire the feeling of equality among
member states of the Federation. Just as in the House of Peoples
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Representatives (the parliament) major ethnic groups can make decisions to the detriment of the
smaller regional states. There is no check on their power, considering that it is this body that sets
budget subsidy formula for budgetary allocation by the federal government to the regional states.
Even if the HOF is the best body to look after ethnic interests, it cannot be an impartial guardian
of individual human rights. At the end of the day ethnic groups are composed of individuals.
There are also instances where ethnic rights may conflict with individual rights and the HOF
should be excluded from being a judge in its own cause as a matter of elementary principle of
natural justice. The only role an institution of this kind should be allowed to have is only to
mediate and seek resolution to inter-state disputes.
Nations, Nationalities and Peoples are happy. What about individuals?
EPRDF paints a picture of a very happy and grateful ‗nations‘, ‗nationalities‘ and ‗peoples‘ it
liberated. In a manner reminiscent of happy creatures in Jehovah Witnesses publications and
propaganda leaflets from North Korea, EPRDF propagandists effusively tell us daily of the
strides achieved in protecting ethnic rights as if they are some mythical entities not composed of
individuals. Yet, an unhappy individual whose rights are trampled upon on daily basis is excused
for believing that federalism has not made his destiny any better. Are individuals expected to
surrender thier other basic human rights simply because they are now guaranteed to use thier
God given right to use thier own language? These need not be mutually exclusive. EPRDF can
salvage its federalism by assiduously working towards respecting and protecting individual
human rights.
CONCLUSION
Post-EPRDF Ethiopia
As pointed out at the beginning of this note, the strength of any good system of government is to
be judged with its continued existence after its ‗founding fathers‘ are long gone. We live in a real
world and we cannot undo what happened. But we can change the future if we can learn from
our past and change the way we do things. Imagine for a second an Ethiopia without EPRDF-a
deeply Marxist party in a liberal cloak which runs the affairs of the Federal government and the
regional States with a tight control. What do you see coming?
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Governance and Development Studies
To be optimistic, and even before we get there, to EPRDF‘s credit, without EPRDF‘s
hands-on approach on the implementation of Federalism, Ethiopia would have already
fragmented in to several independent states following the proclamation of the FDRE
Constitution. We can simply say that the problem itself is EPRDFs own making but
that is now in the past. The fragmentation did not happen because of EPRDF‘s tight
control over the regional states, but we cannot get complacent. It is true that there is a
common bond between peoples and there is no deep rooted animosity that might push
some to exit the Federation abruptly. But history is littered with several examples of
masses being taken for a ride by few of its misguided children. All it takes is for a few
dissenters to take up arms and for a stupid government to start harassing the
population for harboring the rebels.
The unexpected might happen and the EPRDF might lose power one way or another.
Nothing lasts forever. Under this scenario there is no guarantee that the Federation
will continue as we have not done our homework of building unifying institutions,
protecting individual rights and making federalism appealing to regions which are
either resource rich or large in size. There is no incentive for them to stay in the
federation willingly. On top of it all, the Constitution has made it extremely easy for
any regional state to secede. The silver-lining to all of this, however, is that we all
want Ethiopia to prevail in the face of adversities. Our fates are so intertwined that we
cannot stand by and watch when one of us starts to get adrift.
Introduction to Politics and Government Page 361

COURSE 7: INTRODUCTION TO POLITICS AND

GOVERNMENT
UNIT ONE
Definition of Basic Concepts
Section one: Politics and Political Science
1.1. Politics. It is the activity of peaceful resolution of conflicts, tensions. It is

settlement of public conflicts with social, economic, and political nature through
compromise, negotiation, give and take, conciliation, manipulation, peaceful means of
reasoning such as using different forums like free press, freedom of speech,
parliamentary debates, persuasion, diplomacy, etc. It is a human normal civility
process. Politics is also the resolution to determine ―who gets what, when, and how.‖
It is a technique of compromise. But at the later stage conflicts will be resolved by
violent means of force and coercion like bloody demonstrations, Punishment/penalty,
warfare, civil war, manipulation, etc. Conflicts are the driving force of politics. These
conflicts can be dealt with a political manner through negotiation, bargaining, and
compromise.
Generally, politics is a process involving governmental attention to relevant opinions,
suggestions, debates…and their conciliation (win-win or win-lose) through temporary
law (law as a solution to a public conflict).
So far, we have avoided giving a specific definition of politics. A definition is simply

a proposed agreement governing the use of items. There are many definitions of
politics. From our discussion above, one way of defining politics is to state that it
involves, to a significant extent, the use of power, rule and authority in any human
relationship. The word Politics originated in Greek when the Greek introduced the
ideas in their so called city states.
The word was derived from the Greek word polis and was first used by Aristotle to
refer to the general affairs operating in the Greek city states at the time.
The sources and causes of conflicts could be different depending on the culture,
development, educational level, history, etc of the specific community. Conflicts may
be constructive or destructive depending on our ability to transform them to the
benefits of the country.Power, resources, regional and social differences, difference in
ideologies, etc could be sources of conflicts.

1.2. Political science: Political Science, the systematic study of and reflection upon
politics. Politics usually describes the processes by which people and institutions
exercise and resist power. Political processes are used to formulate policies, influence
individuals and institutions, and organize societies.
Many political scientists study how governments use politics. But political scientists
also study politics in other contexts, such as how politics affects the economy, how
ordinary people think and act in relation to politics, and how politics influences
organizations outside of government.
The emphasis upon government and power distinguishes political science from other
social sciences, although political scientists share an interest with economists in
studying relations between the government and economy, and with sociologists in
considering relations between social structures in general and political structures in
particular. Political scientists attempt to explain and understand recurrent patterns in
politics rather than specific political events. It is the study of struggles, competition
and conflicts for government power. In particular, it focuses on two interrelated
questions;
a) Why and how do leaders make the decisions they do?
b) Why do citizens obey most of these decisions but sometimes disobey others?
Generally, political science deals with power relations, authority and legitimacy and
analyzes the activities of government and focus on governance. In short, political
science begins and ends with the state (origin, nature, forms of political institutions).
1.3. Fields of political Science
Political science is organized into several fields, each representing a major subject
area of teaching and research in colleges and universities. These fields include
comparative politics, American politics, international relations, political theory, public
administration, public policy, and political behavior.
A- COMPARATIVE POLITICS: Comparative politics involves study of the

politics of different countries. Some political scientists, known as area
specialists, study a single country or a culturally similar group of nations, such
as the countries of Southeast Asia. Area specialists tend to be versed in the
language, history, and culture of the country or group of countries they study.
Other political scientists compare culturally dissimilar nations, and investigate the
similarities and differences in the politics of these nations. Political scientists who
undertake these comparisons are often motivated by the need to develop and test
theories—for example, theories of why revolutions happen. This may lead them to
discover commonalities between countries that are widely separated and appear very
different. For example, political scientists have found many similarities between the
transitions from authoritarian rule to democracy in Latin America and Eastern Europe
in the 1980s and 1990s.

B. INTERNATIONAL RELATION: International relations are the study of the

international system, which involves interactions between nations, international
organizations, and multinational corporations. The two traditional approaches used by
political scientists in the study of international relations are realism and liberalism
(which is not the same as liberalism as a political ideology).
Realism emphasizes the danger of the international system, where war is always a
possibility and the only source of order is the balance of power. Liberalism is more
idealistic and hopeful, emphasizing the problem-solving abilities of international
institutions such as the United Nations and World Trade Organization. In 1991, after
the Soviet Union dissolved and the Cold War ended, the balance of opinion briefly
shifted in favor of liberalism, but realists were quick to point to the potential for future
international conflicts.
Beginning in the 1980s constructivist political scientists asserted that the interests of
nations and the character of their interactions are not fixed, but can be determined by
policy makers. For example, for the past 50 years, U.S. policy makers have
constructed the identity of Canada and Cuba in quite different ways. In spite of the
fact that Canada and the United States were rivals in the early part of their history,
during the 20th century the U.S. has established military and economic alliances with
Canada and regards it as a close ally.
In contrast, since Cuba‘s 1959 revolution and subsequent adoption of Communist

principles, the United States has treated Cuba as a potential threat to American
national security. Many European nations and allies of the United States believe this
fear is unwarranted. According to constructivist political scientists, the identities that
U.S. policy makers have constructed for countries like Canada and Cuba help to
determine whether the fears of realists or the hopes of liberals are more likely to be
realized.
C. POLITICAL THEORY: Political theory involves the study of philosophical

thought about politics from ancient Greece to the present; the interpretation and
development of concepts such as freedom, democracy, human rights, justice, and
power; the development of models for government, such as participatory democracy
or constitutional systems; and the logic that political scientists use in their inquiries.
Political theory overlaps law, philosophy, and the other fields of political science.
In 1971 John Rawls, a professor of philosophy at Harvard University in Cambridge,

Massachusetts, published A Theory of Justice, which revitalized political theory.
Rawls‘s book showed that it was still possible to generate sophisticated and
challenging philosophical arguments about the way that political systems should be
organized, and that political scientists should not just look to the ideas of the great
philosophers of the past.

D.PUBLIC ADMINISTRATION: Political scientists interested in public

administration study government organizations and their relation to other parts of
government. Political scientists investigate how these organizations work, and try to
devise methods of improving them. For example, David Osborne and Ted Gaebler‘s
book Reinventing Government (1992) inspired many national, state, and local
governments to adopt more-competitive and less bureaucratic ways of delivering
services to the public.
E. PUBLIC POLICY: The field of public policy involves the study of specific policy
problems and governmental responses to them. Political scientists involved in the
study of public policy attempt to devise solutions for problems of public concern.
They study issues such as health care, pollution, and the economy. Public policy
overlaps comparative politics in the study of comparative public policy; with
international relations in the study of foreign policy and national security policy; and
with political theory in considering ethics in policy making.
F. POLITICAL BEHAVIOR: Political behavior involves the study of how people

involve themselves in political processes and respond to political activity. The field
emphasizes the study of voting behavior, which can be affected by social pressures;
the effects of individual psychology, such as emotional attachments to parties or
leaders; and the rational self-interests of voters. The results of these studies are
applied during the planning of political campaigns, and influence the design of
advertisements and party platforms.
Section Two: State and government
Overview of the Section
Section Three: State and government

2.1. State
2.2. Nation-state
2.3 Government
2.4. Governance
2.1 State
A state is a political association with effective sovereignty over a geographic area and
representing a population. These may be nation states, sub-national states or
multinational states. A state usually includes the set of institutions that claim the
authority to make the rules that govern the exercise of coercive violence for the
people of the society in that territory, though its status as a state often depends in part
on being recognized by a number of other states as having internal and external
sovereignty over it. In sociology, the state is normally identified with these
institutions: in Max Weber's influential definition, it is that organization that

"(successfully) claims a monopoly on the legitimate use of physical force within a

given territory," which may include the armed forces, civil service or state
bureaucracy, courts, and police. Recently much debate has surrounded the issue of
State-building with competing schools of thought on how to support the emergence of
capable states.
Although the term often includes broadly all institutions of government or rule—
ancient and modern—the modern state system bears a number of characteristics that
were first consolidated beginning in earnest in the 15th century, when the term "state"
also acquired its current meaning. Thus the word is often used in a strict sense to refer
only to modern political systems.
Within a federal system, state also refers to political units, not completely sovereign
themselves; however, these systems are subject to the authority of a constitution
defining a federal union which is partially or co-sovereign with them.
In casual usage, the terms "country," "nation," and "state" are often used as if they
were synonymous; but in a more strict usage they can be distinguished:
 Country denotes a geographical area.

 Nation denotes a people who are believed to or deemed to share common
customs, origins, and history. However, the adjectives national and
international also refer to matters pertaining to what are strictly states, as in
national capital, international law.
 State refers to the set of governing and supportive institutions that have
sovereignty over a definite territory and population.
The word state and its cognates in other European languages (stato in Italian, état in
French, Staat in German and Estado in Spanish and Portuguese) ultimately derive
from the Latin STATVS, literally "standing" but meaning "condition" or "status".
With the revival of the Roman law in the 14th century in Europe, this Latin term was
used to refer to the legal standing of persons (such as the various "estates of the
realm" - noble, common, and clerical), and in particular the special status of the king.
The word was also associated with Roman ideas (dating back to Cicero) about the
"status rei publicae", the "condition of the republic." In time, the word lost its
reference to particular social groups and became associated with the legal order of the
entire society and the apparatus of its enforcement.
2.2 The nation-state (or by its common name a country) is a certain form of state
that derives its legitimacy from serving as a sovereign entity for a nation as a
sovereign territorial unit. The state is a political and geopolitical entity; the nation is a
cultural and/or ethnic entity. The term "nation-state" implies that the two
geographically coincide, and this distinguishes the nation state from the other types of
state, which historically preceded it. If successfully implemented, this implies that the

citizens share a common language, culture, and values — which was not the case in
many historical states. A world of nation-states also implements the claim to self-
determination and autonomy for every nation, a central theme of the ideology of
nationalism.
Due to ambiguities in the word 'state' especially as in "United States of America", the
term "nation-state" is now frequently misused to mean any sovereign state, whether or
not its political boundaries coincide with ethnic and cultural ones. The usage appears
to arise from an attempt to distinguish a sovereign "nation-state" from a federal
"state"- that is a subordinate member of a federal system- such as a state of the USA.
2.3 Government: is machinery that executes the wishes of the state. A state must
have some organizing force over its population. The absence of such organization is
anarchy. Government is an administrative wing of a state. Governments come and go
as politicians and civil servants change in office. Harold J. Laski says that ―Every
state, in short, is a territorial society divided into government and subjects, the
government being a body of persons within the territorial society, who are entitled to
use coercion to see that these imperatives are beyond.‖ The government is the
machinery by which the state maintains itself, pursue and excuse its objectives.
It cannot be said to be conterminous to the state which is an embodiment of the entire

people as an aggregate. Rather, it is a small group of men that directs the affairs of
the state. The state as an entity is much more enduring than the government which
could at anything changes, either by a peaceful democratic process or through a
revolution. Although it is possible for as state to be conquered and annexed, it is not a
common occurrence for a change of government. Ethiopia has lived for centuries un-
colonized; While Liberia has been an American protectorate, a democracy, and a
dictatorship (military government).
It is an institution whose purpose is to solve human disputes through law and enforce
these solutions or laws through superior power. Government is a regulatory of
society. It sets down the basic ground rules that everyone must abide by. In part, a
government is able to enforce its rules (laws) because it controls the supreme penalty
of dearth and has a monopoly on the legal use of force.
Dear student in third chapter of this module, you will have more detail lesson about
government and its function.
2.4 Governance
Hyden (1992: 17) defines governance as the ―conscious management of regime
Structures with a view to enhancing the legitimacy of the public realm.‖ According to
the UNDP‘s definition, governance is ―the exercise of economic, political, and
administrative authority to manage a country‘s affairs at all levels‖ (UNDP, 1997:2-
3).

In this perspective, governance comprises the mechanisms, processes, and institutions

through which citizens and groups articulate their interests , exercise their rights, meet
their obligations ,and mediate their conflicts.
Governance is said to have three legs: economic, political, and administrative.
1) Economic governance includes decision-making processes that affect a
country‘s economic activities and its relationship with other economies.
2) Political governance involves the formulation of policy,
3) Administrative governance is the system of policy implementation
As can be seen from this and similar definitions used by international development
agencies, governance is an all encompassing concept. It permeates all sectors and
makes no distinction between governance, policy making, and policy implementation.
Section Three: Power and its related concepts
Overview of the Section
Section Three: power and its related concepts

3.1. Political Power
3.2. Authority
3.3. Sovereignty
3.4. Legitimacy
3.1. Political power: power is one of the ambiguous terms to define. It is the capacity
to cause a thing to happen, that would not happen without that capacity. To put it in
other way, power is the ability to make people do something they rally doesn‘t want
to do (like obeying laws (stopping at stop signs, paying taxes, etc).power is the
influence of others toward the accomplishment of goals. power is a prime ingredient
of politics. The essence of politics is a struggle for power. But, obsession in power is
self-destructive. As the 19thc.British historian and philosopher Lord Acton put it,‖
Power tends to corrupt; absolute power corrupts absolutely‖.
The word power derived from the French verb pouvoir, ―to be able.‖ Power can be
the physical ability to perform a task such as lifting or running, the intellectual
capacity to solve a problem, or the social ability to induce others to do what one
wants.
In political science, power has this latter meaning. Power is to politics what money is
to economics: the medium of exchange, the universal common denominator.
Power comes with authority. Power is the ability to influence people toward
organizational objectives. However, you have limits on your authority and power.
View your authority and power as funnel, broad at the top and narrow at the bottom.
Always assume you have enough authority and power to meet your obligations but do
not exceed that limit.
Power as legal authority

When the term power is used with reference to governmental institutions, it usually
means the legal authority of the state. This type of authority refers to the state‘s
capacity to make law, implement and enforce the law. In other words, it means the
legal competence or jurisdiction of the government as a whole or of the particular
governmental office or institution.
Power as personal authority
Personal authority essentially means leadership ability. It is the capacity to effect out
comes by getting others to acknowledge and follow one‘s leadership. It is the ability
to inspire trust and confidence in one‘s leadership or to command the respect of those
one wishes to lead.
Political power is the capacity to effect out comes by controlling or influencing the
state. It means the ability to determine or influence the decisions, actions or behavior
of government officials.
Forms of power Political power, however, is not a simple thing. There are three main
forms of it: influence, coercion, and authority.
INFLUENCE: is the ability to persuade some to do the will of another, to convince
others to desire the same objective. The important point is that the targets of
persuasion act voluntarily, they are not conscious of restraints upon their will because
they have freely chosen to agree. Of course, they may agree either because they have
come to think that the action is right and justified in itself or because they think they
will reap personal benefit from it. Influence takes many forms from it.
- Appeals to the intellect, i.e., convincing people that a given action is
intrinsically best.
- Appeal to the passions, i.e. persuading people to act by playing directly upon
the emotions.
- Appeal to self-interest, i.e., persuading people to support a cause because of
―what is in it for us.‖
- Appeal to group solidarity, i.e. persuading people to work on behalf of a
community to which they belong.
Because there are so many ways to influence others, there are also many resources
that can be deployed in the task.
Activity: 1. Explain and discuss the six types of power in an organization.
3.2 Authority
Authority: is the right to use public power deemed to be legitimate. It is the ability of
a given leader to win obedience. It is a form of power in which people obey not
because they have been rationally or emotionally persuaded or because they fear the
consequences of discipline, but simply because they respect the source of the
command. Example, the relationship between parents (have right to command) and
children (have an obligation) is a model of authority.
- Legitimacy is respect for a government.
- Sovereignty is respect for a country.
- Authority is respect for an individual leader.

Authority, (unlike influence, manipulation, persuasion, and force), relies on the
obligation of the people to obey their leader by virtue of the legitimate power of his or
her office. Example: - a private soldier obeys a captain, a motorist obeys a state
trooper a student obeys a professor.
But not all the people obey authority mentioned in the above example. Some are in
obedience. Like legitimacy, authority involves a psychological connection among
people. Just occupying an office may not be sufficient to command authority. The
authority figure must also cultivate respect. Effective authority requires firm, air and
wise leadership.
Authority is a form of power in which people obey commands not because they have
been rationally or emotional persuade or because they fear the consequences of
disobedience, but simply because they respect the source of the command. The one
who issues the command is accepted as having a right to do so, and those who receive
the command accept that they have an obligation to obey. The relationship between
parents and young children is a model of authority. Some times the parents will
persuade the child to do something, and occasionally they may have to resort to
coercion, but most of the time they can command with the expectation of being
obeyed.
All governments posses at least some authority and strive to have as much as possible,
for obvious reason. Something more than influence is necessary to guarantee
predictable results. Coercion produces compliance, but it is also very expensive and
furthermore is possible only if a substantial number of agents of coercion are held
together by authority. Clearly, authority is an inescapable necessity of government.
It is safe to say that most people of the time are acting in deference to authority when
they do what their government wishes. They stop at red light and file tax returns
because they realize that such action have been commanded.( of course, they may
have other motives as well.) perhaps their consciences bother them if they disobey
authority.
Max Webber‘s typology of authority:

Weber presupposes that the legitimating beliefs that support the exercise of authority
vary. He identified three types of authority:
1. Traditional Authority: Traditional authority rests on the sanctity of tradition
in conventional usage, in which prevailing social order is seen as inviolable or
sacred. This takes the form of respect for the monarchy or chief, respect borne
out of the inheritance of the status of one‘s parents.
2. Charismatic Authority: Because of the belief in the ‗Personal qualities (the
charisma) of the person who commands`, men may obey voluntarily, thereby
granting legitimacy to the action of the person thereof. However, charismatic
or natural leaders are usually born out of resentment for present order.

3. Legal Authority: Legal authority is legitimate by the supremacy of the law. In

other words, the exercise of power is accepted as legitimate because all
subscribe to existing rules, regulations, laws and policies of the land. Laws
subscribed to are seen as constitutional and in line with the political culture of
the people.
Note. Legitimacy, sovereignty and authority are related. Their concept expresses
relationships among human actors, and the distinction that could be made between
these concepts is only in the extent of variance in the form of relationship. In other
words, there is no hard and fast line in trying to differentiate between these concepts,
outside the form which the relationship takes among human actors. They are generic
terms and hence Robert A. Dahl used ―influence-terms‘ to embrace them all,
including related concepts such as control, persuasion, might, force and coercion.
Where you find one, you find the others. Where one erodes, so usually do the others.
A collapse of authority leads to a collapse of legitimacy, which leads to a collapse of
sovereignty. All the three terms can be grouped under the heading political power.
3.3 Sovereignty: autonomous, absolute political and military power embodied in a

ruler or governmental body. The concept of sovereignty originated when Europeans in
the 16th and 17th centuries were looking for a secular basis for the authority of the
emerging nation-states. In international relations, a sovereign state is equal to other
states; it can govern its own territory, declare war, and so on. Contemporary
international law, however, as well as the treaties that bind nations together, have
modified the freewheeling absolute sovereignty conceived of four centuries ago. The
United Nations is the main legal body today that acts as a check on sovereignty.
In terms of the authority a nation exercises over its own citizens, sovereignty stands in
direct opposition to political expression. A prime function of a state is to survive; in
principle, one way to improve chances of survival is to eliminate internal dissension.
Such dissension, however, is the normal result of the policies of governments that
represent diverse political factions and viewpoints. In modern democracies, therefore,
the exercise of sovereignty is restricted to times when survival is at stake, as in
wartime.
Sovereignty concerns with the rights of a given country to exist. Originally,

sovereignty refers to the power of a monarch to rule over the country‘s territory.
Nations are jealous of their sovereignty and governments take care to safeguard it. for
example, they maintain armies to deter foreign invasions, they control their borders
with passports and visas, and they hunt down terrorists, etc. But, today globalization
reduces the absolute sovereignty of states. Countries with weak legitimacy may lose
sovereignty and open to expansionist neighbors.
Presently, popular sovereignty refers that the ultimate power resides on the people at
large. I.e. they are the ultimate power holders.

3.4. Legitimacy;-is one of the most important concepts in political science.

Originally, it meant that the rightful king or queen was on the throne by reason of
―legitimate‖ birth. Since the middle ages, the term legitimacy has broadened to mean
not only the ―legal right to govern‖ but also ―psychological right to govern‖.
Legitimacy nowadays refers to an attitude in people‘s minds that the government‘s

rule is right. It is the popular perception of a justifiable and acceptable use of public
power. That perception can be based on religion (divine power-to believe in God is to
accept the king), wisdom (like the philosopher king of Plato-whose use of power is
legitimized by virtue of their long education and training), ideology (apathetic to the
ideology), blood relationship (by being the family of royal person), force, political
socialization, or a social contract. Generally, without legitimacy, it is very difficult for
a government to govern. When the feeling of legitimacy erodes, people feel less
obliged, for example, to pay taxes and obey the law. Massive civil disobedience can
breakout. Once the regimes‘ legitimacy had disappeared, no amount of coercion
(force) could get people to obey.
Legitimacy rests on consent (the consent of the governed).One way to determine the
legitimacy of a given government is to see how many police are employed by the state
(relatively few no. of police indicates the presence of high legitimacy, while the
presence of many police force indicates low legitimacy of the government).
The word legitimacy is often interpreted in a normative or a positive way. In a
normative sense, legitimacy gets greater attention as a part of moral philosophy.
According to the German political philosopher Dolf Sternberger, "Legitimacy is the
foundation of such governmental power as is exercised both with a consciousness on
the government's part that it has a right to govern and with some recognition by the
governed of that right." The American political sociologist Seymour Martin Lipset
argues, it also "involves the capacity of a political system to engender and maintain
the belief that existing political institutions are the most appropriate and proper ones
for the society."
Something becomes legitimate when one approves of it. In a positive sense,

legitimacy gets greater attention in political science. For example, an institution is
perceived as legitimate, if approval for that institution is general among those people
subject to its authority. According to John Locke, the British social contractual, issues
of legitimacy are linked to those of consent, both explicit and tacit. "The argument of
the [Second] Treatise is that the government is not legitimate unless it is carried on
with the consent of the governed."
Legitimacy in political science is the popular acceptance of a governing regime or

law as an authority. Whereas authority refers to a specific position in an established
government, the term legitimacy is used when describing a system of government
itself—where government may be generalized to mean the wider "sphere of
influence." It is considered a basic condition for rule: without at least a minimal

amount of which, a government will lead to frequent deadlocks or collapse in the long
run.
The American political theorist Robert A. Dahl has explained the concept of
legitimacy by using the metaphor of a reservoir. For example, as long as the reservoir
stays at a certain level stability can be maintained; if it falls below the required level it
is endangered. Regimes in most states require the assent of a large proportion of the
population in order to retain power. In several countries this is not the case: many
unpopular regimes have survived because they are supported and considered as
legitimate by small but influential elite.
In the case of laws, legitimacy should be distinguished from legality. Action can be
legal without being legitimate (as in the case of an immoral law). Action can also be
legitimate without being legal. When sources of legitimacy clash with one another,
constitutional crisis erupts. Legitimacy as a concept is often applied to other, non-
political, kinds of authority, and also to issues concerning the legitimacy of entire
political-economic systems (such as capitalism) as discussed in the Marxist tradition.
Types of legitimacy
Numinous legitimacy
The dominion of a god king of which ancient Egypt offers the best example, is the
theological doctrine according to which every Pharaoh is himself (among other
things) the god Horus, son of Osiris. The doctrine seems to go back to the very origin
of the empire.
The Roman Catholic priesthood derived its legitimacy and still does from a source
very similar to that of the kingship; according to official doctrine the Papal office is
based on Christ's designation of St. Peter, which continues to sanctify and legitimize
the rule of every successive pope.
Civil legitimacy
Civil legitimacy exists when a system of government is based on agreement between

equally autonomous constituents who have combined to cooperate towards some
common good. Every modern constitutional system or every system of
representational government is founded either on a basic agreement to follow certain
rules or at least on a justifiable assumption that a basic agreement to follow certain
rules exists. Modern constitutional government makes one characteristic of civil
legitimacy particularly clear: Governmental offices are ordered by trust rather than
exercised by dominion. This is expressed in the institution of public elections.
Sources of legitimacy

Weber, like the British philosopher Thomas Hobbes, had an extremely negative and
pessimistic view of human nature, and believed that societies often went through
cycles. Weber did not see democracy as being necessary for legitimacy, as a
government could be legitimized through laws and principles not established by a
vote.
Weber also claimed that it is perfectly possible for a modern society to revert back
and become a follower of a brutal form of charismatic leadership, a phenomenon
which later occurred in his home country of Germany under Adolf Hitler and which
was also witnessed in other parts of the world, such as Mussolini's Italy.
The French political scientist Mattei Dogan, offers a more contemporary conception
of this typology of legitimacy. While Weber‘s typology (traditional/charismatic/legal-
rational) was seminal throughout the previous centuries, Dogan argues that it is
insufficient to cover the complex relationships between legitimacy and political
systems. In fact, in Prof. Dogan's view, the first two types (traditional and
charismatic) are today obsolete.
A fairly recent example of charismatic legitimacy was the Ayatollah Khomeini in

Iran. Dogan believes that traditional authority has disappeared completely, with the
exception of two or three regimes in the Middle East (such as Saudi Arabia). The third
type called rational-legal is, in Dogan's view, an amalgamation of many varieties, to
such a degree that they no longer constitute a "type."
Legitimacy and form of government
In communist states legitimacy is acquired through their principle of establishing

economic equality and economic growth within the society. However, modern
communist states either begun with or eventually fell back on totalitarian methods,
and failed to achieve the stated goals of social and economic equality.
Constitutionalism is a modern concept that desires a political order governed by laws

and regulations. It stands for the supremacy of law and not of the individuals; it
imbibes the principles of nationalism, democracy and limited government.
Political legitimacy involves constitutionalism or the belief that an action is legitimate

because it follows regular procedures which are part of the law of the land. This form
of legitimacy is related to democracy as the justification of these constitutional
procedures is agreed to by popular consent. According to Friedrich, constitutionalism
by dividing power provides a system of effective restraints upon governmental action.
It is a body of rules ensuring fair play and rendering the government responsible.
In monarchies, the Ruler gained legitimacy through the popular perception that he
was the rightful ruler of the province. This perception was often enhanced by

propagating the belief that he was divinely ordained to hold his post and this was
advocated through the Divine origin theory.
This form of legitimacy remains today in the form of absolute monarchy where the
monarch still has effective power. for example in Saudi Arabia. Constitutional
monarchy where traditional sources of legitimacy have been combined with
democratic and constitutional sources of legitimacy is prevalent in many European
countries.
Democracy is often perceived as the most popular form of government. The most
common source of legitimacy today is the perception that a government is operating
under democratic principles and is subject to the will of the people. This is because
democracy is based on the will of the people. Governments often claim a popular
mandate to exercise power; however, how this mandate is derived can vary sharply
from regime to regime.
Liberal democratic states claim democratic legitimacy on the grounds that they have
regular free and fair contested elections in which political parties participate without
any fear or pressure. It has been claimed that liberal democratic states can be
remarkably stable because the legitimacy of the state is not tied to an individual ruler
or ruling party.
According to this argument, in a dictatorial state, deposing the ruler can lead to total
collapse in the system of government. However, in most well-functioning liberal
democracies the ruling party is regularly replaced peacefully without any
constitutional change or major upheavals.
A liberal democratic state gains legitimacy also on the following grounds that a rigid
written constitution or well-respected constitutional conventions which are upheld by
the judiciary within the state is in existence. Popular participation of people in large
numbers takes place in democracy.
A strong and independent media which is unbiased and free from the control of the
government exists in democracy. A system of "checks and balances" and control of
one organ of the state by another (as in the United States, for example) is also
common in democracy. There is economic stability with continuity in policies for a
specific period as governments are elected for a fixed tenure.
Communist states often claim democratic legitimacy on the grounds that they have
won a popular revolution and are acting on behalf of the people in accordance with
the scientific rules of Marxism. In 1930s Germany and Italy, Nazism and Fascism
both claimed to represent the will of the people more directly and authentically than
liberal democracy.

The German jurist, Carl Schmitt, discussed the problem of democratic legitimacy in
the late years of the Weimar Republic in his 1932 polemic treatise Legalitaet und
Legitimitaet. 51% of parliamentary votes make for law and legality, Prof. Schmitt
stated somewhat sarcastically, without ever asking why the remaining 49% accept the
majority 51% decision.
1. By governing well: ensuring economic growth and high employment, providing

protection from foreign invasion or domestic disturbance and dispensing equal justice
to all people….
2. The structure of the government can also contribute to its legitimacy. If people
feel they are fairly represented and have a say in the election of their officials, they
are more likely to obey.
3. Manipulation of national symbols: the national flag, historic monuments,
patriotic parades, and speeches are aimed at convincing people that the government is
legitimate and should be obeyed. But, when other elements of legitimacy have fallen
away, symbols may not create legitimacy.
Unit Two
State and Society
Section One: Understanding Society
1.1 Defining Society
For they strongly related, understanding the idea of state must always begin with
explaining the concept of society. Different scholars define society differently but the
central meanings of the concept remain the same. For example, some may say that it
is an autonomous group of people engaging in a wide range of cooperative activities.
A group of people can be termed as a society when its members fulfill the following.
They should live together for a long period of time; they should possess common
values and interests, and, they should share common culture, traditions and life styles.
This may be to mean that society involves different group of people sharing common
values and making interactions with various regards.
A large number of communities that have social, cultural, and economic interactions
constitute a society. Therefore, society is a large group of people who live together in
a common environment and have common traditions, value, institutions, activities,
and interests. In other words, Society is the totality of modes of human life,
interactions, norms of behavior, and underlying structures, of which the most typical
is the state. Thus, state is located within a large system of human society.
A society is a grouping of individual, which is characterized by common interest and

may have distinctive culture and institutions. ―Society‖ may refer to a particular
people, such as the Nuer, to a nation state, such as Switzerland or to a broader

cultural group, such as Western society. Society can also be explained as an organized
group of people associated together for religious benevolent, culture, scientific,
political, patriotic, or other purposes.
1.2 Origin and usage
The English word society emerged in the 15th century ad is derived from the French
societe. The French word in turn, had its origin in the Latin societas , a ‗friendly
association with others,‖ from socius meaning ―compassion, associate, comrade or
business partner.‖ implicit in the meaning of society is that its members share some
mutual concern or interest, a common objective or common characteristics.
In political science, the term is often used to mean the totality of human relationships
generally in contrast to the state. i.e. the apparatuses of rule or government within a
territory.
―I mean by it [the state] that summations of privileges and dominating

positions which are brought into being by extra-economic power… I mean by
society. The totality of concepts of all purely natural relations and institutions
between man and man…‘
In social sciences has been used to mean a group of people that form a semi-
closed social system, in which most interactions are with other individuals
belonging to the group.
According to sociologist Richard Jenkins, the term addresses a number of

important existential issues facing people that form a semi-closed social system, in
which most interaction are with other individuals belonging to the group.
According to sociologist Richard Jenkins, the term addresses a number of

important existential issues facing people:
1. How human think and exchange information- the sensory world makes up only a
fraction of human experience. In order to understand the world, we have to
convince of human interaction in the abstract ( i.e. society)
2. Many phenomena cannot be reduced to individual behavior-to explain

conditions, a view of something ―greater than the sum of its parts‘ is needed.
3. Collectives often endure beyond the lifespan of individual members
4. The human condition has always meant going beyond the evidence of our
senses, every aspect of lives is tied to the collective.
1.3. Evolution of Societies

Gerhard Lenski, a sociologist, differentiates societies based on their level of

technology, communication and economy. These are:
1. Hunters and gathers;
2. Simple agriculture;
3. Advanced agriculture, and
4. Industrial.
This is somewhat similar to the system earlier developed by anthropologist Morton
H. Fried, a conflict theorist, and Elman service, an integration theorist, who have
produced a system of classification for society in all human cultures based on the
evolution of social inequality and the role of the state. This system of classification
contains four categories.
- Hunter-gatherer bands, which are generally egalitarian
- Tribal society in which there are some limited instances of social rank and
prestige.
- Stratified structure led by chieftains
- Civilization with complex social hierarchies and organized, institutional
governments.
Over time, some cultures have progressed towards more –complex forms of
organizations and control. This cultural evolution has a profound effect on patterns
of community. Hunters-gatherer tribes settled around seasonal food stocks to
become agrarian villages. Villages grew to become towns and cities. Cities turned
into city-state and nation-states.
1.4. Characteristics of society
The following three components are common to all definitions of society.

-Social networks;
- Criteria for membership, and
- Characteristic pattern of organization
Social networks are maps of the relationships between people. Structural features
such as proximity, frequency of contact and type of relationship (e.g. relative,
friend, and colleague) define various social networks.
Section Two: Understanding state
2.1 Defining and essential Elements of state
Dear student, what do you think is a state? Define it.

As a concept, state refers to a territorial entity that is politically organized and has a
government and people. The state can be understood as the highest and most powerful
political organization of society. It possesses the monopoly of power to use within its
territory. The state is the final source of all laws within its territory. It is subject to no
other power above itself whatsoever. This implies that the state is sovereign. This is
to say that the state has legitimacy to exercise power internally (internal
sovereignty) in its relations with its people and externally (external sovereignty) in
its relations with other states. The state also determines how this power shall be
organized and exercised in its territory. The agency that is entitled to always exercise
the power on the behalf of the state is called Government.
State, in political science, generally a group of people inhabiting a specific territory

and living according to a common legal and political authority; a body politic or
nation. In this definition, the term state includes government; in another usage, the
two terms are synonymous. Among types of states that developed at various times in
history were the city-states of ancient Greece, in which sovereignty rested with the
free citizens of an independent city. During the middle Ages, Europe was divided
politically into many small principalities, the boundaries and sovereignties of which
changed frequently. From this condition of political anarchy, the modern nation-state,
which consists of a group of people with the same or similar nationality inhabiting a
definite territory, emerged by a gradual process extending over centuries. The type of
government has varied, first taking the form of absolute monarchies and later of
constitutional monarchies or republics, some of them federations or unions of semi-
independent states. In the 20th century totalitarian dictatorships, in which one ruler
assumes absolute power, have been established in some states.
The state is the entire territorial community, organized for collective action through
its government. The state is more abstract and permanent entity. Scholars give
different meanings to the state with common concept. According to Ely Chinoy,‖ As a
concept in social science, the state refers to those institutions that establish who shall
posses the monopoly of the legitimate use of physical force within a given territory,
and that define how the power which rests upon that monopoly shall be organized and
used. The person who exercises this power composes the government.
Professor Laski defines the state as,‘ a territorial society divided into government and
subjects claiming within its allotted physical area. a supremacy over all institutions.‖
He further emphasized that the state,‖ is in fact that final legal depository of social
will. It sets the perspective of all other organizations. It brings within its power all
forms of human activities, the control of which it deems desirable. It is moreover, the
implied logic of this supremacy that whatever remains free of its control does so by its
permission.‖
Supportive of this position is the British authority on the international law, as

expressed by L.Oppenheim who stated that a state ―… is in existence when person is
settled in a country under its own sovereign government.‖ Before continuing with the
explanation on what a state is and its essential elements a brief overview of the origin
and theories of the state is necessary.

From the above explanations, to precisely define what the state is there are essential
attributes that must be fulfilled. These are population, territory, government and
sovereignty. Therefore, simply a state is composed of people living together, a
defined territory having an international recognition, a government which is
responsible for the administration of its people and sovereignty which denotes
independence both internally and externally. In other words, particularly modern state
is defined as a politically organized body of people permanently occupying a definite
territory, living under a national/central government, which is almost, in principle,
free from any external control and internally competent to secure regular obedience
from all people.
Dear student, what does make those elements essential/ could you explain each
separately?
When we say there essential elements of state, it means that there are the
necessary/compulsory attributes determining the existence of the state. That is, a
state cannot survive without its population, territory, government and sovereignty.
They are universally accepted criteria of statehood under international law that the
state should fulfill as an international person. Looking at how they are important
requirements for existence of the state seems sound here.
A) Population: refers to people permanently settling on a definite territory of the

state. As far as the state is the (highest form of) organization of people, population is
the necessary element of the state. It is people constituting what the state is all about,
with out which it is quite difficult to call the state organization of what it is. However,
as far as the number of people constituting a given state has not yet decided the size of
people whether it is too large such as that of china or too small like that of Vatican
cannot determine the existence of a given state. That is, there are states with large
number of people and other state with small number of people: whatsoever the
number of people there may be, there are states in this world.
The people constitute a basic element of the state since the state as a social
organization cannot be devoid of men and women. While there is no agreed size of
population that should be constitute a state, Mongethau contends that ―without a large
population it is impossible to establish and keep going, the industrial plant necessary
for the successful conduct of modern war, to put into the field the large number of
combat group to fight on land, on the sea, and in the air…‖ Mogenthau`s position
presupposes that there is the material and technological support for the large
population as in the United State which provided the background for his literature.
By his preposition, China whose population is in the region of one billion could have
been the most powerful and the greatest nation in the world. Perhaps it is only
necessary to state that countries with small populations and territories and which are
lacking in technological development are ill placed or disadvantaged in the scheme of
` things among the community of states. Whether a state develops into a

nation or a nation-state depends on the attitude of her people, the leadership and the
leader.
Every nation or state has people within its borders. Ideally; it should be a population
with a sense of cohesion, of being a distinct nationality, having a common language
but is often not a case. States with populations diverse in language, culture or
identification are called multinational states.
B)Territory: is another essential element of the state referring to an are or a certain

portion of earth‘s surface, which is internationally delineated or demarcated and on
which people of a state are expected permanently reside. Once people are mandatory
for survival of the state there must be an internationally bounded area on which they
must settle. To J.C Johari, an area devoid of population, or, territorially traversed or
settled by people cannot be a territory; that is, it should be permanently settled.
Putting it differently, territory of a state consists of the land bodies, water bodies and
their resources, and the airspaces exactly above the area of the state. No state should
have the right to claim up on the territory of another state.
A specific geographical area claimed to belong to the people. It is hard to have a state
with out territory. However, most states are artificial things, few have natural
boundaries. The size of the territory is an important determinant of the viability of
the state in terms of resources.
For example, while the united state of America and the soviet Union with very vast
territories and vast natural resources required for their needs, could not be said to be
self-reliant, most smaller countries of Africa, South America and South-east Asia
which constitute ―one crop, one product‖ countries could at least, be described as
self-reliant.
Related to resources is technology. Where a country has an industrial base to fully tap
the resource within a territory as in Britain, Germany, and U.S.A, national power is
ensured. The climate and geography of the territory would also determine how self-
reliant the state would be. Thus, tropical, land-locked states of Africa, such as Chad,
Nigeria, Equatorial Guinea, Uganda, Burkina Faso, that are technologically and
industrially weak, are further put at a disadvantage by their geographical location.
C) Government: is the agency or machinery of the state exercising both internal and
external aspects of sovereignty on behalf of the state. Since state is an abstract entity,
government undertakes both internal and external functions in the name of the state. It
is the element that has put an end to the prevalence of chaotic and disordered nature of
society.
D) Sovereignty: Signifies the ultimate or supreme authority of the state in both its
internal and external affairs. The state would not compromise its authority to ant
supreme entity both internally and externally: because it is implies that there is no
power and authority which is beyond and above that of the state. Since a state is
sovereign it determines its own form of government, economic systems, domestic and
foreign policies, and on all matters of its own.
There is another not essential but supplementary element of the state: that is
international recognition. It is simply an external acceptance of a newly emerging
independent state by other states in the world. Recognition is an accessory not
necessary element for the reason that it can not determine the survival of a given state
in this real world. That is, a state can exist without getting international recognition.
Take for example, Somaliland; it exists as a state but not international recognition is
conferred to it.
Sovereignty refers independence from external interference. I.e. it governs it self as a

sovereign entity. By definition, all nations or states are sovereign and independent,
but some are sovereign and independent than others. After 30 years of war (1618-
1648) between the Protestant and traditional Catholic churches, in 1648 in the small
German town of Westphalia the secular leaders of Europe met and signed the ―Treaty
of Westphalia‖ to end internal conflict between protestant and catholic versions of
Christianity. This situation gave an opportunity to the kings (princes) to decide
whatever they wish; including which of the two aspects of Christianity would prevail
within his kingdom.
For the first time in history, a state now existed that was led by a single ruler who
recognized no higher authority over him than himself. After the treaty of Westphalia,
by implication, there existed no limit to what kings could do. They had the power life
and death, the power to go to war as they pleased, to tax as they pleased, to determine
what the social orders of their states would be, as they pleased. This led to the whole
concept of power which had to be given name sovereignty, by the French
philosopher, Jean Bodin (1576).
He had described sovereignty essentially as the absolute, indivisible, and complete

power of the king or queen over the people in his/her territory. There are similarities
between his concept of sovereignty and Thomas Hobbes‘s justification of absolute
monarch. What happened after the Treaty of Westphalia was the emergence of
absolute monarchy. It soon became known as the nation-state. In the nation state, the
government is sovereign. There is no organization, no idea, and no structure superior
to the government of the state.
Sovereignty denotes the supreme and final legal authority, over and beyond which no
further legal power exists. Individuals, groups and organizations exist within the state,
and they could make rules guiding the conduct of their own businesses and
organizations, such rules deriving from the freedom granted by the state and at the
mercy of her legal power. The state is perpetual, indivisible and inalienable, and it is
the supreme power over citizen and subject, un-restrained by law. In other words, the
sovereign authority cannot be surrendered or delegated.
2.2 Theories in the origin of state
2.2.1 The Natural or Evolutionary Theory
What is natural or evolutionary theory?

This is sometimes named as genetic theory, which is a theory that considers that state
as natural to organized and settled social life. It claims that the state gradually evolved
from out of earlier forms of settled human communities, such as the family, the clan
and the tribe. This is, state is the product of the natural or gradual expansion of the
family. It is the oldest theory that has lost its ability to explain the complex
phenomenon of the rise and function of the state.
2.2.2 The Divine Right Theory

What is the core idea of this theory regarding the origin of state? Could you give
example for this theory dear student?
This is perhaps the oldest/earlier theory concerning the origin of the state. It claims
that the state to be of a divine creation. That is, the state is considered as an institution
created by God, and rulers were regard as the representative or vice reagents of God
in the earth. It is the will of God that in human society some are born to rule while
others are born to be ruled. Moreover, this theory asserts that the social order, in
which the position if the individual is determined hierarchically in the basis of the
birth, was God-given and Thus immutable. There is hereditary succession of authority
of the rulers who should be held responsible for and accountable to God only, not to
people.
The rulers, particularly Kings, considered themselves and their male descendents to
be elect of God to rule over the rest of the society whom they considered as subject,
not citizens ages. Even in Ethiopia context in the contemporary period you can take as
example that Haileselassie`s government. In short, the point here is that the will of
God is the source for creation of state and authority of the rulers.
This theory states that God created the state and that he had a reason for doing so. For
example, St Augustine, declared that obedience to state even when ruled by unjust
men and women is a divine remedy for sin. i.e. God created the state as a solution for
original sin. Salivation was attainable only by obedience to the state during one‘s time
on earth. Kings are legitimate agents of God.
The concept divine right rule explains that if God created states, God created the
government and decided who should govern. I.e. God chose kings or queens. In the
middle ages, rulers in European states claimed that God had entrusted them with the
authority to rule the people. The notion of the ―divine right of kings‖ was the political
formula that was used by kings and princes of those times to secure the obedience of
the population. They attempted to present and use the Bible as the source of the notion
in order to be accepted by their subjects with out any question. It was only at the end
of the seventeenth century that the claim of divinity lost ground
2.2.3 The Social Contract Theory

What is the social contract theory?
Here to this theory, what matters for the source of creation based on the contract or
agreement is the people at large. This theory came into being in the 16 th, 17th, and
18th centuries whose strong ground of argument was the doctrine of popular
sovereignty. According to the theory, the source for establish of the state is the
consent (will) of the people and hence the main purpose of such state is to protect and
safeguard the inalienable right of the people such as the right to life, liberty, and
properly. A social contract is an agreement that creates a state and its government.
There are three versions of this theory.
Hobbes (1588-1679) begins his theory with the assertion that in early days, people
lived in a primitive society which he calls ―the state of nature‖. It was a time and a
place where everyone was at war with everyone else-where greed and violence so
undermined the hope for stability that people feel into a state of despair. According to
Thomas Hobbes (in his book the Leviathan-1651) life was ―nasty, brutish and short‖.
There was no relief in the context of the state of nature from the action of evil people.
Certain more rational individuals sensing the hopelessness of the situation came
together and decided to do something. They made a contract in which one individual
was selected to rule over the rest. The people would agree to obey the ruler in all
cases. The people gave up all future political rights. But, with the rule of the sovereign
monarch there was at least that sufficient order could be created wherein people could
have families, homes farms and some means of livelihood that could not arbitrary
taken away. Hobbes in effect said that people created the state under an authoritarian,
in a social contract. The fear of violence, in effect; ―civilized‖ humanity by causing
people to create the state. This was pessimistic view of the social contract. It was also
a one way contract.
John Lock (1632-1704) in his book ―Second Treaties of Government‖ written in

1690, Lock indicated that the state of nature was not quite as bad as Hobbes would
have it. There were dangers, but there were rational people as well. These rational
people realized that the need for order, law, and predictability and for a monopoly of
power under some organized structure. They made a two-way contract with the
monarch. The people would obey the monarch, keep the law, pay taxes and do other
reasonable things that the monarch decreed. On the other hand, the monarch owed
something to the people. She or he owed them protection for their lives, their liberties
and their properties. The contract then called for obligations on the part of both the
monarch and the people. The monarch could punish the people if they broke the law,
but if the monarch acted in such a way as to undermine life, liberty and property, the
people could punish or deposed him by force if necessary. In effect, in John Lock‘s
view of the social contract, the monarch, by breaking the contract gives the people the
right of revolution.
Jean Jacques Rousseau (1712-1778) Rousseau in his book ―the social contract‖ began
with the state of nature. However, he differed from Hobbes and Lock in that in his
state of nature, life was rather pleasant. The state of nature in Rousseau‘s version was
simply a state of unstructured human kind. Rousseau argued that it was the so called
process of civilization itself that created the phenomena of greed, lust and violence
that so beset society both in his time and in our own. The coming of nation- states had
made things worse. It was time for a new social contract in which citizens of a new
kind state would agree to meet and discuss in which all would participate, there would
arise a consensus that would be called the “General will‖(the common consensus of
the population on any issue). Once the general will was known, it was sovereign. In
the version of Rousseau, the state had to be rather small.
Contrary to the unflattering image of vile and insecure creatures depicted by the two
English writers, Rousseau in the Discourse on the origin of Inequalities (1755)
painted a portrait of essentially gentle and timid beings living harmoniously in a
tranquil, if primitive, state of nature. Humans in this condition were neither inherently
good nor evil, Rousseau believed, but were guided by such benign ―natural‘
tendencies as nonviolence and pity for one‘s fellow man.
The primitive human being was a ‘‘noble savage‖, peaceful and uncorrupted,‖ free
healthy, honest and happy‖. As long as there was no organized social life, however,
humanity could not improve its material welfare or educate itself about the universe in
which it dwelt. The noble savage was a child, barely above the level of animals.
It was precisely by developing a more complicated economy that humankind built the
basis of ―civil society‖, that is, organized group relationships. In Rousseau‘s view,
this process began with the advent of private property, with the development of wider
social interactions and an explicit division of labor. All the evils of advanced social
life came:-geed, vanity, social inequality and aggression. It is society that corrupts
human beings and encourages evil tendencies.
In his ‗social contract‖, he argued that government must be based on popular consent.
In order for a government to be truly legitimate, the people in each generation should
have the option of accepting or rejecting it. Legitimacy is, therefore, based on a tacit
social contract among free people who collectively constitute what Rousseau calls
“the sovereign‟. It is the collective sovereign that is the ultimate source of law. The
people are capable of conferring legitimacy on whatever form of government. The
general will is the common good; it represented what is best for the community may
be in the interest of a single individual or a segment of the community at any given
moment. For Rousseau, freedom ultimately depends upon conformity with the general
will: the liberty of each depends upon the liberty of all. If the general will were to
break down a plethora of competing individual wills, humanity would loss its freedom
to govern itself on the bases of common interest. Life would become insecure for
everyone and tyrants would impose their own wills on the rest of society; no one
would be free. To avoid such a breakdown of sovereignty, everyone must ultimately
subordinate his or her private will to the community collective interest.
The social contract theory was further developed in the age of revolutions in the fight
against the rule of non-democratic systems in general and against absolute monarchies
in particular. It firmly advocated popular sovereignty, limited government and

individual right. Though it gave priority to individuals over society as its limitation,
this theory is currently operational in international politics. Its exponents were the
British political thinkers like Thomas Hobbes (1588-1679) and John Locke (1632-
1704), and the French thinkers Jean – Jacques Rousseau (1712-1778).They were great
thinkers who contributed much to the development of contemporary democratic
political system.
2.2.4 The Force or Conquest Theory
What is force or conquest theory?
This theory associates the emergence of the state to wars and conflicts (i.e., inter-
communal or inter-societal) that have been endemic in history of human beings.
According to this, the state is the result of naked force applied by the stronger over the
weak. That is wars of conquest resulted in the occupation of more and more territories
and lead to the creation of the state. This theory argues that warfare or military might
and physical strength plays a defining role in the formation and continued sustenance
of the state is done through the process of conquest, subjugation and coercion of the
weak by the strong. In other words ―might (force) make right‖ lies the ground for
establishment of state in this theory.
According to this theory, the state comes about by virtue of a superior being or group
of beings who enforce their will over other people. These individuals or groups decide
to create an institution for their own purpose and they bind the people together
through force (either physical or psychological).The leader defines the territory.
Example, Adolf Hitler, Napoleon Bonaparte, etc.
What do you think is the limitation of this theory?

However, although the state can and does use force, military might and physical force
alone cannot explain the complex phenomenon of political system, for mere force
cannot maintain that lasting relationship between the rulers and ruled.
2.2.5 The Marxist Theory
What is the central idea of Marxist theory?

This theory claims that the state emerges due to warfare within a society: this is more
of intra-societal war carried out between classes. Particularly, Karl Marx popularized
this view by analyzing the state as an agency of class warfare by which the capitalist
classes control the working classes. In other words, the state was originated from the
split of society into social classes with sharp and polarized economic interests. The
formation of social classes is associated with the emergence of private property.
The rise of the state with its agent, the government established to make laws, is
therefore, directly related with the emergence of private property and the need to
safeguard it. That means the state in its functions is a partisan political organization
that stands for the interest of the rich against the poor. Therefore, the supporter of this
theory suggests that with the historical process of disappearance of private property
and antagonistic social classes, the state will wither away and a classless society
should be established within which everybody will be equal and all have whatever
they want.
Marxist theories of the state were relatively influential in continental Europe in the
1960s and 1970s. But it is hard to summarize the theory developed by Karl Marx and
Friedrich Engel. After all, the effort by Hal Draper to distill their political thinking in
his Karl Marx's Theory of Revolution (Monthly Review Press) took several thick
volumes.
For Marxist theorists, the role of modern states is determined or related to their role
in capitalist societies. They would agree with Weber on the crucial role of coercion in
defining the state. (In fact, Weber himself starts his analysis with a quotation from
Leon Trotsky, a Bolshevik leader.) But Marxists reject the mainstream liberal view
that the state is an institution established in the collective interest of society as a
whole (perhaps by a social contract) to reconcile competing interests in the name of
the common good. Contrary to the pluralist vision, the state is not a mere "neutral
arena for settling disputes among contending interests" because it leans heavily to
support one interest group (the capitalists) alone. Nor does the state usually act as
merely a "collection of agencies which themselves act as simply another set of interest
groups," again because of the state's systematic bias toward serving capitalist
interests.
In contrast to liberal or pluralist views, the American economist Paul Sweezy and
other Marxian thinkers have pointed out that the main job of the state is to protect
capitalist property rights in the means of production. At first, this seems hardly
controversial. After all, many economics and politics textbooks refer to the state's
crucial role in defending property rights and in enforcing contracts. But the capitalists
own a share of the means of production that is far out of proportion to the capitalists'
role in the total population.
More importantly, in Marxian theory, ownership of the means of production gives

that minority social power over those who do not own the means of production (the
workers). Because of that power, i.e., the power to exploit and dominate the working
class, the state's defense of them is nothing but the use of coercion to defend
capitalism as a class society. Instead of serving the interests of society as a whole, in
this view the state serves those of a small minority of the population.
Among Marxists, as with other topics, there are many debates about the nature and
role of the capitalist state. One division is between the "instrumentalists" and the
"structuralists."
On the first, some contemporary Marxists apply a literal interpretation of the

comment by Marx and Frederich Engels in The Communist Manifesto that "The

executive of the modern state is but a committee for managing the common affairs of
the whole bourgeoisie." In this tradition, Ralph Miliband argued that the ruling class
uses the state as its instrument (tool) to dominate society in a straightforward way.
For Miliband, the state is dominated by elite that comes from the same background as
the capitalist class and therefore shares many of the same goals. State officials
therefore share the same interests as owners of capital and are linked to them through
a wide array of interpersonal and political ties. In many ways, this theory is similar to
the "power elite" theory of C. Wright Mills.
Miliband's research is specific to the United Kingdom, where the class system has
traditionally been integrated strongly into the educational system (Eton, Oxbridge,
etc.) and social networks. In the United States, the educational system and social
networks are more heterogeneous and seem less class-dominated to many. But a
social connection between state managers and the capitalist class can be seen in the
dependence of the major politicians and their parties on campaign contributions from
the rich, on approval from the capitalist-owned media, on advice from corporate-
endowed "think tanks," and the like.
In the second view, other Marxist theorists argue that the exact names, biographies,
and social roles of those who control the state are irrelevant. Instead, they emphasize
the structural role of the state's activities. Heavily influenced by the French
philosopher Louis Althusser, Nicos Poulantzas, a Greek neo-Marxist theorist argued
that capitalist states do not always act on behalf of the ruling class, and when they do,
it is not necessarily the case because state officials consciously strive to do so, but
because the structural position of the state is configured in such a way to ensure that
the interests of capital are always dominant.
Poulantzas' main contribution to the Marxian literature on the state was the concept of
relative autonomy of the state: state policies do not correspond exactly to the
collective or long-term interests of the capitalist class, but help maintain and preserve
capitalism over the long haul. The "power elite," if one exists, may act in ways that go
against the wishes of capitalists. While Poulantzas' work on 'state autonomy' has
served to sharpen and specify a great deal of Marxist literature on the state, his own
framework came under criticism for its "structural functionalism."
But this kind of criticism can be answered by considering what happens if state
managers do not work to favor the operations of capitalism as a class society. They
find that the economy is punished by a capital strike or capital flight, encouraging
higher unemployment, a decline in tax receipts, and international financial problems.
The decline in tax revenues makes it more necessary to borrow from the bourgeoisie.
Because the latter will charge high interest rates (especially to a government seen as
hostile), the state's financial problems deepen. Such events might be seen in Chile in

1973, under Salvador Allende's Unidad Popular government. Added to the relatively
"automatic" workings of the economy (under the spur of profit-seeking businesses)
are the ways in which an anti-capitalist government provokes anti-government
conspiracies, including those by the Central Intelligence Agency and local political
forces, as actually happened in 1973.
Unless they are ready to actually mobilize the working population to revolutionize
society and move beyond capitalism, "sober" state managers will pull back from anti-
capitalist policies. In any event, they would likely never go so far as to "rock the boat"
because of their acceptance of the dominant ideology encouraged by the prevailing
educational system.
Despite the debates among Marxist theorists of the state, there are also many
agreements. It is possible that both "instrumental" and "structural" forces encourage
political unity of the state managers with the capitalist class. That is, both the personal
influence of capitalists and the societal constraints on state activity play a role.
Of course, no matter how strong this link, the Marx-Engel‘s dictum that "The
executive of the modern state is but a committee for managing the common affairs of
the whole bourgeoisie" does not say that the executive will always do a good job in
such management. (As Poulantzas pointed out, the state maintains some autonomy.)
First, there is the problem of reconciling the particular interests of individual capitalist
organizations with each other. For example, different parts of the media may disagree
on the nature of needed government regulations.
Further, it is often unclear what the long-run class interests of capitalists are, beyond
the simple defense of capitalist property rights. It may be impossible to discover class
interests until after the fact, i.e., after a policy has been implemented. Third, state
managers may use their administrative power to serve their own interests and even to
facilitate their entrance into the capitalist class.
Finally, pressure from working-class organizations (labor unions, social-democratic

parties, etc.) or other non-capitalist forces (environmentalists, etc.) may push the state
from toeing the capitalist "line" exactly. In the end, these problems imply that the
state will always have some autonomy from obeying the exact wishes of the capitalist
class.
In this view, the Marxian theory of the state does not really contradict the pluralist
vision of the state as an arena for the contention of many interest groups, including
those based in the state itself. Rather, the Marxian proposition is that this multi-sided
competition and its results are strongly biased in the direction of reproducing the
capitalist system over time.

It should be emphasized that all of the Marxist theories of the state discussed above
refer only to the capitalist state in normal times (without civil war and the like).
During a period of economic and social crisis, the absolute need to maintain order
may raise the power of the military -- and military goals -- in governmental affairs,
sometimes even leading to the violation of capitalist property rights.
In a non-capitalist system such as feudalism, Marxian historians have said that the
state did not really exist in the sense that it does today (using Weber's definition).
That is, the central state did not monopolize force in a specific geographic area. The
feudal king typically had to depend on the military power of his "lieges." This meant
that the country was more of an alliance than a unified whole. Further, the difference
between the state and civil society was weak: the feudal lords were not simply
involved in "economic" activity (production, sale, etc.) but also "political" activity:
they used force against their serfs (to extract rents), while acting as judge, jury, and
police.
Getting further beyond capitalism, Marxist theory says that since the state is central to
protecting class inequality, it will "wither away" once class inequality of power is
abolished. In practice, no self-styled Marxist leader or government has ever made
attempts to move toward a society without a state. Of course, that is to be expected.
After all, no society has ever completely abolished classes.
In addition, no self-described "socialist" country has been able to do without a

military defense against capitalist invasion or destabilization. Third, in Marxian
theory, impetus for the abolition of the state would not come from the leaders or the
government themselves as much as from the working people that they are supposed to
represent.
2.3 Structures of state

Structures of state refer to forms of state indicating the nature and distribution of
power and authority at various levels or tiers of government. Here, therefore, in
view of the nature and distribution of political power and authority, one may
broadly classify state in to three structures, unitary, federal and the confederal.
2.3.1 The unitary structure

What is unitary state in general?
Generally speaking, unitary state is a form of state in which the nature of political
power is highly centralized at the centre upon the national government. National
government is the central unit upon which constitutionally all political powers are
usually centralized to carry out all administrative affairs in the behalf of the state.
Accordingly, legislative authority is only versed in the national government.
Dear distance learners, what do you mean by legislative authority?

Legislative authority is simply an authority legally given to state agency to enact or

make constitution or law. And, this authority is only of the national unit in most
unitary form of state and hence, the expectation is that there is constitution only at the
national level. That is, all administrative policies and principles originate only from
the centre. This is because no shared legislative authority to regional units.
Dear distance learners, do you think there are regional units in unitary state?
Well, your answer may be yes, or no. it could be yes, because all powers are
constitutionally in the hands of the national units and hence all administrative
activities should be undertaken by this unit. In effect, the national government
sometimes be overburdened with huge activities and may design some mechanisms in
how to relax and particularly to bring about smooth administration at the localities.
Typical of these ways is the national unit should establish regional units based on its
interest and share its power. Regional governments in unitary state not establish by
consent but by the will of the national government. Again if you reply no, still you
are right. Regional units may not be in this form of state for the simple reason that the
constitution does not allow for their existence, which is unlike the national
government whose source of creation is the constitution.
Another point is, what is the nature of relationship the regional units (if there are any)
have with the national government here?
As far as the source of establishment of regional units here is the interest of the
national government, their legal existence significantly depends upon still the will of
the central unit. Having established them, it can grant them certain power and
authority or leave and them without any. So, in unitary state there will be only one
source of creation and power ad authority for regional governments, that is the central
government. This indicates that there are no authorities and powers left to local units
that they can independently exercise from the central government.
Whatever activity the local units going to perform should first be commanded from
the center from where most policies and decisions are shaped and sent down to local
units. In this case, local/regional units have no independent decision making power
and authority at least for some particular matters of their own. In unitary states the
justification or the rationale for the existence of local/regional units is just to serve as
an administrative agent of the central government and they are considered as a means
to the central government to have a reach to local areas or to facilitate smooth
administration there. This means they are created just to bring administrative
convenience for the government. The other point is that the existence of the local
units in unitary state is dependent up on the will of the central government. The
national government can at any time reduce their power, or diminish it or even end
their existence. Therefore, these regional or local units are highly subordinated or
subservient to only the will of the national government: that is, they feel inferred to
the centre while the latter feels superior to them.
May you list down some advantages and disadvantages of unitary state?
Some major advantageous parts of the unitary state structure include:
 It plays a great role in uniformity of decisions, political activities and services;
 Uniform of laws, rules and policies and
 Emphasizes on equal access to public service and resources for all units; etc.
Some major advantageous parts of the unitary state structures include:
 Effective administration may be difficult;
 Doesn‘t encourage participation at the grass root levels;
 Not effective in managing economic and cultural diversities;
 Inter-regional competition may not be encouraged;
 Due to centralization of power at the centre there may be misuse of
power…etc.
Great Britain, Japan, Spain, Romania, Poland, Netherlands, Belgium, Scandivian
countries are some examples of unitary states. Ethiopia also had unitary state structure
until 1991.
2.3.2 The federal structure

What is the federal state?
Federal state is almost the direct anti-thesis (opposite) of the unitary where there is
constitutional decentralization of power from the centre to the regional governments
(i.e. devolution of power0,and hence both the centre and regions have certain
independent sphere of authority to make decisions independently of each other.
That is, unlike the unitary, the source of creation and power of both the federal
(national or central) government and of the regions are the constitution. This poses
limit on the extent of power to be enjoyed by the central unit and distributes power to
the federal units to allow them decide on their specific affairs.
Accordingly, there are two levels or tiers of government, or federal state is composed
of two federated units, in between which legislative authority is constitutionally
shared. Although that of the federal has supremacy upon the regional, one can find
constitutions at the national and the regional levels since both units have the legal
authority to legislate at their respective levels. Consecutively, dual subjectivity is one
of the central features of the federal states.
Dear distance learners, what do we mean by dual subjectivity here?
Needless to say, dual subjectivity is usually common in federal form of state that
simply to mean the situation in which citizen of a given state are being subject to (
when they observe/obey) two constitutions simultaneously: one, of the federal
constitution, the other, of the regional constitution once at a time.
In other words, citizens in federal state should observe regional constitutions to

which they belong. And they are expected to be subject to the federal constitution

because federal constitutional has supremacy upon all regional constitutions. This is
primarily attributable to the shared or legally divided legislative authority between
both the central and regional units.
Could you say something on the nature of relationship between the federal
government and the regional units in federal state? Can you find any point of
departure from that of the unitary form?
Since the source of establishment and the power and authority of both is the
constitution, the extents of this power and authority granted, and the legal existence of
the regional governments depends upon the constitution, not on the consent of the
national/federal government. Unlike the unitary, there is no a sort of superior-
subordinate relationship between them rather a kind of collaborative (cooperative)
relationship is expected as a crucial feature of federal form of state.
Could you try list down some advantageous of federal state?
Some major advantages of federal state are:
 Its ability to manage diversity: it is very much applicable to multi-ethnic
society as a means of compromising their interest;
 Reflects the interest of the people in the local areas because they are
authorized to make decision for themselves;
 It enable to manage large territory and population;
 Healthy competition among units helps to reinforce development
 Eases the burden from the centre, and, the like.
What about some of its disadvantages?

Some of the disadvantageous of federal form of state include:
 There is a possibility of conflict of jurisdiction between the federal and
regional governments because of duplication of power between the two levels;
 It is costly for the reason that it requires ample economic resources to run
double set of governments.
 It requires educated man power;
 It creates a weak government by dividing internal sovereignty;
 It may also cause lack of uniformity in decision making since authority is
divided; and, so forth.
Examples for the federal form are Ethiopia (after 1991), Nigeria, USA, Switzerland,
Germany and etc. Dear student, remember here that regarding the two forms of state,
what are advantageous for the federal form of state are disadvantageous in the unitary
form and the vice versa.
2.3.3 The Confederal state structure

What is the confederal state?

The confederal state is a voluntary association of independent states established to

realize their common but usually specific objective. Confederation is a voluntary
association because its member sovereign states join such association on the basis of
their interests just to foster or achieve their collective benefits that they cannot
individually. The member states can be unitary as well as federal.
Most of the time, the objective behind establishment such association of the state are
limited or specific such as economic, political, military, or the like. For example, if
you take Northern Atlantic Treaty Organization (NATO), its prime objective is to
promote common defense for the member states, which is only for the military
purpose.
The members of NATO are from both the federal and unitary forms of states; such as
USA, Britain, and the like. State can also form confederal associations for
multifaceted purposes at regional, continental and international levels where they can
achieve their common benefits without affecting their internal freedom, structure, law
making and enforcing process and their external relations.
Here, dear student, the other point that should bear in mind is that, relatively from
other two forms of state, the central organ or agency in confederal form is so much
weaker than its peripheries. The peripheries are the member sovereign state. The
centre coordinates and facilitates some activities, make decision and take actions only
on the basis of the interest of the member states. This is because the member states are
vested with their respective sovereignty that makes them powerful and consecutively,
coercive power is their not of the central agency of the confederal structure. The other
crucial point is that such state structure historically served as the first or second step
for establishment or realization of most contemporary federal state structures. You
can take federal states like USA, Germany and Switzerland as example in confederal
form.
UNIT THREE
GOVERNMENT
Section One: Government and its Forms

Section overview
1.1. What is government?
1.2. Forms of government
1.1. What is government?

State is an abstract entity that stands for a number of particular institutions within a
society. It is those institutions that together constitute the reality of the state and that
interact as parts of the state system. The major part of the state system without which
state cannot exist is the government. Government is the soul of the state that has

maintained existence of state and has terminated the anarchic and disordered nature of
society. It implements the will of the people on the behalf of the state. Because the
latter is an abstract it is the government that performs all administrative affairs both
internally and externally in the state. Remember here that performing both internal
and external functions of the state implies exercising the internal and external
sovereignty (ultimate power) of the state. Thus, though it is the necessary attribute of
the state, sovereignty is always exercised by government on behalf the state.
Government as political organization comprising the individuals and institutions

authorized to formulate public policies and conduct affairs of state. Governments are
empowered to establish and regulate the interrelationships of the people within their
territorial confines, the relations of the people with the community as a whole, and the
dealings of the community with other political entities. Government applies in this
sense both to the governments of national states, such as the federal government of
the U.S., and to the governments of subdivisions of national states, such as the state,
county, and municipal governments of the U.S. and the governments of the provinces
of Canada. Such organizations as universities, labor unions, and churches are also
broadly governmental in many of their functions. The word government may refer to
the people who form the supreme administrative body of a country, as in the
expression ―the government of Prime Minister Churchill.‖
Therefore, government is the administrative machinery or agency of state that brings

the intangibility (invisibility) of the state in to a concrete reality. It is held responsible
to carry out the day to day affairs of state. It is an essential political organ that
coordinates the routine activities of the state & maintains law and order. That is, it
carries on state‘s function, institution, or apparatus through which state sovereignty is
instrumental and hence functions of state are accomplished.
Dear distance learners do you know something about the history of government?
The despotic empires of Egypt, Sumer, Assyria, Persia, and Macedonia were followed
by the rise of city-states, the first self-governing communities, in which the rule of
law predominated and state officials were responsible to the citizens who chose them.
The city-states of Greece, such as Athens, Corinth, and Sparta, and of that part of Asia
Minor dominated or influenced by the Greeks, provided the material for the
speculative political theories of Plato and Aristotle.
Aristotle's system of classifying states, which influenced subsequent political thought

for centuries, was based on a simple criterion: good governments are those that best
serve the general welfare; bad governments are those that subordinate the general
good to the good of the individuals in power. Aristotle distinguished three categories
of government: monarchy, government by a single individual; aristocracy,
government by a select few; and democracy, government by many.

The later Greek philosophers, influenced by Aristotle, distinguished three degenerate

forms of the classes of government defined by him. These were, respectively, tyranny,
rule by an individual in his or her own interest; oligarchy, rule by a few people in their
own interest; and Aristocracy, mob rule. Still other categories of lasting historical
significance are theocracy, rule by religious leaders; and bureaucracy, the excessive
domination of government by administrative officials.
Ancient Rome, which evolved from a city-republic to the seat of a world empire, also
greatly influenced the development of government in the Western world. This
influence was derived in part from the great Roman achievement in formulating
clearly for the first time the principle that constitutional law, establishing the
sovereignty of the state, is superior to ordinary law, such as that created by legislative
enactments.
After the fall of Rome, the Roman concept of a universal dominion was kept alive
during the Middle Ages through the formation of the Holy Roman Empire; and also,
in part, by the establishment, through canon law and ecclesiastical courts with
jurisdiction over secular affairs, of the ruling body of the Roman Catholic church.
The effect of these influences was to retard the development of national territories and
governments after tendencies in that direction had manifested themselves among the
feudal principalities of Europe. On the other hand, the struggle of the feudal barons to
limit the absolute power of their monarchs eventually produced many contributions to
the theory and institutions of representative government. During the middle Ages
commercial city-states arose in Europe. These city-states eventually formed the
Hellenistic League and the powerful Italian city-republics, or communes.
The final emergence of national governments is attributed to two principal causes.

One comprises a number of underlying economic causes, including a great expansion
in trade and the development of manufacturing. These conditions began to undermine
the feudal system, which was based on isolated and self-sufficient economic units,
and to make necessary the creation of large political units. The other cause was the
Reformation, which succeeded in eliminating the restraining influence of the Catholic
church on political development in a number of European countries.
The modern nation-state became a definite form of government in the 16th century. It
was almost entirely dynastic and autocratic. The will of the reigning monarch, in
theory and often in practice, was unlimited; the famous aphorism of King Louis XIV
of France, ―L'état, c'est moi‖ (―I am the state‖), was not an idle boast, but an
expression of existing reality. In time, however, the demand of the bourgeoisie for
constitutional and representative government made itself felt, and the unlimited
powers of monarchs began to be challenged. In England, the Glorious Revolution in
1688 restricted such powers and established the preeminence of Parliament. This
tendency culminated in two events of historic importance, the American Revolution,

beginning in 1775, and the French Revolution, beginning in 1789. Historians

generally date the rise of modern democratic government from these events.
The history of government in the 19th century and in part of the 20th is notable for the
broadening of the political base of government through extension of suffrage and
other reforms. A tendency that became especially marked in the 20th century was the
development and implementation of the concept that government, in addition to
maintaining order and administering justice, must be an instrument for administering
public and social services including, among many others, conservation of natural
resources, scientific research, education, and social security.
Between 1945 and 1951, the Labor Party government of Britain extended the
responsibilities of government to include nationalization of a number of basic
industries in a need for stringent economic planning. Other outstanding developments
of the 20th century were the appearance of the corporative state and of totalitarian
governments in a number of countries, and the first so-called proletarian dictatorship
in history, the Union of Soviet Socialist Republics. From the late 1940s until the end
of the 1980s, most eastern European countries adjacent to or near the USSR had
governments similar in many respects to that of the USSR.
Major Functions of Government
The functions with which a government should respond to needs of societies vary in
different places and periods. Some functions are as old as the government itself while
other functions are added recently. Moreover, today there have been debates among
scholars regarding to which affairs of a society the function of government are to be
limited or not to be limited. In fact, different states attempt to address such debates
depending upon the nature of their political system they pursue. However, there is a
general agreement that the government must be held responsible for performing
certain functions that are vital to a society. Typical of these crucial functions are the
following.
Maintenance of law and order in a society- Government is primarily and directly

held responsible to maintain law and order in a society. For the normal functioning of
social affairs, maintaining social order is so vital for a give society. In the absence of a
certain degree of social order, all aspects of social, economic and political life of
society will disrupted. Thus, there should be government to maintain order there so
that various aspects of societal affairs would properly function. The crucial means to
do so is the existence of law in the society. Law is made, implement and enforced by
organ of government within a society, which are crucial to regulate the day today
behavior and interactions members of the society.
Providing citizen with protection and security- Government also has responsibility
to protect its citizen against collective threats and dangers of aggression. In doing so,

the government ensures security of its citizens. Citizens mainly depend on their
government for protection of their right and privileges as well as their material
properties and possessions. They also need to have security of their lives. Domestic
security is protected by domestic laws and, when necessary, by the use of force. The
government can also challenge external threats and insecurities through diplomatic
efforts, international law and ultimately through the use of violence or war for
defensive purposes.
Providing citizens with services and welfare- Particularly nowadays, government is
increasingly engaging in the area of provision of social and economic welfare to its
citizens. The government usually designs various policies related to welfare issues.
Such policies are supported to redistribute resources and benefits to various members
of society. For example, the government deliberately intervenes to benefit the most
affected and impoverished segments/section of society in terms of education, health
and social facilities.
Supervision and resolution of Conflicts- in any political system it is obvious that

there are clashes of interest among different parts and interests; the government has
the responsibility to reconcile these conflicts by employing different means. All
governments develop institutions and procedures for the management of conflict after
their occurrence. These may include the legislative, executive and judiciary along
with established procedure to manage disputes arising within a society. Some
governments may also provide other institutional and informal mechanism of conflict
management such as voting right, majority rule protection of minorities and the like.
The difference between state and government
Dear distance learners, could you differentiate state from government?
It is a different matter that most people use the concept of ‗state‘ interchangeably with
other terms like ‗government‘. This is due mainly to lack or precise understanding
about the concepts. Here, to take up with correct understanding of the two terms, the
following are some of the grounds for their principal differences forwarded by J.C.
Johari 92006). These are:
 Relatively, the state is a wide/ broader entity including all citizen of the
country while the government is a smaller unit covering only those that are
employed to perform its functions. That is, the state is the bigger entity for the
promotion of common ends and the satisfaction of common needs. But
government is the essential element and agency of state through which the will
of the state is formulated. That is the ends and purpose of the state are
executed through the instrumentality of the government;
 The state is an abstract entity, but the government has its existence in a
concrete form because it includes all persons in the legislative, executive and
judiciary departments. In other words, the government is a practical and
concrete organization through which the will of the state is formulated,
expressed and realized;
 While the power of the state is primary and original, the authority of the
government is something delegated and derivative. That is, the power of the
state is absolute and unrestricted by anything on account of being a sovereign

entity, where as the authority of government is limited by the provisions of the
constitution;
 Primary owing to its sovereignty, state is regarded as permanent and
independent institution. State survives and is always there unless its
sovereignty is destroyed by the invasion of some other states. But government
is changeable or dynamic, it always comes and goes. As far as one party is
changed by another new party, office holders of government are changed. The
frequent changes in government cannot affect the continued existence of state;
 Because all state across the world is made up of their four essential elements,
they are not of various kinds. That is, they are the same throughout. But
governments are of different forms such as monarchy, aristocracy, oligarchy,
democracy, dictatorship etc;
 The other crucial point is that membership to the state is something
compulsory where as that of government is an optional matter. Aristotle
asserts that because people are political animal by nature and necessity it must
for them to belong to the state. But it is up to in interest of the people to have
or not to have posts in the government, and. so forth
1.2. Forms of governments

A) Ancient forms of Government
Plato‘s and Aristotle‘s classification based on two questions. Who rules? and in
whose interest? According to Plato there are two basic ways in which rules may be
conducted; lawfully and lawlessly. Either the governors are bound by constitutional
rules that they are not free to set aside, or they rule according to unchecked whims
and emotional desires. The first is based on the rule of law, the second on arbitrary
rule of individuals. Rule by law is in the general interest of the entire community,
whereas arbitrary rule represents exploitation of the ruled for the special interest of
the governors.
Who governs (rules?) Legitimate form (lawful) corrupt forms(lawless)
Rule by one monarchy Tyranny
Rule by few (minority) Aristocracy Oligarchy
Rule by many polity Democracy
Monarchy: - is a benevolent dictatorship. Government power is vested in a person
of preeminent virtue and wisdom. The ideal monarch rules on behalf of all and will
not benefit any one or group at the expense of another. But monarchies can
degenerate in to tyranny, the corrupt form, under which the monarch exercise all
power for the benefit of himself or herself and ignores the good of the people.
There are two kinds of monarchy: traditional and constitutional.
Traditional monarchy is a monarchy where the king or queen maintains his /her
position by the claim of legitimate blood decent and relationship than their appeal as
popular leaders. Constitutional monarchy is where the king/queen is ceremonial

head of the state, an indispensable figure in all great official occasions and a symbol
of national unity and authority of a state but lacking real power.
Activity: Identify countries which have constitutional and/or traditional
monarchy.
Aristocracy: is rule by the most virtuous, intelligent, and morally enlightened in
the state. But this benevolent rule by an elite wealthy class can decay in to
oligarchy, the corrupt form. Instead of governing in the interest of the society, the
oligarchy only wishes to defend their privileged positions.
Democracy: in Aristotle‘s classification, democracy was a corruption of the polity
and the worst form of government because the masses in a democracy blindly
follow the leader of corrupt and selfish demagogues and plunder the property of the
hardworking and the capable. a majority oppressing a minority. It was the rule of
the common people unchecked by legal restraints. Unchecked democracy is mob
rule. It is the tyranny of the majority. The vice of democracy was that the majority
used the state‘s power to confiscate the property of the wealthy minority.
Polity: - The positive counterpart of democracy was polity. Aristotle saw a polity
for constitutional democracy as the most practical form of government because of
the limitations of human kind. All citizens have a voice in the selection of leaders
and the framing of the laws, but at the same time formal constitutional procedures
protect minority rights. It expresses the idea that the rule of the many is good only if
exercised within a fixed constitutional framework that prevents the majority from
oppressing minorities. It represents the balance of public and a private interest
through the political process. Aristotle‘s preference was for a polity or constitutional
democracy. In a sense, polity is a compromise between negative governmental
forms: democracy and oligarchy. If both the wealthy and the poor, the few and the
many, hold a share of power in the state, but neither faction is supreme, they will
check each other.
B) Modern Typology: According to the relationship between state and society
1. Liberal-democrat: British political party of the center-left, formed in March

1988 as the Social and Liberal Democratic Party from a merger of the Liberal Party
and the Social Democratic Party (SDP). The new party was initially under the
temporary joint leadership of David Steel and Robert McLennan, representing the
two former parties. In spite of the election by an overwhelming majority of a single
leader, Paddy Ashdown, by the end of the year, the new party‘s launch was
compromised by the refusal of a group of former SDP activists to join the new
party. Led by David Owen, the ―continuing SDP‖ divided the third-party vote until
it was forced to cease campaigning in 1990 due to lack of support. Early adoption of
the short name Democrats also alienated the Liberal element in the new party,
leading to the adoption of the agreed short name of Liberal Democrats. The low
point of the new party‘s fortunes came in 1989, when it placed fourth after the
Green Party in the European elections.
By the end of 1990 the Liberal Democrats had recovered sufficiently to win the East
Bourne by-election, precipitating the fall of Prime Minister Margaret Thatcher from
power, and in 1991 to secure a victory at Ribble Valley that forced the Conservative
Party government to abandon the poll tax. Ashdown worked to modernize the party‘s
organization and constitution, setting up a computerized membership scheme, and
moderated its policies, effectively ending its flirtation with unilateral nuclear
disarmament and moving the new party toward a more centrist position on economic
policy. The Liberal Democrats also took up a clear pro-European Community stance,
supporting the Conservative government on the crucial vote to ratify the Maastricht
Treaty in 1993.
The Liberal Democrats consolidated a position as a major force in local government,

with more than 4,000 councilors by the mid-1990s. The 1992 general elections,
however, only yielded the party 20 seats, and its percentage share of the vote, at 18
percent, was smaller than the third-party vote in 1987 or 1983. Continued success in
by-elections and the first election of a Liberal Democrat member of the European
Parliament in 1994 were overshadowed by the revival of the Labor Party under Tony
Blair, prompting renewed talk of the Liberal Democrats supporting Labor in the
future. In the 1997 elections, which Labor won, the Liberal Democrats garnered
slightly less than 17 percent of the vote but gained an additional 26 seats in the House
of Commons. This was due to voters turning away from the Conservative Party,
leading to a Labor Party landslide and increasing success for the Liberal Democrats in
both local and national government. The Liberal Democrats increased their number of
seats in the 659-seat House of Commons to 52 in the 2001 elections, which
overwhelmingly returned Blair‘s Labor Party to power. The Liberal Democrats
subsequently picked up two more seats in a by-election.
Unlike the Conservatives, the Liberal Democrats opposed Blair‘s support for the
U.S.-led war in Iraq that began in March 2003. They also opposed the government‘s
policy of allowing universities to charge tuition fees. These positions helped the
Liberal Democrats win support from disaffected former Labor supporters. In the
2005 general election, the party increased its representation to 62 of the 646 seats
2. Totalitarianism: it is a system of government in which one party holds all

political, economic, military and judicial power. This party attempts to restructure
society to determine the values of society, and interfere in the personal lives of
individuals citizens in such a way as to control their preferences, to monitor their
movements and to restrain their freedoms.
The six basic features common to all totalitarian states are:-
1) An all encompassing ideology 2) a single party
3) Organized terror 4) monopoly of communications
5) Monopoly of weapons 6) controlled economy

3. Authoritarianism: - is a system of government in which power is exercised by a

small group with minimum popular input. Command, obedience and order are
higher values than freedom, consent and involvement. Therefore, the citizens are
expected to obey laws and pay taxes that he or she has no voice in establishing. The
group may be a social class (a family, a king, nobility, an elite bureaucrat, a strong
political party) whose principal concern is to forge domestic solidarity at the time of
national need. This type of one party system is typical of the developing countries of
Africa and most of Asian. It is the army that brings authoritarian rule in the wake of
a military coup.
Authoritarians view society as a hierarchical organization with a specific chain of
command under the leadership of one ruler or group. Example, Chile, S.Korea, and
Taiwan were politically authoritarians but developed a market economy in private
hands. The former Philippines president F.Markos, most Latin American states,
Middle East.
Some points about authoritarian government
1) There is a limited purpose and goal to authoritarian government: it
wishes to control the treasury and the major economic resources that
produce the wealth of the nation. Example:-copper, sugar, precious
metals, etc.
2) Authoritarian government wishes to eliminate any possible opposition to
its control. To that end, it devotes a powerful military, a police force and
a secrete police.
3) It wishes to tax the citizens so that it has additional sources of income
4) The authoritarian regime may even wishes to engage in certain public
services that are essential to the society (sanitation, water, power,
building hospitals, schools, monuments, etc)
4. Parliamentary system of government

It is a governmental system that makes the executive dependent upon and responsible
to the majority of the legislative body. Here, the people elected a group of individuals
who arranged themselves into a majority party which is the party with the most
members in parliament.
The majority party forms, from its leadership, a cabinet which takes on the executive,
or policy making and law-recommending functions. The legislative function is done
both members of the parliament and through votes of cabinet members who sit as a
member of parliament in a legislative capacity. The judiciary is essentially
independent of parliament, though it is connected to it through a ministry of justice.
The characteristics of parliamentary government
1) Fusion of executive and the legislative functions.
2) Party responsibility(each party member is responsible to vote for his party)
3) Indefinite terms of office
4) Temporary irrelevance of the minority

5) Collegial executive(i.e. the executive is plural (collection of ministers who

may take decisions as a group and must be in general agreements before
legislation is recommended or policies are proposed, first using the inner
cabinet).Then, the rest followed this collective leadership, and impossible to
disagree.
6) Separation of heads of government and state(PM and president)
5. Presidential system of government
It is the system of government based upon the separation of the executive functions
and powers from the legislative function and power. Under the presidential system,
the presidency would be under the control of a single individual who would make
policy (i.e. request and point the way in foreign and domestic pursuits). A judiciary
would apply the law when it was broken and punish under those deemed necessary to
be enforced. The congress would be bicameral (two houses) and would actually draw
up the laws independent of the control of the executive (this helps for checks and
balances).
In this system an executive (the president) may veto a law passed by the legislature,
and it is very difficult for the legislature to override such a veto. On the other hand, an
executive policy (a suggestion of policy) may be rejected by the legislature which
may write its own ideas of policy in to the law.
The judiciary may declare through judicial review, a law passed by the legislature, in
turn, may change the structure of the judiciary or limit its appellate jurisdiction thus
controlling its activities. Under judicial review, the executive branch may also be
ruled unconstitutional in its actions, decrees and policy decisions, but the executive
retains the powers to appoint judges to the court.
What are the main organs of government? Do you know their respective
principal tasks?
There are broadly three major organs or branches of government: namely, legislative,
executive and the judiciary. They are usually vested constitutionally with their own
specific powers and functions. While the major function of legislature is
enacting/making law, implementations of law are respectively that of the executive
and judiciary organ of government; that is, classifying a government into its three
branches based on their functions.
The legislative organ of government is named differently by different states. For

instance, parliament, congress, assembly are some of them. Besides this, most states
across the world nave two layers or arms of this law making body of government
including the upper and the lower layer.
The executive is the administrative and huge organ of government including most
governmental position such of the president, prime minister and other like that of civil
servant. Because most governmental activities are to be performed here, executive is
larger or broader and relatively powerful branch of government.
What about the judiciary?

The judiciary is sometimes named in democratic society as the guardian of
constitution, which is democratic in nature. Since it is entitled legally to interpret
provisos of the constitution the judiciary is expected to regularly and seriously look
after the constitution and interpret independently so that the respect for and protection
of supremacy of constitution would be well guaranteed. Such positions as courts,
judge, magistrates are included under branch of government.
Section Two: Separation of powers and checks and balances.
Government is the agency through which the will of the state is formulated,
expressed and realized. The organization of this department of the state can be viewed
either territorially (government at the national, provincial or regional and local levels)
or functionally (government acting through its rule making- rule -application and rule-
adjudication departments).
The theory of the separation of powers belongs to the functional aspects. It desires
that the government should have three organs-executive, legislative and judiciary, and
the powers of all them be separate from each other. It is obvious that this doctrine
rejects the duality theory according to which the government has only two organs
(legislative and executive). It accepts the Trinity theory according to which
government has three organs and further stressed that the power of each department
should be separated from the other if the liberty of the people is to be saved from the
crushing authority of the state. In other words, it implies that the three organs of the
government should be kept apart from each other in the interest of individual liberty.
The function of the government should be differentiated and performed by distinct

organs consisting of different bodies of persons so that each department is limited to
its respective spheres of activities and not be to encroach upon the independence and
jurisdiction of others. The whole idea is based on the maxim that power should be a
check to power.
The concept of separation of powers could mean the following:-

1 That the same persons should not form part of more than one of three organs of
government .For example, that ministers should not sit in parliament;
2. That one organ of government should not control or interfere within the exercise
of its functions by another organ. For example, that the judiciary should be
independent of the executive;
3. That one organ of government should not exercise the functions of another. for
example, that ministries should not have legislative powers.
What are the three powers?
a) Legislative power:-It is a power given to a state organ to make, to change, to
amend and /or to repeal laws. This organ through the laws it makes determines
the structure, powers and duties of the different state ministries. It is as well
determines the conduct of citizens and private organizations.
b) Executive power:-is an administrative power. Broadly speaking, the executive
function comprises the whole area of authority to govern, other than that which
is involved in the legislative functions of parliament and the judiciary functions
of the courts. The general direction of policy includes the initiation of
legislation, the maintenance of order, the promotion of social and economic
welfare, administration of public services and the conduct of external relations
of the state. The executive includes all officials, public authorities and agencies
by which the functions of a government are performed. Within the executive are
therefore to be included the civil service, the armed forces, the police, and local
authorities. It is not always to demarcate the functions of the executive as it is so
with the legislative. Its functions could overlap with the functions of the other
two bodies. Example, the executive could initiate legislation and can work with
the legislative in preparing the draft of the law it want to be enacted. It may also
pass decisions on administrative issues and may hear appeals on the issues.
c) The Judiciary:-The primary function of the judiciary is to determine disputed
questions of fact and law in accordance with the law laid down by parliament.
Sometimes, besides the primary function of settling legal disputes, the courts
exercise certain law-making functions. Example, the making of rules of court
procedures.
There are also times the executive could involve in the function of the judiciary. For
example, in some countries, presidents may pardon an offender. Such power to
pardon includes the power to commute a sentence from a heavier to lighter penalty
or to remit a fine in part or entirely.
In considering each of these aspects of separation of powers, it needs to be

remembered that complete separation of power is possible neither in theory nor in
practice. The doctrine of separation of powers was first thought of by an
Englishman by the name of John Locke in 1960 in his work ―Second Treaties of
Government‖.
It was further developed by a French jurist Montesquieu. According to them, if

powers are to be enforced by the same body that makes them, they could result in an
arbitrary rule and make the judge a legislator rather than an interpreter of the law.
Similarly, if the one body or person could exercise both executive and judiciary
powers relating to the same matter, then again, there could be an arbitrary power
which could amount to complete tyranny. It would be even worse if legislative
powers also were added to the powers of that person or body.
The purpose of the doctrine of separation of powers, therefore, remains to be

placing checks and balances which are quite essential in the government of an abuse
of enormous powers which could be concentrated in the hands of one state organ.
The separation of power was strictly applied in the constitution of the United States
of America. Accordingly, legislative power is vested in the congress (the Senate and
the House of Representatives), the executive power is vested in the president and
the power of judiciary is vested in the courts.
The most important purpose of separation of powers is to ward off (keep out) one
branch of a government from involving in the functions of the other. Separation of
power becomes operational in a government of one level. This is why sometimes
called horizontal distribution of powers. On the other hand division of power is
sometimes called as a vertical distribution of powers.
The sum and substance of the whole analysis is that if the three organs of
government are united in the same hands, and then there would be an ―end of
everything‖.
The main purpose of separation of power is the protection of individual liberty
from the arbitrary authority of the state.
Unit Four
Constitution and Constitutionalism
1.1 Meaning of constitution
There are two ways by which we can view a constitution. One is by looking at it as an
‗ethno-cultural arrangement‘ which brings together the way of life of a people. In this
sense, a constitution is concerned with establishing a standard by which a people
judge them selves and their leaders. In another sense, a constitution can be seen as
simply a legal document which defines the power structure and the institutional
sources corresponding to such power structure. In short, Constitution
-is a supreme law of a country,
- is a reflection of the wishes and desires of a nation/people,
- is the basis of the legal relations between a government and its
Citizens,
- sets out the structures and the principal functions of the organs of
Government,
- sets out the rights, duties and obligations of the citizens
1.2. Sources of constitutions
There are many sources which constitutions are made:-
1) Custom:-this is the source of many of the usages of parliament
2) Conventions:-these are established usage-rules that state certain procedures for
doing certain things. Conventions, though very strong in some political systems, do
not involve the application of legal sanctions. One of the basic elements of
conventions is that they are unwritten-they are accepted practice or behaviors.
3) Interpretations given by courts in certain cases involving aspects of a
constitution- judicial decisions-are also sources of constitution.
4) Organic laws: These are laws passed by the legislature that may be
regarded as special.

5) International law:-like the Universal Declaration of Human Rights of

1948 by the General Assembly of the UN as ratified by individual
countries.
6) Text Book Writers: - the opinions of writers of authority. Writers of text
books on constitutions fall into three classes, namely, historians,
political scientists and lawyers.
1.3. Classification of constitutions
Constitutions are either abstract or concrete. An abstract constitution is a system of
laws which determines the structures and powers of the organs of a government as
well as the legal relationship between the state and its citizens.
A concrete constitution is the assemblage of the most significant and fundamental
laws of society enacted in one single document or in a series of documents.
An abstract definition of a constitution is a broader meaning, while the concrete
definition is a narrow meaning.
By form constitutions are classified as written or unwritten-not complied in one
document (statutes, decrees).
Classification by the procedure of amendment:
A constitution may be rigid or flexible. When we say that a constitution is rigid or
flexible, we are referring to how difficult it is to amend. A rigid constitution is more
difficult to amend than a flexible constitution. In a rigid constitution, special
procedures are required to amend it. The normal procedure for passing an ordinary
law is not enough. Such special procedures are stated in the constitution itself.
There are advantages and problems in operating a rigid constitution. The difficult and
slow procedure for amending a rigid constitution helps to guard against the emergence
of a dictator. Much thought and consultation are required to go through amending a
rigid constitution. On the other hand, the slow and difficult procedure required for the
amendment of a rigid constitution makes the constitution unyielding to changing
times. Secondly, there is much reliance on the majority for interpretation. This may
lead to the polarization of the judiciary.
A flexible constitution, like that of Great Britain can be amended the same way a
normal law can (i.e. it can be amended by simple majority). No special procedure is
called for. This gives a flexible constitution the advantage of ensuring that new ideas
and new circumstances are reflected in the amended constitution. In such a
constitution, the chances of generating constitutional conflicts are minimal. The other
side of the coin-that is some of the disadvantages includes possible suppression of
minority views. Haste in amending the constitution may gradually lead to the
emergence of a dictator. The easy procedure for amendment may also lead to
instability and unrest.
Classification by the structure of the state: unitary or federal constitution.

When a constitution stipulates that there must be tiers of government like states,
regions, or provinces, such a constitution is federal. In other words, the functions of
government are shared among more than one tier of government. Where however,

the functions of government are exclusively the responsibility of one level of

government, such a constitution is unitary
A written constitution has the following merits:-
1. A written constitution may guard against the emergence of a dictator;
2. Fundamental provisions of a written constitution are generally considered
seriously before amendments are made;
3. Uncertainties of political life are reduced to the minimum;
4. A written constitution facilitates the study of the fundamental laws of a people;
5. Concrete symbolic values are derivable from a written constitution
At the same time, some of the problems associated with a written constitution are
stated below;
1. To a considerable extent, a written constitution depends on interpretation. It is not
unlikely that such interpretations generate conflicts between two or more arms of
government-legislature, executive and judiciary;
2. There is often times considerable restrictions in the scope of a written constitution
simply because it is not possible to write down all the constitutional laws of a state;
3. Adaptability is another problem. A written constitution is not easily adaptable to
constantly changing circumstances.
When we talk of an unwritten constitution, what we are saying is basically that the
fundamental principles and powers of a government are not written down in any
single document. They can be located in many documents and conventions. The
most obvious advantage of an unwritten constitution is its flexibility. In other
words, it is capable of being adapted to changing situations. A second advantage is
that it may ensure the smooth-running of the government and contribute to the
stability of the state. However, it is difficult to determine when an unwritten aspect
of the constitution is broken. This may give rise to serious consequences on, for
example, the stability of government or even the liberty of individual citizens.
Amending an unwritten constitution gives rise to much flexibility in the process of
doing so. A party in power may amend the constitution contrary to what the
majority of the people want. Finally, in an unwritten constitution, it is difficult to
determine what an established convention is.Opinions is most likely to differ on
such issues.
1.4. Basic features of a constitution
1. Supremacy of the constitution:-All other laws or any of the governmental acts are
subordinate and should conform to the provisions of the constitution. Any irregularity
leads to their being null and void.
2. Briefness of the constitution:-those constitutions do not contain detailed laws, but
general provisions. The details are left to be done by the other branches of law in
consistence with the provisions of the constitution so that they do not contravene the
supremacy of the constitution.
3. Longevity of the constitution: A constitution is framed to serve a long period of
time. It should not be changed now and then to suit temporary expedience of
individuals or groups. Of course, room should be left for its changing when the real
need arises as per its own terms and procedures, as laid down in the constitution itself.
1.5. Purposes and functions of a constitution

The purposes and functions of a constitution are to: define the basic organ of the
government; determine the distribution of governmental powers; establish certain
fixed principles governing the operation of the
government; define the rights and duties of individual citizens, and hold the state
together.
Section Two: Constitutionalism and basic constitutional principles
Section Objectives
At the end of this section you will be able to:
1. Discuss the fundamental constitutional principles;
2. Define constitutionalism; and
3. Identify the relationship between constitution and constitutionalism
Section overview
2.1. Constitutional principles
1) popular sovereignty 5) separation of powers
2) constitutional supremacy 6) judicial independence
3) parliamentary supremacy 7) separation of religion & state
4) rule of law 8) protection of fundamental rights & freedoms
2.2. Constitutionalism
Constitutionalism deals with the rule of law. What this means is that a government
which a constitution sets up should conduct itself in accordance with the rules of
law-that is according to agreed procedures. Any government set up by a constitution
has limits to its powers. Constitutionalism says that not only should these limits be
recognized and accepted by government, the fundamental human rights of the
citizens should also be recognized and guaranteed. Dictatorship and
constitutionalism do not go hand in hand.
Constitutionalism is a modern concept that desires a political order
governed by laws and regulations. It stands for the supremacy of law and not of the
individuals. It limits governments from encroaching on the individual rights. It is a
system of restraints upon government action.
Constitutionalism is a way of dealing with the problem of ensuring that the exercise of
governmental powers should be controlled in order that it should not itself be against
the values it is intended to promote from the very beginning. In other words, it is a
means of making sure that the constitution is respected and obeyed by all citizens and
organs of government regardless of the status they hold. It is about a limited
government and the prevalence of rule of law not of men. An example of this could be
‗no punishment without law‘.
Unit Five
Political participation and Democratic Governance

1.1 What is political participation? Political participation is an action through which

ordinary members of a political system influence or attempt to influence outcomes.
 Political participation is those actions of private citizens by which they seek to
influence or to support government policies. This definition embraces both
conventional and unconventional forms of political participation.
Political participation is a process by which citizens make their voice heard and get
involved in political issues. Political participation might be conducted in different
ways. The most common mode of political participation is voting in elections. In
elections, citizens involve in running for offices, financing campaigns, drafting and
implementing election laws.
Involvement in institution such as political parties and clubs designed to influence

elections and policy-making, or interest groups usually formed to promote specific
public concern is the other mode of political participation. Political participation may
also be accomplished by taking part in political campaigning, demonstration and
petition campaigns that apply pressure to influence the decision-making public
officials.
It is usually when one feels responsible and understands that participation will affect
his/her life directly or indirectly that he/she tries to participate in political process.
Active community participation in political process enables the voice of citizens it be
heard. This has positive effect both on the people and the government. The people
will have the chance to influence decisions of public officials and protect the interest
of the community. If citizens participate in political process and succeed in
influencing the public decisions, the participation will bring remarkable change in the
life of the people.
At the same time, the government will have mechanisms to develop its awareness on
the interest of the citizens. Hence, active community political participation serves as a
bridge between the people and the government.
Citizens‘ participation is vital for the practice of democracy. One of the areas where
citizens in democratic system are expected to participate is in the process of policy
making. The democratic participation of citizens extends to the extent of reflecting
interests in policy process. Citizen‘s participation in framing and evaluating public
policies has many advantages.
Dear student, so far we have seen the definition and areas of political participation.
Having understood the meaning of political participation it is time to explore the
benefits or advantages of political participation.
The following are some of these advantages.

(1). Citizens‟ opinion as means of forming the government. For a democratic
government it is very important to know how the citizens feel and react on various
issues. It will enable the government to shape a policy in the direction that suits the
society, so that it will be more sustainable and productive. In effect, citizens will
benefit from the development of society as they are members of the same.
(2). Citizens‟ opinion as a means of creating different perspectives,

There are diverse ideas and beliefs among citizens of one country. Especially in
counters like Ethiopia where there is diverse cultural and social background, Political
stands and perspectives are expected to be refunded by citizens. It is important then
that citizens from all walks of life participate in the policy making and evaluation
process.
(3). Citizens‟ opinion as a method of creating commitment of citizens

If citizens participate actively in the process of policy making and evaluating,
consensus could be reached to develop sense of ownership and responsibility.
Through this process, citizens will also develop & sense of belonging in the
community.
1.2. Types of political Participation
 Conventional political participation. Example:

- Discussion of politics; to from interest groups; to contact public officials; to
write letters to government officials; contributing money to candidates or
interest groups; to run for office; signing petitions; to campaign for political
parties; to protest government decisions; voting; etc.
 unconventional political participation
- staging sit-down strikes in public buildings,
- chanting slogans out side officials‘ windows,
1.3. Criteria for democratic participation
1. Citizenship 2.Local residence 3.Property 4.Age 5.Sex 6. Literacy
requirement (education) 7.Tax payment 8.Sane citizens (lunatics) 9.convicted
persons having served a long prison sentence often disqualified from voting.
Section Two: Competing concepts of Democracy
1. What is democracy?
Despite the continuing dispute as to its form and content, democracy can be generally
described as a method of organizing government through elections and people‘s
participation, not only in its organizational process, but also in the activities of the
government. Further more it is a system in which people enjoy a certain level of civil
and political liberties.
The Universal declaration of Democracy adopted by the inter-Parliamentary
Union(IPU),the world organization of more than 100 national parliaments, on 16
September 1997 even claims that democracy is
a universally recognized ideals as well as a goal, which is
based on common values shared by peoples throughout the
world community irrespective of cultural, political, social
and economic differences.

Historically, Athens is usually referred as the first city-state that established earliest
forms of democracy. Athenian democracy required the direct participation of citizens
in legislative and judicial functions. The citizenry as a whole formed the key
sovereign body of Athens- the assembly. However, the citizenship was highly
exclusive rather than inclusive, as modern democracy has become. A large part of the
population was prevented from playing a role in the political life of the city-state.
Women, long-term resident aliens (metics) and slaves were denied the right to attend
meetings of the assembly or to serve in public offices.The Athenian democracy
d3eclined with the rise of empires and strong states in the region. The economic
structure that was based on slavery made it vulnerable to internal decay and external
attacks from rival states.
In the middle ages, rulers in European states claimed that God had entrusted them
with the authority to rule the people. The notion of the ‗‘divine right of kings‘‘ was
the political formula that was used by king and princes of those times to secure the
obedience of the population. They attempted to present and use the Bible as the
source of the notion in order to be accepted by their subjects without any question. It
was only at the end of the seventeenth century that the claim of divinity lost ground.
2.2. Types and theories of democracy
Direct Democracy: it is the classical model or the Athenian example of democracy

whereby all members of the group meet to make decisions e.g. in small villages,
towns, municipalities, etc. e.g Referendum, initiative, petition, recall are some
examples.
Indirect (Representative) Democracy: - Democracy through representatives.
There is a growing belief that authoritarianism in the third world served people ill, in
terms of failing to provide material prosperity, stability, order, the protection of
human life, or the pursuit of goals that in any way reflected the wishes of the majority.
Occasional exceptions can be found, such as the rapid rate of economic growth in
Brazil and South Korea and the relatively benign nature of one-party rule in Tanzania.
But the vast majority of third world citizens, whatever their degree of political
influence or perception, have had little reason to favor the continuation of military
governments, single party regimes, or personal rule.
The obvious alternative to authoritarianism is democracy, but democracy is elusive

both as a concept and as a feasible objective. We shall consider feasibility later and
concentrate for the moment on the varied conceptions of democracy, the ideologies
underlying them, and their implications for the state, society, and the citizen. The
classification of the democracies is as old as political science itself, and we have an
embarrassment of typologies to offer the aspiring third world country. For our
purposes, the works of Dodd and Sklar help to illustrate some of the more obviously
relevant types (Dodd 1979: 176-178; sklar 1983: 11-24).After eliminating Dodd‘s
―direct democracy,‖ which is hardly feasible in any but the smallest communities, and
Sklar‘s ―participatory democracy,‖ which seems to overlap with the other categories.
Table 1.1. offers a fivefold classification and summarizes the features of each type of
democracy in terms of objectives, perceptions of society, the role of the state, the
political process, citizen participation, citizens‘ rights, and the actual and potential
problems to which each type gives rise. Each category is, of course, an ideal type, and
most countries claiming to be democracies will contain elements from more than one
category, but we shall begin by looking at each category in its abstract form.

Table 1.1. Types of Democracy

Radical Democracy Guided democracy Liberal Democracy Socialist democracy Consocational
Democracy
Objectives Enabling undifferentiated Achievement of the Representation and Equality; social Consensus between
individuals to exercise their general will protection justice Diverse groups
rights and protect their interests of diverse interests
Perception Aggregation of individuals Organic whole with Aggregation of Potentially organic Aggregation of diver
of society common interests diverse individuals whole but requiring groups autonomous fro
and groups transformation the state
autonomous from the through state action
state
Role of the Executor of the will of the Executor of the Referee Redistribution of Referee
state majority general will resources and guide
to action
Political Provision of arena for pursuit of Unchecked pursuit Checks and balances All citizens given an Recognition of th
process individual interests of objectives to prevent tyranny of equal voice by diversity of interests an
proclaimed by the the majority, or its reducing inequality identities by bringin
ruling elite representatives, or of of wealth and leaders of all majo
powerful minorities resources groups into th
governmental process.
Radical Democracy Guided democracy Liberal Democracy Socialist democracy Convocational

Democracy
Citizen Participation Active participation is Mobilization by ruling elite; Permitted but not actively Popular Participation

encouraged; electoral no elections to key encouraged; electoral participation to within constituent

contestation institutions, or only non contestation offset elite power; groups and by
contested elections may involve group leaders in
mobilization or the allocation of
coercion; electoral resources;
contestation electoral
possible, sometimes contestation
only intra-party.
Citizens‟ rights Individual interests are Individual interests are seen Constitutional safeguards Attitudes to civil Variable; may be
subordinate to the as synonymous with state of individual rights; rights ambiguous; safeguarded by
interests of the majority interests; rulers decide on equality before the law objective of social state or within
but are protected by the extent of equality equality constituent groups
equality before the law
Actual and potential Tyranny of the majority Tyranny of the elite Elite domination on Extent of coercion Reinforcement of
problems account of unequal required to achieve social divisions;
distribution of resources objectives im-mobilism

Radical Democracy
Dodd traces the ancestry of this type of democracy from the ancient Greeks through
Tom Paine and Thomas Jefferson to the utilitarian (Dodd 1979: 176-178). Society is
seen as an aggregation of undifferentiated individuals, without the allowance made in
subsequent literature for the existence of people as members of groups with common
interests and resources that distinguish them from other groups. The democratic ideal
is to enable these undifferentiated individuals to exercise their rights and protect their
interests as active participants in the political arena. Citizens‘ rights are protected to
the extent that all are equal before the law, but there is not same emphasis as in liberal
democracy on protecting the individual against the power of the state, for the will of
the majority is paramount and the state exists to execute the will. Even if the method
of establishing the will of the majority is impeccably democratic, problems remain
with regard to the position of minorities, whether they be permanent minorities such
as a particular ethnic or religious group or more transient groups such as residents
living close to a proposed hydroelectric dam that is purported to be in the public
interest.
The complexity of group interests and the need for governments to retain the support
of these interests in order to survive make this form of democracy unusual in the
modern world. Elements of it may survive in the United States, where political
decisions in many states are taken by referenda, and governments at all levels are
regarded as executors of the popular will rather than means by which corporate
bargains are struck between groups enmeshed in the political process. But in practice,
the sanctions that various groups can wield (including votes) and the checks and
balances written into the constitution prevent a crude majoritarianism. In the third
world, the network of influential groups is generally less extensive, and the
assertiveness of citizens wanting to safeguard their rights against the ―tyranny of the
majority‖ is lower. Some governments have thus been able to claim a mandate from
the majority to pursue radical reforms, even if this meant riding roughshod over the
wishes of minorities or imprisoning subversives who stood in the way. Ghana under
Kwame Nkrumah, Guinea under sekou Toure, or Sri Lanka under successive leaders
might be cited as examples. Yet experience suggests that a country will not
approximate to the radical democratic category for long. The democratic element is
suspect, not only because ―first past the post‖ elections can give extensive power to
rulers who have not received a majority vote but also because the absence of checks
and balances may tempt them to retain power through elections and referenda that are
increasingly unfree, with opposition groups harassed or banned altogether. If
democracy is not to degenerate into authoritarianism in this way, or if people want to
restore democracy after authoritarianism has already been imposed, they may demand
more checks and balances to restrict the power of those claiming to represent the
majority.

Guided Democracy
Guided democracy also borders on authoritarianism and on the people‘s democracies

recently in power in Eastern Europe. Society is perceived as an organic whole with
common interests, unlike the aggregation of undifferentiated individuals in radical
democracy. Leaders claim to know what these interests are (the general will), and the
state exists to execute the general will without being inhibited by constitutional
checks to protect minorities or-as in radical democracy-by majorities who have a false
perception of their real interests. There are, therefore, no individual rights that might
obstruct the execution of the general will, and citizens only enjoy equality, whether
politically or economically, to the extent that their rulers deem this desirable.
One could ask whether the term ―democracy‖ should be used at all to describe such a
system. Yet, unlike totalitarian systems, contested elections are permitted as long as
they do not threaten the power of the executive. Kenya and Tanzania allowed a choice
between parliamentary candidates of the same party, and military movements in
Brazil and Indonesia permitted rival parties to compete for seats in the legislature.
General Ayub Khan openly proclaimed his system in Pakistan to be one of ―basic
democracies,‖ in which competitive elections were held at a local level and provided
the base of a pyramid for the election of higher authorities. (Colonial rule might be
regarded as a form of guided democracy, in which people were not given rights for
which they were not yet considered ready.) Such arrangements may be regarded as
long-tem political solutions that avoid the divisive effects of inter-party competition
or threats to the presidency. Why should Africa follow the Western model when it did
not have the class divisions of the West and did not want a more rigid polarization
along ethnic lines? Why should Pakistan tolerate competition between corrupt party
politicians whose dishonesty and incompetence had been clear for all to see?
Supporters of guided democracies have been more on the defensive in recent years.
Like radical democracies, they can easily degenerate into crude dictatorships, but if
some opportunities for dissent and participation survive, people may question the
legitimacy of those who claim to rule in the public interest without allowing the
public to pass judgment on them through the ballot box. Brazil and much of East and
Central Africa have already moved from guided democracy to a form of democracy in
which the top political offices depend on popular election, though the current rulers of
Pakistan may claim that they preside over a guided democracy.
Both radical and guided democracy therefore exist as ideal types that have a
philosophical clam to be regarded as forms of democracy, but they are not forms to
which politicians or reformers outside a small privileged elite are likely to aspire,
Even in their pure form, they leave the governed with only limited control over the
government, and in their corrupted form they may be little more than a cover for
crude dictatorship.

Liberal Democracy
Liberal Democracy is more willing to recognize society as an aggregation of diverse

citizens acting as both individuals and members of groups. It aims to secure the
representation of these individuals and groups as well as to protect them from other
groups and the state. There is thus a notion of a clearer separation of the state from
society than in radical and guided democracies. The state does not exist to execute the
general will, whose existence is denied on the grounds that people‘s interests conflict
with rather than conform to an organic whole, or the will of the majority, which may
be incompatible with the rights of minorities. Rather, the state exists as a referee to
ensure the representation and protections of diverse interests. Citizens enjoy equality
before the law, but not necessarily social equality, and their rights are protected by
constitutional safeguards, whether enshrined in writing or by convention. Citizen
participation is permitted but not actively encouraged, and the main democratic
emphasis is on representative government chosen through competitive elections rather
than on direct participatory democracy.
A frequent criticism of liberal democracy is that it merely allows political competition

between nominally equal citizens without taking into account the unequal resources
that citizens possess. Elites enjoying superior wealth, contacts, education, or political
skills in general may be able to perpetuate their privileges at the expense of the
majority by manipulating the key political institutions and the media and influencing
public opinion so as to minimize public debate on issues that bring their privileges
into question. This can be seen clearly in many Western countries, where the
wealthier sections of the population are numerically overrepresented in executive and
legislative bodies. Sources of inequality are perpetuated, such as inherited wealth,
private profit from land, and profits from capital that owe more to imperfect markets
than entrepreneurial skill. These are seldom subjects of debate between contenders for
power. Nationalist politicians in the third world who have experienced foreign
exploitation may seek not merely a set of rules to government political competition
but also a means of achieving greater social and economic equality. To them, liberal
democracy may offer an inadequate solution to their perceived injustices.
Socialist Democracy
Socialist democracy is concerned more explicitly with equality and social justice.
Like the advocates of guided democracy, its supporters see society as a potentially
organic whole with common interests, but only after society has been transformed.
This is to be done through the actions of the state, which exists to redistribute
resources, generally through greatly increased public or cooperative ownership and
extensive welfare provision, and to provide a moral guide to political action. The
greater equality of wealth and resources enables the political process to operate
without the built-in advantages that are enjoyed by privileged groups in a liberal
democracy, and the threat of elite power is largely offset by the popular participation
of the masses, though it is not always clear whether this activity is purely voluntary, a
process of mobilization in which social pressure is put on people, or even compulsory
in some instances. Democratic socialists generally insist that they have no objection to
electoral competition, even if they do not treat it with the same enthusiasm as liberal
democrats, but they face a dilemma in deciding how much electoral freedom to give
those who want to restore capitalism. Nicaragua and Tanzania both conceded that
freedom, with the result that their membership in the democratic socialist camp
eventually lapsed.
Socialist democracy‘s attitude toward citizens‘ rights, like its attitude toward electoral
competition, is ambiguous. Its supporters may insist that democratic socialists are as
keen as any liberal to protect the citizen, but if the pursuit of equality and social
justice takes precedence, this may heighten conflicts between the state and the
individual, often to the detriment of the latter. This leads us to one of the central
dilemmas of socialist democracy. How far can the ideals it enshrines be achieved
without considerable coercion? This is not merely a matter of progressive taxation or
the appropriation of private property (possibly with compensation) but also of
policing a variety of activities that might detract from the egalitarian, socially just
ideal. How does one respond to private education or medical care, varied forms of
entrepreneurship, or the importation of goods that upset the government‘s economic
plans? If the material progress necessary for the well being of society is not to be
achieved through the profit motive, what part will state compulsion play in securing
an efficient use of resources? At the extreme, there is even the danger of censorship to
prevent indigenous minorities or foreign publishers from spreading bourgeois values.
Much of this has to be in the conditional tense because countries that can be regarded
as socialist democracies, unlike guided and liberal democracies, are few in number.
Democratic socialists would disown the former people‘s democracies as
undemocratic. They would have doubts about many of the African and Asian leaders
who claim to be socialists but rule over countries in which widespread inequality and
capitalist ownership continue to predominate and in which electoral competition
continues to be restricted. Nicaragua and Tanzania in the 1980s might qualify as
members of the democratic socialist camp, but for the most part, democracy remains
and ideal that has yet to be tested in the real world. The age-old question of how far
the pursuit of equality requires a sacrifice of liberty, or even economic efficiency, has
yet to be resolved.
Consociational Democracy
The term ―consociational democracy‖ was first used in relation to the third world by
Apter to describe the way in which a culturally diverse country such as Nigeria
ensured that all significant groups were incorporated into government without any
being frozen out by a crude majoritarianism (Apter1961:20-28).The system
recognizes society as consisting of these distinctive groups, based on language, race
or religion, and autonomous from one another and the state. The state exists not to
promote any utopian ideal such as socialism, the will of the majority, or the general
will but to act as a referee in the process of inter-group conflict, Although groups
based on social class may blur into each other and there is normally some mobility
between groups, people cannot change their race and only infrequently change their
religion or principal language. The exclusion from power of a social class is thus
seldom total, because people with working-class backgrounds may be recruited into
the elite, or governments with mass bases may be leavened with intellectuals from
higher up the social scale, whereas the exclusion of Catholics in Northern Ireland,
Tamils in Sri Lanka, or Africans in south Africa under apartheid represents a much
sharper break between the ―ins and ―outs.‖ The object of consociational democracy is
to seek consensus between the different groups through a political process that brings
all their leaders into the governmental process, whether through carefully tailored
forms of proportional representation or federalism or by specifically reserving offices
of state for members of the different groups. In these ways, each group will have an
ultimate veto power over the others, though it will normally be retained only as the
ultimate deterrent if the system is to work smoothly.
If the cleavages between the groups are sharp, citizen participation will be mainly
within each group, with the respective leaders then negotiating with each other over
the allocation of resources. Electoral competition is open to all, as in liberal
democracy. Voters may polarize between monolithic groups, but in Europe there are
often divisions within the groups, as between working-class and middle-class
Calvinists or radical and conservative Flemish speakers. In culturally diverse African
states such as Kenya and Nigeria, the divisions within each group are less marked (at
least in terms of voting behavior). Each group has a geographical area in which it
predominates and may gain representation in the legislature proportionate to its size,
even without a formal system of proportional representation. Citizens‘ rights may be
safeguarded specifically by the state, or the state may leave the constituent groups to
fill in much of the detail.
One obvious problem created by consociational democracy is that of immobilism,

with political change moving at the pace of the slowest, and possibly the most
privileged, and with the political system reinforcing cultural divisions that might
otherwise wither away. In rejecting crude majoritarianism, consociationalism may go
to the other extreme of giving minority groups influence (and enabling them to retain
resources) disproportionate to their size, Thus, the solution of consociationalism
canvassed as an answer to South Africa‘s problems might be supported on the
grounds that it is preferable to either violence or a mass exodus of Europeans whose
skills and capital are vital to the economy, but it could still leave the political system a
long way short of ―one vote, one value.‖
There are also practical questions of whether the conditions that have sustained
consociationalism in European countries, such as Belgium, Holland and Switzerland,
are so readily available in the third world. The normally accepted requirements of the
legitimacy of ruling elites-respect for well-established institutions and procedures, a
spirit of compromise, and an overarching sense of national loyalty-may be less

strongly developed in the third world. many elites have lost their legitimacy as a result
of their performance in government, institutions are generally new and ill-developed,
a winner takes-all attitude often prevails over one of compromise, and national
loyalty-though developed in the struggle for independence -is often less deeply rooted
than in European countries that have spent centuries asserting their identities in the
face of hostile neighbors. If the preconditions for consociationalism remain
inadequate, a country may be left with a loose marriage of convenience rather than a
durable form of democracy.
2.3. The Conditions for Democracy

To search for a causal relationship between other developments and democracy,
several explanations of democracy can be offered, as indicated in Table 2.1, each
variable is taken as an entity in itself for the sake of simplicity.

Table 2.1. Conditions Conducive to Democracy

Conditions Arguments Problems
Economic Correlation exists between wealth and Correlation is not the same cause; greater
development democracy; increased national wealth makes wealth may strengthen the resources of
competition for resources less desperate authoritarian rulers; process and rapidity of
economic growth are not specified clearly.
Political attitudes Democracy requires a willingness to accept Attitudes may be shaped by social and
and behaviors government by consent as a means of economic circumstances
resolving conflict.
Inter-elite Democracy emerges when elites agree to the Why is a point reached where national unity
relations rules of the political game rather than risk is preferred to violent conflict or
national disintegration; these rules can disintegration? How can elite attitudes be
subsequently be adapted to accommodate non- ascertained?
elites
Social structures Democracy is most likely to evolve where the How to explain the existence of democracy
and interaction monarchy checks the power of the nobility, and in countries with a diversity of social
between social the aristocracy goes into commerce. antecedents?
groups
Political Democracy requires the development of Danger of historical determinism; role of
institutions institutions ( especially pressure groups and economic changes, external influences, and
political parties) that can filter public demands even society not clear
and thus facilitate compromise
Sequences in Democracy is easier to establish if political Danger of historical determinism; problems
development completion precedes mass participation and if of recognizing and quantifying the variables
major conflicts over the role of the state are

resolved one at a time

External Foreign governments, institutions, or Influence can only be indirect; democracy
influences individuals may supply ideas, offer cannot be imposed
inducements, or apply sanctions

Section Three: Party Politics and Party Systems

Section Objectives
Having gone through this unit, you are expected to:
1. Identify political party systems;
2. Discuss the advantages and disadvantages of party systems;
3. Understand the role and functions of political parties;
4. Classify interest or pressure groups;
5. Describe the functions of pressure groups
Section Overview
3.1. Political party systems
3.2. Meaning, kind and functions of political parties
3.3. The role of political parties
3.4. Political parties and pressure (interest) groups
3.1. Political Party Systems
A political party system consists of all the parties in a particular nation and the laws and
customs that govern their behavior. In his very influential book titled Political
Parties,Duverger points out that the one-party,two-party,and multi-party systems tend to
correspond to the major types of contemporary regimes-dictatorships are characterized by
single party; democracies by either two or multi-party systems. There are three types of party
systems. The two-party system is generally held up as a model form of party system, because
it permits the majority to govern and the minority to criticize. The Multi-party system is
usually considered to less stable but it offers the electorate a wider choice. This is not
necessarily true in every political system,e.g. in the Scandinavian countries, coalitions of
political parties may be as stable as two-party systems elsewhere.
a) The one-party system

This type includes single-party systems and one – party dominant systems. In the former,
there is only one party in the political system, and no political alternative is legally tolerated.
Eg.the former communist party of the Soviet Union.
In single-party systems, there is no competition for elected officials. The only choices left to
voters are (1) to decide whether or not to vote and (2) to vote ―yes‖ or ―no‖ for the
designated candidate. Single party systems characterized communist party governments and
other authoritarian régimes. They have become much less common since communism
collapsed in Eastern Europe and the union of soviet socialist Republic (USSR) between 1989
and 1991.Surviving communist states, most notably China, North Korea, and Cuba, do
continue to enforce the rule of a single party. International financial pressure has also
reduced the number of single party system in developing nations. Funding agencies such as
424
the International Bank of Reconstruction and Development ( known as the World Bank)
often insist upon competitive party systems as a precondition for granting loans or aid to
these countries.
Defenders of single party systems point out that they provide a way for nations to mobilize
and direct the talents and energies of every citizen toward a unified mission or purpose. This
advantage appeals to leaders of some nations that possess limited human and material
resources. However, single party systems limit the political freedom and choices of citizens.
In a one- party-dominant state, a single political party dominates the political process without the
official support of the state. While a number of minor Parties offer political alternatives, the
electorate `usually votes overwhelmingly for the dominant party until the other parties become
consolidates.
b) The Two-party systems. A two-party system exists when two parties are credible contenders
for power and either is capable of winning any election. In a two party system, control of
government power sifts b/n two dominant parties. Two-party systems most frequently develop
when electoral victory requires only a simple plurality vote,
(i.e) the winner gets the most votes, but not necessarily a majority of votes. In such a system, it
makes sense for smaller parties to combine into larger ones or to drop out altogether.
Parliamentary governments in which the legislators are elected by plurality voting to represent
distinct districts may develop party system in which only two parties hold significant numbers of
seats.
Advocates of two-party systems believe they limit the dangers of excessive fragmentation and
government stalemate. However, in the U.S.A. which separates the powers and functions of
government b/n executive, legislative, and judicial branches, it is possible for one party to
control the legislature and the other control the executive branch. This frequently has led to
political gridlock b/n the Republican Party and the Democratic Party.
Opponents of the two party systems believe that in time the two parties increasingly tend to
resemble catch other and leave too many points of view out of the political process. This factor
may alienate voters and lead to low turnout in elections.
c) The multi-party system.
In a multi-party system, three or more political parties have a realistic chance of participating in
government. Multi-party systems are the most common type of party system. Parliamentary
governments based on proportional representation often develop multi-party systems. In this type
of electoral arrangement, the number of legislative seats held by any party depends on the
proportion of votes they received in the most recent election.
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When no party gains a majority of the legislative seats in a parliamentary multi-party system,
several parties may join forces to form a coalition government. Where the parties in a coalition
government hold to principle and refuse to compromise, governments tend to change frequently.
(Eg. France in the 1950s and Italy) .Advocates of multi-party systems Point out that they permit
more points of view to be represented in government and often provide stable enduring systems
of government. Critics note, however, that multi-party systems have sometimes contributed to
fragmentation and political in stability.
Almond and Powell have classified party systems by combining features of competitiveness with
the number of participants and they have come out with this: authoritarian and dominant non-
authoritarian; competitive two-party and competitive multi-party respectively.
Finally, LaPalombara and Weiner claim that the traditional classification between two and multi-
party systems is not sufficiently meaningful. They maintain that the number of political parties in
a political system is not essentially relevant, but competitiveness of parties is very important. On
the basis of this, they came out with a classification that is based on the relationship of political
parties to political development. They suggest the following classification:
(a) hegemonic-ideological;
(b) hegemonic-pragmatic;
(c) turnover-ideological; and turnover-pragmatic.
A hegemonic party is one in which, over an extended period, the same political party or a
coalition/combination of such parties dominate/hold governmental power. A turnover system is
one in which even where there may have been hegemonic periods, there is frequent changes in
the party that governs or in the party that dominates the coalition.
The following are the reasons why the one party tendency was prevalent in Africa:
(i) Colonial legacy of bureaucratic authoritarianism;
(ii) Marxist ideology which was attractive to many early nationalists;
(iii) External threat;
(iv) Cheapness;
(v) Political instability;
(vi) Conformity with the traditional system;
(vii) Traditional preference for a slowly changing status quo;
(viii) Better solidarity to accomplish modernization tasks. If inter-party opposition is allowed, it
may lead to challenges to the system rather than to the regime;
(ix) Provision of avenue for dissent without fear.
Arguments for a Zero Party
Experience of how political parties behaved at different periods in the development of each
country in Africa has led some to argue against the continuation of political parties in African
political systems. For example, in 1896 one of the strongest advocates of zero party said:
Party politics is poisonous. It is the politics of war
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and not of peace; of acrimony and hatred and mud-

Slinging not of love and brotherhood; of anarchy and
discord, not of orderliness and concord; it is politics
of cleavages, divisions and disunity; and not of coope
ration ,consensus and unity; it is the politics of hypocrisy
and charlatanism, not of integrity and patriotism; it is the
politics of rascality not maturity; of blackmail and
near gangsterism, not of constructive honest contribution.
In short, the argument for zero party includes the following:-

(i) Political parties divide the society more;
(ii) Minority governments are encouraged in a party political system;
(iii) Effective government may lack the will to govern due to more emphasis on the politics of
consensus or over concentration on the distribution of the spoils of office;
(iv) Demagogues may be encouraged in a party political system. They whip up public sentiments
for their own ends.
3.2. Meaning, kind and functions of political parties
Political parties are recent institutions in modern political systems. Whether in one-party, two-
party or multi-party political systems political parties may be permanent or they may disappear
very quickly. We may define political parties as organizations that seek to attract support
electorally, of the general public in a political system. They play a direct and substantial role in
political recruitment and are often interested in the capture of political power at local, state, or
federal level of government either alone or in coalition with others. It must be emphasized that
political parties that do not seek to be permanent are not likely to be successfully seek to capture
power. It is therefore important to restrict our definition to those organizations that have certain
major characteristics like:-
 Continuity of organization-in other words, the organization must be meant to span the life
of its current leaders and members;
 Permanence at all levels of government with regular communication between these
levels;
 Consciously seeking to capture political power;
 Constantly seeking new members or supporters.
Political party is any group, however, loosely organized, seeking to elect governmental office
holder under a given label. A classical definition of a political party would note that it is a group
of citizens with in a nation state who are united in their general agreement abut certain basic
ideas with regard to how the society should function. This group organizes itself in order that it
may run candidates for public office under its platform, which consists of a statement of the
basic ideas of agreement. The hope is that these candidates might take over the control of the
government and function in the interest of the majority under the basic outline of the party
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platform. In short, political parties seek to gain control of governments by the political process of
their nation-states. A political party must have some form of organizational structure, some
generally consistent membership who recognizes themselves to be members of the party, and
some kind of regular meeting and discussion so that ideas of consensus can remain consistent
through the party structure.
Functions of Parties
In democratic systems parties perform several important functions that help hold the political
system together and keep it working. Political parties have been classified differently by different
authors, depending on the critical elements each author wants to emphasize. One of the best
known classifications is that of Gabriel Almond and Powell who list three basic functions. These
are: - (i) interest aggregation; (ii) recruitment; and (iii) socialization.
David Apter on the other hand lists the following functions;

(i) transmitting political opinion to government;
(ii) reflecting the socio-political framework of the political system;
(iii) reflecting a microcosm of the future society.
Finally, Lapalombara and Weiner list the following functions;
(i) organize public opinion and communicate demands to the center of governmental power and
decision;
(ii) articulate to its followers the concept and meaning of the broader community;
(iii) involve itself in political recruitment.
We can summarize all these by saying that the functions of political parties include the
following;
(i)A bridge between people and government: political parties are a major ―inputting‖ device,
allowing citizens to get their needs and wishes heard by government. Without parties individuals
would stand alone and ignored by government. By working in or voting for party, citizens can
make an impact on political decisions. At minimum, parties may at least give people the feeling
that they are net utterly powerless, and this belief helps maintain government legitimacy, one
reason even dictatorships have a party.
(ii)Aggregation of interests and opinions: parties help tame and calm interest group conflicts
by aggregating their separate interests into a larger organization. Parties, especially large parties-
are in part coalition of interest groups.
(iii)Integration in to the political system: As the aggregation of interest groups goes on, parties
pull in to the political system groups that had previously been left out. In countries where parties
were unable to integrate workers in to the political system, labor movements turned radical and
some times revolutionary.
(iv) Political socialization; as parties are integrating groups into society, they are also teaching
their members how to play the political game. Parts may introduce citizens to candidates or
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elected officials, giving citizens the feeling that they can make an input, thus deepening their
sense of efficacy within the system.
In party activities, people learn to speak in public, to conduct meetings and compromise and thus
deepening their political competence. Parties are the training grounds for leader with talent. In
fostering individual leadership skills, parties in democratic societies (courtiers) are also building
up among party members a feeling for the legitimacy of the system as a whole.
(v) Mobilization of voters: The most obvious function of parties is getting people to vote. In
campaigning for their candidates, parties are whipping up voter interests and boasting voter
turnout on Election Day. With out party advertisers, many citizens would pay no attention to
election. By simplifying and clarified issues, parties enable voters to choose among complex
alternates.
(vi) Organization of government: The party‘s rewards for victory in an election are the
government jobs and power it uses to try to shift government policy to its way of thinking.
Parties attempt to control government, they don‘t always succeed.
(vii) educate, enlighten and mobilize the populace;
(viii) set goals and values for the society
(ix) Nominate and recruit in to public office
3.3. The role of Political parties
In the political process of a given political system the party is an essential political agency. In an
age when large-scale organized is essential to successful social action it is the organized group
and not the individual usually that carries weight.
―a party is a body of man united for promoting by their joint endeavors the national interests
upon some particular principals in which they are all united‖ Edmund burke.
The first and foremost aim of each political party is to prevail over the others in order to get in to
power or to stay in it. Thus it is for the attainment of political power that parties strive; this
distinguishes parties form other groups in a political system.
The political party in this modern age is a key to political power. All political parties do seek to
gain control over and use political authority by the means open to them in the determination of
the organization operation and goals of a political party. In an open society were broad
consensuses on the basic political structure and the need to maintain an open society exists
political parties do seek to attain the same goals by the same means they compete at a game in
which the rules are more or less commonly agreed up on. Much depends, therefore, upon the
degree to which salty is tolerant of political difference. It totally different ideas exist in a society
each with a consider sale deports-base gross differences in parties will surely crop up and
consequently tolerance will lessen. Were the differences be irreconcilable violence would be the
direct out come leading to the overthrow of the system.
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The capture of political power or its retention can be achieved either with in the existing political
system or by overthrowing it. In a competitive party system parties may present their programs
to the electorate; they may seek to mobilize support of voters through propaganda and
organization. Political parties and interest groups frequently assume the important function of
face-lifting communication between the government and the population. They are known as
―intermediate organization‖ because they are located between the government and the people.
In democracies the main role of parties is to filled candidates for elective office there by
providing voters with a choice among potential government officials. In general parties and
interest groups facilitate the process of political participation.
Generally, parties play the following. roles. These are to:-
1. Provide a structure to rationalize some kind of linkage b/n people and government.
2. Produce a vehicle through which to elect new representatives within the system
3. Create legitimacy for those representatives through the election process,
4. Provide a method for organizing the national and state legislatures into minority and majority
groups.
3.4. Political parties and pressure (interest) groups
Interest Groups
The political process begins with the articulation of demands for action by particular social
groups, usually called interest groups. An interest group is defined most simply as a collection of
individuals who pursue common political goals. It represents people who band together to
accomplish specific objectives. Because interest groups exert political pressure to achieve their
ends, they may also be called pressure groups. Obviously, not all groups are political; people
may organize for any number of reasons. There are social groups such as bridge and dance cubs,
sports clubs, community associations, and professional organizations. Most of these voluntary
organizations will never become involved in politics; how ever, if they do, they become interest
groups in the political process. As such, they facilitate popular participation in politics. By
coordinating political activities, they offer individuals an opportunity to become involved in the
complex process of politics. Politics is an endless cycle because there are always new demand,
generated a variety of interests, with which government must deal.
Interest groups do not seek to control the entire machinery of government; they seek merely to
influence the political process with the goal of achieving certain legislative or policy ends.
Organizations that seek to actually control governments are political parties. Interest groups may
work with political parties and may even become affiliated with them. Generally, however,
parties and interest groups are conceptually distinct, even if their activities sometimes overlap.
The function of a group in politics is to articulate the interest of its members with the goal of
changing laws and influencing public officials. Land developers may try to influence a city
council‘s decisions on planning and zoning; labour unions may try to persuade the provincial
cabinet to amend collective bargaining legislation; conservation organizations may seek to
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influence public policies relating to national or provincial parks. Interest groups also address
themselves to public opinion. In all such cases, citizens with a common goal band together I an
effort to shape legislation that they believe affects their lives.
In the second half of the twentieth century, one of the greater developments in the political
process in western democracies was the proliferation of organized interest groups. Before WWII,
organized interest groups were relatively few in number and consisted chiefly of economic
producer groups with a specific focus; business and industrial associations, labour unions,
farmer‘s associations, and the organized professions, such as doctors, lawyers, and teachers.
Because groups had to operate with whatever resources they could collect from their members,
those representing a well-to-do clientele tended to be the most effective.
The present day picture is radically different. First, there are now vastly greater numbers of
politically active groups. Second, there are politically effective groups representing not only
traditional producers but also diverse consumer interests (consumer associations, environmental
protection groups).as well as a host of moral, cultural, and symbolic causes. Movements arise
and organizations are created in rapid succession; witness the way in which the original ethno-
linguistic liberation movements of the 1960s have been followed feminist, gay liberation, and
animal-rights movements. All have stimulated the growth of organized interest groups that are an
integral part of the contemporary political process.
Many reasons are suggested as causes for interest group proliferation. Here we can mention only
a few actors. One is the expansion of formal education. More people now have the skills required
to run an organization-public speaking, keeping minutes and financial records, doing research on
political issues, writing and submitting briefs to public officials. Another is the ongoing
revolution in transportation and communication, which has dramatically lowered the costs of
building and maintaining a national organization. With the advent of the jet plane, the long-
distance teleconference call, the fax machine, electronic mail and so on, people can now create
organizations that would not have been able to exist many years ago.
Interest groups have become creatures of mass political behaviours .With governments becoming
more involved in all facets of social life; more groups are trying to influence legislation. The
proliferation of interest groups is directly related to the expansion of the state‘s role in the
twentieth century.
Classifications of Interest Groups
Within the scope of this activity, how do we classify interest groups?
There is an attempt to divide interest groups in to two-situational and attitudinal. Under the first
category can be placed all the interest groups which are primarily concerned with the defence
and improvement of the particular situation in to which its members are put. Such interest groups
are non-ideological, specific, and utilitarian in character. An attitudinal interest group. On the
other hand, is primarily ideological, diffuse and somewhat utopian in its outlook. Its motivation
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flows from an idealist view of social welfare and conviction as to how this can be improved. In
brief, such a group is bent on bringing about improvement in society by piecemeal reforms or
sweeping revolutionary changes.
Interest groups can also be described in terms of structural forms in which these interest groups
find expression. The most significant effort in direction has been made by Gabriel Almond who
categorized interest groups into:-anomic, associational, institutional, and non-associational
groups.
1. Anomic Groups:-are spontaneous groups formed by citizens concerned
about specific issues. They usually disband after resolution of the
ingle issue. Demonstrations mobs, riots are good examples of this type
of pressure group.
2. Associational Groups:-are formal organizations set up to articulate the
interests of their members over a long period of time. They are groups to which people
belong out of their free will so as to protect certain interests.
3. Institutional Groups:-organizations closely associated with governments that act internally to
influence public decisions .Example: public service unions, military associations. While people
in these groups are part of governments and in theory politically neutral, they have interests to
articulate and seek specific goals. Like associational groups, they have the advantage of large
memberships, permanent organizations, and continuity.
4. Nonassociational Groups:-Unorganized groups made up of individuals
who perceive a common identity on the bases of culture, race, religion,
or some other distinctive qualities.
Functions of Pressure Groups
1. They serve as important avenues for individuals to realize set objectives;
2. They improve the political education and political consciousness of citizens;
3. They make very important impact on the process through influencing public
policies. By this the quality of decision making improve;
4. They bring together disparate individual interests into a manageable form. This is
what is referred to as interest articulation.
Modes of operations of pressure groups.
Various methods are employed by pressure groups to achieve their objectives. These includes;-
(i) Lobbying;(ii)Manipulation of public opinion;
(iii)Electioneering campaigns ;( iv) Civil disobedience;
(v)Striking and boycotts ;( vi) Public demonstrations;
(vii)Violence
Let us make general observations about the place of interest groups in contemporary liberal
democracies. First, there is a correlation between interest group activity and the guarantee of
political freedom in a society. Without constitutional guarantees of free speech, a free press,
and the right to assemble, the political activities of interest groups would be seriously
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jeopardized. Governments seldom cherish criticism, and a good portion of an interest group‘s
activities involves criticizing proposed or existing laws and policies. Without immunity from
reprisal, there would be considerably less enthusiasm for this type of public participation.
Even in relatively free society governments are sometimes accused of withholding vital
information and even using intimidation.
Second, interest group activity may be good therapy in the participatory society. While all groups
can not achieve all their ends in the political process, most of them are successful at least
occasionally. The theory of group politics suggests in part that successful participation in the
political process through interest group activity reinforces confidence in the system. Group
politics thus has the potential to enhance the legitimacy of the system in the minds of citizens. To
deny groups an opportunity to participate in politics would be to undermine this perceived
legitimacy.
Section Four: Elections and Electoral systems.

Section Objectives
Dear distance learners, upon the completion of this unit, you will be able to;
1. Critically discuss the electoral systems;
2. Identify the strengths and weaknesses of each electoral system
4.1. Electoral systems
The process of electing public officials is central to liberal democracy. Elections provide a way
of changing rulers with out resorting to bloodshed –no small accomplishment in itself, although
hereditary selection has achieved the same thing. More profoundly, competitive political
elections are the basis of democratic legitimacy. The opportunity to participate in choosing rulers
confers on the participants an obligation to obey the laws made by those who are chosen.
Citizens are presumed to consent to laws to the extent that they have participated in choosing the
lawmakers. Disagreement with the substance of lawmakers‘ decisions is not normally sufficient
reason for disobedience, because an opportunity (i.e. another election) will soon arise to vote for
other lawmakers who are willing to alter the disliked rule or policy. Of course, if an elected
government repeatedly ignores the will of most citizens on issues of vital concern, it is likely to
provoke mass demonstrations and even violent protest.
a) The Singe-Member-Plurality System
The single-member-plurality system (SMP), popularly known as first-past the post is familiar
from its use in Britain, Canada, and the United states. One candidate is elected in each
constituency-that is, in each geographical district that has a representative-and each elector has
one vote to cast. The winning candidate is the one who receives a plurality of valid ballots. If
there are only two candidates, the winner automatically gets a majority; but if there are several
candidates who split the vote fairly evenly, the winner‘s plurality may be far less than a majority.
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Plurality systems, otherwise known as 'first-past-the-post, is used for election to the lower
chamber in 43 countries including the United Kingdom, Canada, India, the United States, and
many Commonwealth states. The aim of plurality systems is to create a 'manufactured majority',
that is to exaggerate the share of seats for the leading party in order to produce an effective
working parliamentary majority for the government, while simultaneously penalizing minor
parties, especially those whose support is spatially dispersed. In 'winner take all', the leading
party boosts its legislative base, while the trailing parties get meager rewards. The focus is
effective governance, not representation of all minority views.
The basic system of simple plurality voting in parliamentary general elections is widely familiar:
countries are divided into territorial single-member constituencies; voters within each
constituency cast a single ballot (marked by a X) for one candidate; the candidate with the largest
share of the vote in each seat is returned to office; and in turn the party with an overall majority
of seats forms the government.
One feature of this system is that single-member constituencies are based on the size of the
electorate. Boundaries are reviewed at periodic intervals, based on the census, to equalize the
electorate. Yet the number of electors per constituency varies dramatically cross-nationally.
Under first-past-the-post candidates usually do not need to pass a minimum threshold of votes,
nor do they require an absolute majority to be elected, instead all they need is a simple plurality
i.e. one more vote than their closest rivals. Hence in seats where the vote splits almost equally
three ways, the winning candidate may have only 35% of the vote, while the other contestants
get 34% and 32% respectively. Although two-thirds of voters supported other candidates, the
plurality of votes is decisive.
In this system the party shares of parliamentary seats, not their share of the popular vote, counts
for the formation of government. Government may also be elected without a plurality of votes,
so long as they have a parliamentary majority.
The SMP method is a natural partner to the two-party system because it does not distort electoral
results when there are only two candidates. In that case, a plurality is also a majority, and the
democratic criterion of majority rule is unambiguously satisfied. However, when social
cleavages are such that a two-party system can not be maintained, adhering to SMP can have
peculiar and even distorting consequences.
Another problem with SMP systems is the landslide election. In SMP systems, the distortion
between popular vote and seats is compounded in landslide victories. As a consequence, the
relationship between votes and seats often is very disproportionate. SMP allows only a single
winner and the losing parties get no results for the support they have garnered. SMP penalizes
small parties. The one exception to this relates to parties that are regionally concentrated. It is
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almost a general law of politics that no new party can break into a system based on SMP voting
unless it achieves territorial concentration.
SMP also magnifies relatively small shifts in the popular vote. In a two-party system, an increase
in a party‘s popular vote from 5o to 60 percent of the total will produce a landslide in
parliamentary seats; and if there are three or more competitive parties, anything over 45 percent
for one will probably produce a landslide. Such results may be particularly drastic in multiparty
situations, in which fragmentation of the opposition can give the governing party an artificially
and enormously inflated strength in the elected assembly.
Particularly in ethnically segmented societies, the first-past-the post method can lead to the
permanent under representation of minorities. Thus, the lack of minority representation is a
major criticism of the SMP system of voting. Because of these many difficulties, SMP has been
falling out of favour over the last hundred years. This was originally used quite widely, but
among the world‘s stable industrial democracies it is now only in Great Britain, the United
States, and Canada.
b) The Runoff System
Other systems use alternative mechanisms to ensure that the winning candidate gets an overall
majority of votes. In France the second ballot 'majority-runoff' system is used in elections for the
Presidency. Candidates obtaining an absolute majority of votes (50 percent+) in the first round
are declared elected. If this is not the case a second round is held between the two candidates
who got the highest number of votes.
The runoff system resembles SMP except that the winner must obtain a majority of the votes
cast. If no candidate receives a majority, additional rounds of balloting are held. Trailing
candidates are successively dropped until someone obtains a majority. This system is often used
to choose both candidates and party leaders at conventions in Canada and the United States. The
candidate with the lowest total is dropped after each ballot, and voting continues until someone
gets a majority. All of this ensures that the ultimate winner has a majority of the votes cast on the
final ballot, and this helps to preserve party unity. To have a leader chosen by less than a
majority would be to invite dissention within the party.
c) The Preferential or Alternative Ballot.
Another variation on SMP is the preferential or alternative ballot, which attempts to capture not
only about voters‘ first choices but also about their second, third, and further choices. Electors
are given a form on which they rank candidates in order of preference. If only two candidates are
running, this system operates just like SMP.But when there are three or more candidates, the
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picture changes radically. Voters‘ first choices are tabulated on the first count. If no one has a
majority, the lowest candidate is dropped and a second count is taken. The eliminated
candidate‘s votes are distributed to the other candidates according to the second preferences
expressed on those ballots. The process continues until a majority is reached. The objective of
the preferential ballot is similar to that of a runoff: to ensure that a victor has majority support.
The difference is that the preferential ballot collects the necessary information in advance and
thus dispenses with further rounds of balloting. In a sense, it is a condensed runoff system.
The preferential ballot, like the runoff system, allows parties to retain a separate existence while
forming coalitions with each other offer electoral advantage. In Australia, the Liberal party and
the National party have maintained a working coalition for decades, and together they dominate
the conservative side of the ideological spectrum.
Another majoritarian system is the Alternative Vote which is used in elections to the Australian
House of Representatives and in Ireland for Presidential elections. Australia is divided into 148
single-member constituencies. Instead of a simple 'X', voters rank their preferences among
candidate (1, 2, 3...). To win, candidates need an absolute majority of votes. Where no-one gets
over 50 per cent after first preferences are counted, then the candidate at the bottom of the pile
with the lowest share of the vote is eliminated, and their votes are redistributed amongst the other
candidates.
d) Proportional Representation
Proportional representation (PR) is designed to provide representatives for a broad spectrum of

interests in a constituency. Proportional representation requires multi-member constituencies.
The representation for a constituency reflect not a single majority but a number of minorities (the
actual number depends on the number of representatives to be selected).Representation is
proportional to the vote that the major interests receive in a constituency.
John Stuart Mill was the first important political thinker to popularize proportional
representation. He thought that the first-past –the post system, which was then widely used, gave
too much power to the triumphant majority, which might then abuse the rights of minorities. As
he explained in Considerations on Representative Government, he preferred proportional
representation precisely because it would ensure that various minorities would be represented:
Because the majority ought to prevail over the minority, must the
majority have all the votes, the minority none? Is it necessary that
the minority should not even be heard? In a really equal democracy,
every or any section would be represented, nor disproportionately, but
proportionately.
There are two main forms of proportional representation: the list system and the single-
transferable vote(STV).system (sometimes called the Hare system after its inventor, Thomas
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Hare).Both have the same aim: to ensure that representatives are elected in numbers proportional
to the share of votes that their parties receive in the balloting.
a) The List System
The list system is the easier of the two grasp. The elector votes not for individuals but for parties.
Each party has a list of as many candidates as there are positions to be filled. If a party gets x
percent of the popular vote, then the top x percent of its list is declared elected. This system gives
great power to the party leaders, who in most cases determines the candidates‘ positions on the
list. Being high on the list of a majority party is tantamount to defeat. Barriers are usually
inserted against tiny parties, such as the requirement of a minimum of 5 percent of the popular
vote in order to get any seats at all.
The purest examples of the list system in practice are found in Israel and the Netherlands. In each
case, the entire country is treated as a single constituency and there is a very low threshold
(around 1 percent of the vote) for obtaining representation in the legislature. The result is a
faithful translation of popular vote in to the proportion of parliamentary seats, as a well as a
proliferation of parties and a permanent situation of coalition government. The list system is also
used, with various modifications, in many other European countries, in both the established
democracies of Western Europe and other emerging democracies of Eastern Europe.
b) Single-Transferable-Vote System
The system in this category which continues to be used is the 'Single Transferable Vote' (STV)
currently employed in legislative elections in Ireland, Malta, and the Australian Senate. Each
country is divided into multi-member constituencies which each have about four or five
representatives. Parties put forward as many candidates as they think could win in each
constituency. Voters rank their preferences among candidates (1,2,3,4...). The total number of
votes is counted, and then this total is divided by the number of seats in the constituency to
produce a quota. To be elected, candidates must reach the minimum quota. When the first
preferences are counted, if no candidates reach the quota, then the person with the least votes is
eliminated, and their votes redistributed according to second preferences. This process continues
until all seats are filled.
The single-transferable-vote system (STV) system of proportional representation is better

understood as an extension of the alternative or preferential ballot from single-member to multi-
member constituencies. Electors vote for individuals rather than party lists, but they do so
preferentially; that is, by ranking the candidates in their order of choice. A formula establishes
the quota of votes to win, and the victors‘ surplus votes are transferred according to lower
preferences. The following formula has often been used:
Total number of valid ballots+1/Number of seats+1=Quota
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In a constituency with four seats and 100,000 valid ballots cast, the quota would be calculated as
follows (rounding the quota up because there are no fractional votes):
100,000+1/4+1=20,001
Any candidate receiving 20,001 or more first preferences would be elected immediately. The
remaining position would be filled by counting procedures that take account of second and lower
choices. These procedures are complex, but the basic idea is that votes are transferred both from
below and from above. From below, they are transferred as trailing candidates are dropped. From
above, hay are transferred because, when a candidate reaches the quota, there will usually be a
surplus to be distributed among other candidates. Suffice it to say that STV produces a more or
less proportional result without endowing the party leadership with the extraordinary power
given it by the list system.
Many debates have been held about proportional representation since Mill stated his case. The
main argument for it may be listed as follows:
 Every vote counts; there are no wasted votes, which there inevitably are in the winner-
take-all, first-past-the post system.
 It is a more democratic system, for it ensures minority representation in the precise ratio
of minority votes.
 It is mathematically accurate.
 Every politically active group of any size will, with very few exceptions, have some
representation in the legislature.
 It tempers the domination of political machines.
 It eliminates the evils of gerrymandering because there are no single-member districts to
be gerrymandered.
 It provides greater freedom of choice for voters and thereby raises their interest in the
body politic. Turnout at elections tends to be higher under the various forms of
proportional representation.
The Main argument against proportional representation, on the other hand, can be summed
up in the following way:
 It creates splinter parties; it Balkanizes the party structure.
 It encourages bloc voting and extremism.
 It is divisive; it renders compromise extremely difficult, and may even eliminate it
entirely.
 Majority government-government by a single political party with a majority of seats
in the legislature-is usually impossible to attain; hence, proportional representation
militates against government stability.
 It centralizes control by political parties, by strengthening party machines.
 It is mathematically confusing to the voter.
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 It weakens the intimate contact with the constituency that is possible under single-
member-constituency systems.
Proportional representation in all forms does tend to promote the existence of small
parties, although proliferation of parties can be controlled by using a seat threshold such
as 5 percent employed in Germany and New Zealand. It is not necessary to come
anywhere close to a majority to attract voters, as in a first-past-the post situation. A party
only has to be able to retain the support of its loyalists. Thus, proportional representation
tends to encourage relatively small or medium-sized interest or ideological parties. Such
alignments can be stable over long periods of time, and this can create a distribution of
representatives in the assembly that changes very little from election to election. This is
the cotemporary situation in many European states.
When the distribution of support is stable, and when no single party commands a
majority, the result must be prolonged coalition government. This I itself is not a bad
thing, though it is alien to the British tradition. It can work well, as it has in most
Scandinavian countries; but in cases such as Italy, from the late 1940s until the fall of
communism, when the presence of large extremist parties severely limited the choice of
coalition partners, the result was cabinet instability.
Proportional representation has often been attacked for encouraging the proliferation of
parties, thus, balkanizing politics and making majority governments impossible. The
criticism is not without force. But it is often true that social cleavages exist that will
produce a multi-party system regardless of the electoral method. In these circumstances,
proportional representation is way of keeping civil peace by allowing all significant
minorities to feel represented. A first-past-the post system might extinguish the smaller
parties and leave certain minorities permanently under represented.
4.2. Criterion used to analyze electoral systems
a) Government Effectiveness
For proponents of majoritarian system the most important criteria is government effectiveness.
For admirers, the system of first-past-the-post in parliamentary systems produces the classic
'Westminster model' with the twin virtues of strong but responsive party government. 'Strong' in
this sense means single-party, not coalition, government. Cohesive parties with a majority of
parliamentary seats are able to implement their manifesto policies without the need to engage in
post-election negotiations with coalition partners. The election result is decisive for the outcome.
Cabinet government can pass whatever legislation they feel is necessary during their term of
office, so long as they can carry their own back-benchers with them. Strong government depends
on an exaggerative bias in the electoral system which rewards the winner with a bonus of seats.
A 'manufactured majority' is created by translating a relatively small lead in votes into a larger
lead of seats in parliament. In the postwar period, for example, British governments have
received, on the average, 45 percent of the popular vote but 54 percent of seats. Even in a close
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election, where the major parties were level-pegging, one party has usually been able to form a
government independent of any coalition partners.
b) Responsive and Accountable Government
Yet governments are also seen as 'responsive'. At the end of their tenure in office governments
remain accountable to the electorate, who can throw them out if they so wish. In a competitive
two-party system a small swing in the popular vote is sufficient to bring the opposition into
office. This system can be envisaged as a pulley-and-weights mechanism: a modest pull on the
electoral rope produces a disproportionate displacement of weight. For proponents the twin
virtues mean power is shackled with accountability. Governments are given enough freedom to
carry out unpopular policies, if necessary, during their full term in office and at the end the
electorate can form a clear judgment of their policy record. In addition, at the local level the link
between citizens and their constituency MP is thought to provide citizens with a voice in the
nation's affairs, as well as making elected members accountable to constituency concerns.
Conventional wisdom suggests that there is greater incentive for constituency service in single-
member districts than in large multi-member constituencies.
Responsive governments, and responsive members, depend upon the rate of potential seat
turnover, and delicate two-party equilibrium. If substantial numbers of government back-
benchers have majorities of, say, fewer than 10 per cent over their nearest rival, a relatively
modest swing of the vote could easily bring the opposition into power. Although governments
have a parliamentary majority to take tough and effective decisions, they knew that their power
could easily be withdrawn at the next election. In contrast, proponents argue, in systems with
coalition governments even if the public becomes dissatisfied with particular parties they have
less power to determine their fate. The process of coalition-building after the result, not the
election per se, determines the allocation of seats in Cabinet.
c) Fairness to minor parties
For advocates of majoritarian elections, responsible party government takes precedence over the
inclusion of all parties in strict proportion to their share of the vote. In this view the primary
purpose of general elections is for parliament to function as an indirect electoral college which
produces an effective, stable government. The way that the system penalizes minor parties can be
seen by proponents as a virtue. It prevents fringe groups on the extreme right or left from
acquiring representative legitimacy, thereby avoiding a fragmented parliament full of 'fads and
faddists'. Yet at the same time if the electorate becomes divided between three or four parties
competing nation-wide, the disproportionality of the electoral system becomes far harder to
justify. Smaller parties which consistently come second or third are harshly penalized.
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Rather than majoritarian governments, advocates of proportional systems argue that other
considerations are more important, including the fairness of the outcome for minor parties, and
the representation of minority social groups. For critics of plurality systems, the moral case for
reform is based traditionally on the 'unfairness' to minor parties who achieve a significant share
of the vote, but who win few seats because their support is thinly spread geographically. In
addition, proponents argue, because fewer votes are 'wasted' in a PR system there is a greater
incentive for people to turn out to vote.
d) Social Representation
Demands for change have also been generated in recent decades by increasing concern about the
social composition of parliament. Political systems systematically under-represent certain social
groups in terms of class, race and gender. But within democracies there are substantial variations
in this pattern, and women have usually lagged furthest behind in countries using majoritarian
systems. Parties concerned about this issue have considered various strategies including legally
binding gender-quotas (used in Argentina for the Senate), dual-member constituencies
designated by gender, and most commonly affirmative action in party organizations. But
affirmative action is easiest when applied to balancing the social composition of party lists (for
example, designating every other position on the list for male or female candidates, or balancing
the list by region, occupation, or religion). These mechanisms can also serve other political
minorities based on regional, linguistic, ethnic or religious cleavages, although the effects
depend upon the spatial concentration of such groups.
e) The Consequences of Electoral Systems
A large literature has attempted to examine the impact of alternative electoral systems. The most
important consequences which will be examined here include the election of parties to
parliament, the proportionality of votes to seats, the production of coalition or single-party
governments, the representation of social groups, levels of electoral turnout, and the provision of
constituency services.
f) The Impact on the Party System
One of the most famous claims is that, in a law-like relationship, the plurality rule favors a two-
party system while proportional systems lead to multi-partism. This raises the question of what is
to 'count' as a party, in particular how to count very small parties. We can use the same measure
to extend the analysis to a wider range of democracies including developing and developed
societies, in the most recent election in the mid-1990s. Duverger's law that proportional
representation is associated with multi-partism finds further confirmation from this analysis;
smaller parties can do well under first-past-the-post if their support is spatially concentrated.
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g) The Proportionality of Votes to Seats
The proportionality of election results measures the degree to which the parties' share of seats
corresponds to their share of votes. Previous studies have found this to be significantly greater
under PR than under majoritarian systems. There are a number of ways of measuring
proportionality, which reflect divergent notions of the basic concept. One of the most elegant and
simplest solutions is to measure the largest deviation in the election result, which will generally
be the percentage over-representation of the largest party. As discussed earlier majoritarian
systems provide a winner's bonus for the party in first place, while penalizing others, so this
provides one indication of disproportionality. Hence under majoritarian electoral systems a party
which won 37.5 percent of the vote or more could usually be assured of a parliamentary majority
in seats, whereas under PR systems a party would normally require 46.3 percent of the vote or
more to achieve an equivalent result.
h) The Production of Single-Party or Coalition Governments
The classic argument for majoritarian systems is that they tend to produce stable and responsible
single-party governments, so that the electoral outcome is decisive. In contrast, unless one party
wins a majority of votes, PR is closely associated with coalition cabinets. In countries with PR
and fragmented party systems, like Italy, the Netherlands and Switzerland, all governments tend
to be coalitions. Moreover PR systems may also have single-party governments, such as long
periods of dominance by the Austrian Socialists, the Norwegian Labor party, and the Swedish
Social Democrats. The pattern of government formation is therefore far more complex than any
simple linear relationship might lead us to expect, although as expected there is a significant
relationship between the production of single party governments and majoritarian electoral
systems.
i) The Impact on Electoral Turnout
The standard assumption from previous studies is to expect turnout to be slightly higher in
proportional systems. The reasons are that as a fairer system, since there are no 'wasted votes',
people may be more willing to participate. PR also increases the number of parties and therefore
the choices available to the electorate. Moreover PR makes elections more competitive, so
parties may have greater incentive to try to maximize their support in all constituencies.
j) The Representation of Social Groups
One central virtue of proportional systems is the claim that they are more likely to produce a
parliament which reflects the composition of the electorate. District magnitude is seen as
particularly important in this regard. The main reason is that parties may have an incentive to
produce a 'balanced' ticket to maximize their support where they have to present a party list,
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whereas in contrast there is no such incentive where candidates are selected for single-member
districts. Moreover measures of affirmative action within party recruitment processes can be
implemented more easily in systems with party lists.
Often the choice of electoral system seems mechanistic - constitutional engineering designed to
bring about certain objectives. But the issue of how the electoral system functions has
consequences which reflect essentially contested concepts of representative democracy. For
advocates of responsible party government the most important considerations are that elections
(not the subsequent process of coalition building) should be decisive for the outcome. The
leading party should be empowered to try to implement their programme during their full term of
office, without depending upon the support of minority parties. The governments, and individual
MPs, remain accountable for their actions to the public. And at periodic intervals the electorate
should be allowed to judge their record, and vote for alternative parties accordingly. Minor
parties in third or fourth place are discriminated against for the sake of govern ability. In this
perspective proportional elections can produce indecisive outcomes, unstable regimes,
disproportionate power for minor parties in 'kingmaker' roles, and a lack of clear-cut
accountability and transparency in decision-making.
In contrast proponents of proportional systems argue that the electoral system should promote a
process of conciliation and coalition-building within government. Parties above a minimum
threshold should be included in the legislature in rough proportion to their level of electoral
support. The parties in government should therefore craft policies based on a consensus among
the coalition partners. Moreover the composition of parliament should reflect the main divisions
in the social composition of the electorate, so that all citizens have voices articulating their
interests in the legislature. In this view majoritarian systems over-reward the winner, producing
'an elected dictatorship' where the government can implement its programmes without the need
for consultation and compromise with other parties in parliament. Moreover the unfairness and
disproportionate results of the electoral system outside of two-party contests means that some
voices in the electorate are systematically excluded from representative bodies.
Therefore, there is no single 'best' system: these arguments represent irresolvable value conflicts.
For societies which are driven by deep-rooted ethnic, religious or ethnic divisions, the
proportional system may prove more inclusive, but it may also reinforce rather than ameliorate
these cleavages.
Unit Six
Contemporary Issues: Good Governance, Rule of law and the Question of

Development
1.1. Governance
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The concept of governance is not new. It is as old as human civilization. Simply put governance
means: the process of decision-making and the process by which decisions are implemented (or
not implemented).Governance can be used in several contexts such as corporate governance,
international governance, national governance and local governance. Since governance is the
process of decision-making and the process by which decisions are implemented, an analysis of
governance focuses on the formal and informal actors involved in decision-making and
implementing the decisions made and the formal and informal structures that have been set in
place to arrive at and implement the decision.
Government is one of the actors in governance. Other actors involved in governance vary
depending on the level of government that is under discussion. In rural areas, for example, other
actors may include farmers, cooperatives, NGOs, research institutes, religious leaders, finance
institutions, political parties, and the military etc.The situation in urban areas is much more
complex. Figure 1 provides the interconnections between actors involved in urban governance.
At the national level, in addition to the above actors, media, lobbyists, international donors,
multi-national corporations, etc, may play a role in decision-making or in influencing the
decision-making process.
All actors other than government and the military are grouped together as part of the ―civil
society.‖ In some countries in addition to the civil society, organized crime syndicates also
influence decision-making, particularly in urban areas and at the national level.
Similarly formal government structures are one means by which decisions are arrived at and
implemented. At the national level, informal decision-making structures, such as ―kitchen
cabinets‖ or informal advisors may exist. In urban areas, organized crime syndicates such as the
―land Mafia‖ may influence decision-making. In some rural areas locally powerful families may
make or influence decision-making. Such informal decision-making is often the result of corrupt
practices or leads to corrupt practices.
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Figure 1: Urban actors

1.2. Good Governance
The concept of good governance has been around in both political and academic discovers for a
long time referring in a generic sense, to the task of running a government, however, since the
1980s good governance has become one of the main demonisms of development theory and
practice. The 1989 word Bonk report, ―sub-Saharan Africa; from crisis to sustainable growth‖
reflected this growing concern, while there are slight variations in definitions of good
governance there is general agreement on its gist. For example there is general agreement on it‘s
gist for example
1. In the context of the third word, the world bank‘s view is that good governance must
guarantee human rights, check corruption, and promote democratization as well as
accountability (world bank,1989)
2. for Hyden, good governance is the conscious management of regime structures
3. Dunn looks at good governance in terms of organizational effectiveness. To him good
governance implies a high level of organizational effectiveness.
4. Le Roy, insists that the following factors must prevail one is to talk of good governance:
public accountability, public tolerance of other actors, information openness, and public
management effectiveness
The UNDP (1994) has identified the following seven features of sound (good) governance.
-Legitimacy established through rule based opportunities for charging government,
-Freedom of association and participation,
-Fair and effective legal frameworks and due process,
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-Accountability of public office and service and transparent processes for determining whether
public trust was respected,
-Availability of valid and reliable information,
-Effective and efficient public sector management, and
-Co-operation between government and civil society organizations
The global coalition for Africa considers the following seven generic elements for good
governance:
 Constitutional arrangements and human rights,
 Predictability of the law /primacy of legality,
 Responsibility of government
 Coherence of administrative institutions,
 Openness /tolerance of the political system,
 Participation /communication, and
 Favorable climate for the private sector,
The interpretation of the concept of good governance differs between development agencies. For
instance the WB and the IMF stresses the importance of sound macro economic policies and the
fight against corruption, while some bilateral donors and NGOS put more emphasis on
democratization and human rights,
The World Bank defined governance as the ―manner in which power is exercised in the
management of a country‘s economic and social resources for development‖ (World Bank,
1993).
The Bank distinguishes three distinct elements in good governance, namely: the form of political
régime, the process by which the authority is exercised in management of a country‘s economic
and social resources for development, and, the capacity of government to design, formulate and
implement policies and discharge functions.
In many countries, the WB governance agenda focused on civil service reform. There has also
been significant concern with the need to promote decentralization and building the capacity of
local governments.
Despite the efforts of various agencies to define good governance, the overall picture is good
governance covers a wide range of policy objectives; more efficient market functioning, stronger
civil society, more democracy and human rights and effective government.
Good governance has 8 major characteristics. It is participatory, consensus oriented, accountable,
transparent, responsive, effective and efficient, equitable and inclucive, and follows the rule of
law. It assures that corruption is minimized, the views of minorities are taken in to account and
that the voices of the most vulnerable in society are heard in decision-making. It is also
responsive to the present and future needs of society.
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ConConsensus
AccAccountability
oriented
ountability
TraTransparency
ParParticipation
(Openness)
GooGood
Governance ResResponsi
RulRule of Law
veness
e of Law
Effectiveness and EquEquitability

Efficiency inclusiveness
Figure 2; Characteristics of good governance
Participation
Participation by both men and women is a key cornerstone of good governance. Participation
could be either direct or through legitimate intermediate institutions or representatives. It is
important to point out that representative democracy does not necessarily mean that the concerns
of the most vulnerable in society would be taken into consideration in decision-making.
Participation needs to be informed and organized. This means freedom of association and
expression on the one hand and an organized civil society on the other hand.
Rule of law
Good governance requires fair legal frameworks that are enforced impartially. It also requires
full protection of human rights, particularly those of minorities. Impartial enforcement of laws
requires an independent judiciary and an impartial and incorruptible police force.
Transparency
Transparency means that decisions taken and their enforcement are done in a manner that
follows rules and regulations. It also means that information is freely available and directly
accessible to those who will be affected by such decisions and their enforcement. It also means
that enough information is provided and that it is provided in easily understandable forms and
media.
Responsiveness
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Good governance requires that institutions and processes try to serve all stakeholders within a
reasonable timeframe.
Consensus oriented
There are several actors and as many view points in a given society. Good governance requires
mediation of the different interests in society to reach a broad consensus in society on what is in
the best interest of the whole community and how this can be achieved. It also requires a broad
and long-term perspective on what is needed for sustainable human development and how to
achieve such development. This can only be result from an understanding of the historical,
cultural and social contexts of a given society or community.
Equity and inclusiveness
A society‘s well being depends on ensuring that all its members feel that they have a stake in it
and do not feel excluded from the mainstream of society. This requires all groups, but
particularly the most vulnerable, have opportunities to improve or maintain their well being.
Effectiveness and efficiency
Good governance means that processes and institutions produce results that meet the needs of
society while making the best use of resources at their disposal. The concept of efficiency in the
context of good governance also covers the sustainable use natural resources and the protection
of the environment.
Accountability
Accountability is a key requirement of good governance. Not only governmental institutions but
also the private sector and civil society organizations must be accountable to the public and to
their institutional stakeholders. Who is accountable to who varies depending on whether
decisions or actions taken are internal or external to an organization or institution. In general an
organization is accountable to those who will be affected by its decisions or actions.
Accountability can not be enforced without transparency and the rule of law.
In general, the following shopping lists constitute good governance:-
 a strong and participatory civil society
 an open and predictable policy-making process
 a transparent and accountable executive,
 a professional bureaucracy and developmental state; watchdog institutions
(ombudsman, human rights commission)
 rule of law and respect of human rights;
 a broad reform strategy and a set of initiatives to strengthen the institutions of civil
society and democracy
 free media (competitive)
 regular, fair and free elections;
 poverty alleviation /reduction or elimination
 freedom of speech and association;
 an independent judiciary (impartial tribunal)
 conducive environment for Foreign Direct Investment, (FDI)
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 Tolerance and respect of differences (cultural, political….)

1.3. The Rule of Law
The rule of law is a cornerstone of the concept of human rights and democracy. There is however
no international consensus on its meaning.
The rule of law implies that right must be protected by law, independently of the will of the ruler.
Individual rights and freedoms are to be protected against any manifestation of arbitrary power
by public authorities. The rule of law is more than the formal use of legal instruments; it is also
the rule of justice and of protection for all members of society against excessive governmental
power. In sum the rule of law means that law shall condition a government‘s exercise of power
and those subjects or citizens are not to be exposed to the arbitrary will of their rulers.
The meaning of the rule of law, since its rise in the early middle ages, has gone through a process
of change, which runs roughly parallel to evolving views on the role and objectives of a national
development. But it is a dynamic concept not only in this respect. It does not stand for on
abstract, unchanging set of unambiguous rules, but rather for a range of principles which have to
be applied and developed on a case-by-case basis. The rule should thus be seen as a whole set of
legal standards by which governments and subjects are bound. The exact content of these
standards is determined by several factors, including public opinion; political consciousness and
the prevailing sense of justice.
The fact that the rule of law is constantly changing does not mean that guidelines can not be
distilled from it. On the contrary, it is, to some extent, possible to identify the rules and
principles that follow from the rule of law at a certain point in time. Basically, some principles
have been part of the rule of law right from is origin. These are principles of a universal nature,
which have defied change. Some of the most important one are the following
1. No one may be punished except for a distinct breach of an existing law established in the
ordinary legal manner before the ordinary works of the country.
2. All individuals are innocent until proven otherwise (presumption of innocence)
3. Every human being should be treated equally by the same courts, and should have the same
rights. This equality is not absolute, since certain professional groups, such as the military,
lawyers and civil servants are sometime judged in their professional quality by special courts.
This practice is not contrary to the rule of law; within these groups equality before the law
applies to the full.
Other rules and principles derived from the rule of law are;
1. No arbitrary power. This principle includes the separation of powers. It does not only apply
in relations between the legislature, the executive and the judiciary. As the state regulates
national life in many ways, discretionary authority is inevitable. yet, this does not mean pure
arbitrary power i.e. power exercised by agents responsible to no one and subject to no control.
The way power and authority are delegated to lower state institutions has to be controlled and the
way those institutions use their power has to be accounted.
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2. Independence of the judiciary. Independent of the judiciary implies the control of

administration of justice by an independent judiciary and the independence of the legal
profession. Fundamental rights and freedoms can best be guaranteed in a society where the
judiciary and the legal professions enjoy freedom from interference and pressure, and where
every person is entitled to a fair and public hearing by a competent, independent and impartial
tribunal.
The rule of law has come to be regarded as the symbol of a truly free society. Although it‘s
precise meaning differs from country to country and from one epoch to another it is always
identified with the liberty of the individual. The rule of law aims to maintain a delicate balance
between the opposite notions of individual liberty and public order. Every state has to face the
challenge of reconciling human rights with the requirements of public interest. This can only be
accomplished through independent court; entitled to guard the balance between the citizen and
the state.
The most powerful entity in any community, and hence the greatest potential violator of human
rights is the state, through its public authorities, its officials and agents. Any democratic society
needs laws to protect the rights and freedoms of individuals as laid by in constitutions. There
should be laws enabling individuals to obtain a remedy for any violation, and there should be a
legal system that ensures that those remedies will be enforced especially against the state itself.
The rule of law means that the exercise of government shall be conditioned by law and that the
citizens shall not be exposed to the arbitrary will and whims of the ruler. This principle is an
intrinsic part of the principle of the supremacy of the constitution. Supremacy of the constitution
emanates from the rule of law. The understanding of the rule of law as a pillar of a democratic
society can be revealed in the following meanings:-
1. it means the equality of citizens before the law. All persons are equal before the law and are
entitled to the equal protection of the law without any prejudice to his sex, race, nation,
nationality, color, language, religion, etc. The law is one and the same for all and is applied
without discrimination.
2. Rule of law limits the authority of government and its officials. The rule within the rule of law
is ―no man is above the law.‖
One basic principle of rule of law is judicial protection of individual rights from arbitrary
encroachment of government power. Judicial protection refers to the protection made by the
courts on the individual rights. Individual rights are guaranteed by the constitution and
international conventions. The judiciary protects individual rights mainly through the process of
due process of law.
Due process of law can be defined as a principle of constitutional law which protects liberty and
property of a person. The protection is against unreasonable laws or arbitrary intervention of any
governmental body.
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Elements in the principles of due process of law: habeas corpus, -

presumption of innocence: right against self discrimination, adequate notice and opportunity to
be heard, an impartial tribunal (courts),speedy and public trial, right of appeal, right to counsel
and protection against double jeopardy.
Activity: 1. Identify and critically examine the incorporation of the principles of rule of law and
due process of law in the constitutions of 1931, 1955, 1987, and 1995 in Ethiopia?
Section Two: The Concept of Economic Growth and economic development
Section objectives
Section Overview
2.1. Development
2.2. Values of development
2.1. Development
Dear student, as we have put earlier this is an introductory course designed to acquaint students
with some important concepts in the field. In this context, we will not discuss the major theories
of economic development and identify the possible way forward for developing countries like
Ethiopia. Next year, you will have a course on development theories and principles.
The idea of development has an old back ground. However, the modern sense of the term has
come about only after WW II. Two great historical conditions (transformations) contributed for
the emergence of the concept of development. These are:
1. The process of decolonization and political independence
2. The emergence of socialism and capitalism as opposing ideologies
Scholars never came to agreement as what development entails (mean). However, development
broadly means the improvement of people‘s life style through improved education, better
incomes, skill development and employment.
What is the difference between Economic growth and economic development?

Economic growth is a rise in the national income. I.e. when the per capita of a country grows.
GNP/No. POP = PCI. Economic development is a rise in per capita income plus fundamental
change in the structure of the country. The two most important change of structure are;-
a) The rising share of industry along with the falling share of agriculture in national
product and
b) An increasing % of population who live in urban areas rather than in the country
side.
A key element of economic development is that people of the country must be major
participants in the process brought about these changes in the structure. Development prior to
the1970s was seen as an economic phenomenon in which a rapid growth in economic growth
which ―trickledown‖ to the mass of the people through the form of jobs, and other economic
opportunities. The problem of poverty, unemployment and income distribution were given
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second importance.But, as we have seen, development has broader meaning. It has a multi
dimensional meaning. The challenge of development is to improve the quality of life which
includes better education, health and nutrition, less poverty, clean environment , more equality of
opportunities and greater individual freedom and richer cultural life.
2.2. Values of development
Life-sustenance (the ability of meet basic needs (the basic needs approach to development by
WB), Self-esteem (is concerned with the feeling of self respect and independence of oppression),
Freedom of choice (freedom from servitude) is to be able to choose. This refers to freedom
from three evils of: want ignorance and taboos, or squalor so that people are more able to
determine their destiny.
Development has the following objectives. These are:
1. To increase the availability and the distribution of basic life sustaining goods such as
food, shelter, health, education and protection.
2. To raise the level of living including the provision of more jobs , better education,
greater attention to cultural and humanistic value all of which will not only enhance
material well being, but also to generate individual and natural self-esteem.
3. to expand the range of economic and social choices available to individuals and nations
by freeing them from servitude and dependence not only in relation to other people and
.states, but also to forces of ignorance and human misery.
The famous researcher Dudley Seers says the question to ask about a country‘s s development
are;-
 What has been happening to poverty?
 What has been happening to unemployment?
 What has been happening to inequality?
If all three of these have declined from high level then, beyond doubt this has been a period of
development for the country concerned. If problems have been growing worse, especially if all
three have it would be strange to call the result development, even if Per Capita Income doubled.
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COURSE 8: POLITICAL THOUGHT II
Unit One:
Machiavelli‟s Political Realism

Unit Contents Section Two: Unique Qualities of a Prince
Section One: The Prince and the Art of 2.1. The Analogy of the Fox and Lion
Politics
2.2. The Issue of Keeping Faith with the
1.1. The Prince People
1.2. The Art of Politics 2.3. To be Loved or Feared?
1.3. Morality, Religion, Virtue and Political 2.4. The Issue of Becoming Cruel or
Power Merciful
1.1. The Prince
Q: Who was Niccolo Machiavelli? Why Machiavelli was nicknamed ―Old Nick‖ (Devil)?
• Niccolo Machiavelli, an Italian renaissance philosopher, born in the Republic of Florence

on 3 May 1469, became prominent in political philosophy.
• He practiced the art of politics as a diplomat in which he served the Florentine republic as
a representative in Germany, France and the Holy Sea
• Known as the father of the ideology of ‗political realism‘ and secular politics
• His unequivocal/explicit support for worldly political power regardless of all other values
earned him a nickname ―Old Nick‖ (Devil).
• When the republic of Florence became an absolutist state under a dictator (Lorenezo di
Medici) in 1512, as a former official of the old regime, the new regime imprisoned and
tortured him.
• Machiavelli lost his job in the new regime and turned his attention to writing on politics.
Then, he went to the countryside and wrote his most popular treatise on government
entitled The Prince.
Q: What is Prince? What is political realism?
• The Prince is a short handbook of ruthless dictatorship and political cunning that lays out
methods to acquire, preserve and expand political power
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• The book concerns itself with how to acquire, preserve and expand political power
promoting a doctrine of political realism i.e. the maximization of power by any means.
• The book is a very practical one because it draws historical experiences from previous
political rulers.
• The Prince is the most-widely read books throughout the world.
Q: What makes his book the most revolutionary one?
• The most revolutionary aspect of the book is not what it consists but what it ignores.
• From Plato through the Middle Ages to the present age, the main theme of political
philosophy was the end purpose of the state.
• Contrary to traditional belief, he argued that political power was not a means but an end
in itself. By doing so, he focused on the means to acquire, preserve and expand political
power.
1.2. The Art of Politics
Q: What is ―Art of politics‖ mean? What is politics for Machiavelli?
• The art of politics refers to the skills in getting and managing political power and take
public authoritative decisions.
• As politics is a science, it is also an art which requires natural talents to make conscious
and rational decisions in a pragmatic way.
• These talents are important to deal with complex behaviors of human beings, who are the
main actors in politics.
• Machiavelli‘s view of politics is negative. He argues that politics is full of intrigues and
deceptions.
• In fact, like most philosophers, his philosophy emanates from his pessimistic view of
human nature.
Q: How does Machiavelli characterize human nature? Does politics determine human nature?
• His pessimistic view emphasizes that people are naturally greedy, selfish, petty,
dissatisfied and disloyal.
• He insists that people have no hope of redemption and are naturally jealous, vain, proud,
fickle and stupid.
• Human beings, he believed, have unlimited wants and have no means of satisfying them.
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• As a result, he argued, people become continually frustrated and resentful.
• Naturally, their resentment and dissatisfaction targets political rulers whom they expect to
make them happy.
• They never stop blaming prominent people and those on political power when they do not
get what they seek.
1.3. Morality, Religion, Virtue and Political Power
Q: How does Machiavelli perceive morality, virtue and religion? What is their role in the
political realism?
• He regards the state as an autonomous system of value independent of other

sources.
• Thus, he maintained the view that a ruler can violate other value system such as
moral, ethical and religious considerations for the sake of political power.
• His approach to the exercise of political power is amoral.
• This does not mean that Machiavelli denies the existence of other value systems
such as religion and morality.
• Neither does he argue that people should avoid these value systems in their
private lives.
• He accepts that the moralist will give primacy to his moral code and a religious
person will do the same to his religious code.
Q: Why Machiavelli maintained such view?
• According to Machiavelli, the means and ends of each of them are different because what
is bad in religion and morality may be good in politics in as far as it assists the prince in
achieving his end: acquiring, preserving and expanding political power.
• What he argues is simply that there are no moral bases whatsoever to judge any
difference between legitimate and illegitimate actions.
• Fore instance, Machiavelli justifies the use of poison by a prince to eliminate his/her
political opponents. Yet, he does not believe that the use of poison is generally good; it is
good only when it advances the political interest of a prince in fulfilling his end.
• Machiavelli justifies this political realism with the statement that other peoples‘ evil
requires us to treat them badly.
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• According to Machiavelli, neither morality nor religion serves as a basis for political
decisions.
• Only the reason of the state serves as a basis.
• Hence, he argues,
• Where the safety of the state depends on the resolution to be taken, no consideration of
justice or injustice; humanity or cruelty; glory or shame are allowed to prevail. But
putting all other considerations aside, the only question should be: what course will save
the life and liberty of the country?
• The reason of state is a determining code for a prince.
• By doing so, Machiavelli changed the position of good and bad from absolute to that of
relative position.
• When it comes to political power all other virtues and values are subordinate to
acquiring, preserving and expanding power.
• So, in a nut shell, his arguments in favor of the acquisition, preservation and expansion of
political power rests on one major theme: the end justifies the means.
Q: What is the most important virtue for a prince?
• He argued virtue is all about military valor/courage that a prince should practice during
warfare and political crisis situations.
• He is of the view that a prince should have good understanding of reality and ability to
adapt his actions to reality. Moreover, a prince should shift positions in a pragmatic way
as fortune and circumstances dictate.
• So, in Machiavellian interpretation, the most important virtue of a prince is that of

prudence.
• In politics, Machiavelli believes, the term goodness simply refers to efficiency, i.e.
efficient means of acquiring, preserving and expanding political power.
• He thus replaces the idea of virtue and vice in morality and religion with that of
efficiency and inefficiency in politics.
Q: Why did Machiavelli criticized religion?
• Machiavelli did not have any sense of religion. He criticized Christianity because it
glorifies humility and lowliness.
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• Moreover, he insisted that Christianity has contempt/dislike for worldly objects and
favors humble men rather than men of action.
• He also attacked the Catholic Church because of its failure to unite and rule Italy, which
was at the time highly disunited.
• He had expectation that the Pope would unite Italy because the Catholic Church had
jurisdiction over most of the country.
• Machiavelli was very much angry about the disunity of his country.
Q: Does religion have any role for a Machiavellian prince? If so, what?
• Yet he advises princes to seem to be religious if it serves as a tool of political influence.

But, he insists that princes should not be too religious.
• If a prince becomes religious, Machiavelli argues, he cannot take actions that are contrary
to religion.
• But, seeming to be religious gives the ruler the opportunity to be pragmatic in taking
political actions.
• Yet Machiavelli does not deny the political importance of religion for rulers. He
maintains that religion keeps people well-disciplined and united.
• Machiavelli notes that the unity and discipline of the people gives the ruler an
opportunity to rule his subjects without much difficulty.
• For political purposes, the prince should spread false religious dogmas and beliefs.
Section Two: Unique Qualities of a Prince
Q: What do you know about the peculiar characteristics of a fox and a lion? And what do you
think is their relevance for a Machiavellian prince?
• Machiavelli maintains that a prince must apply two methods of fighting and rule; namely,
by law and by force.
• Rule by law belongs to the rule of man while rule by force to that of beasts.
• Ruling by law, he states, is insufficient because of the peculiarities of human nature.
• A ruler must use rule by force, too. When a ruler rules as a beast, Machiavelli brings the
behavior and talent of two animals, namely, fox and lion, as an example.
• As you can understand, lion is the strongest animal on earth.
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• A lion can defend itself from other animals and can strike severe attack against its
enemies.
• Machiavelli insists that when a prince imitates a lion, he will be in a position to strike
terror and fear into his political opponents.
• But, a lion cannot recognize traps and tricks and it falls into them easily and become a
victim.
• Hence, a prince must also imitate a fox, a weak and small animal, which easily
recognizes and avoids traps and tricks. Imitating a fox, therefore, helps a ruler to
recognize and avoid political tricks that his enemies prepare against him.
The Issue of Keeping Faith with the People
Q: What is the advice of Machiavelli for Princes about keeping faith with people?
• Machiavelli argues that keeping faith and promises to people may be an admirable thing
to do.
• However, he insists that it is usually irreconcilable with the political interest of rulers.
• He maintains, ―A prudent ruler ought not to keep faith when it is against his interests and
when the reasons that bind him no longer exist‘‘.
• ‗‘Men are bad and would not observe their faith with you. So you should not be bound to
keep faith with them.‖
• You can understand that this advice is based on his view of human nature explained to
you earlier.
• In fact, a prince, when he finds it necessary, should seem to have qualities such as faith
and mercy rather than naturally possessing and observing them.
• When a ruler seems to have these and other qualities, Machiavelli argues, he can adopt
opposite qualities when it deems necessary.
Q: Should the Prince be loved or feared? Why?
 Machiavelli recognizes that a prince should be feared and loved.
 However, he denies the possibility of being loved and feared simultaneously by the
people.
 So when a ruler makes a choice, Machiavelli insists, he should choose to be feared rather
than loved by the people.
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 He advices a prince not to trust the people.
 If he does so, Machiavelli warns, he has ruined his political power.
 Machiavelli‘s reason is simple, i.e. the love of the people for their ruler is a matter of
their free will, which they can abandon at any time.
 The issue of loving or not loving a prince is in the hands of the people. It is a bond of
obligation which man, the miserable creature, breaks when it fits him to do so.
• But a prince can maintain fear on his people by his own methods.
Q: What are these methods?
• A ruler can create fear by force and dread of punishment.
• Creating fear is completely in under his control. He is of the view that people obey only
because they fear the consequences of disobeying.
• In fact, he does not deny that it would be nice to govern gently from the love of one‘s
subjects.
• But because people are easily offended and unreliable, the successful Prince must instill
a degree of fear in the people to gain respect and obedience.
• Machiavelli draws distinction between not to be loved and to be hated by the people.
• Even if the people do not love the prince, Machiavelli advises, he must still try to avoid
hatred by the people because fear and absence of hatred can go together.
• If the people have hated their prince, then, Machiavelli insists, the prince must realize
that his political power is in danger
Q: How can a prince avoid fear by his people?
• Yet a prince can avoid fear only when he
*Abstains from interfering in private property of his subjects
*Abstains from interfering in the wives of his subjects.
• According to Machiavelli, a ruler should not confiscate the private property of his
subjects because, he argues, men value their property very much.
• This position of Machiavelli implies that he is a defender of the right to private property,
which the state should respect.
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• Interestingly, he also argues that people sacrifice their lives for the sake of defending
their women.
The Issue of Becoming Cruel or Merciful
Q: As advised by Machiavelli, need the prince be cruel or merciful? Why?
• Machiavelli advises political rulers to become cruel when he deems it necessary.
• He states, ―It is better to be cruel and maintain the state instead of becoming merciful and
allow disorder to exist.
• The first ruler injures individuals but the latter injures the community as a whole.‖
• But, he argues temperance is necessary for a prince because a prince should not be cruel
simply for its own sake.
• He advises a prince that there is no need to be unnecessarily arrogant because, ―to incur
hatred without an advantage is the greatest imprudence.‖
• In other words, a ruler should be merciful when it is necessary.
• He also states that ruling with threats and insults especially against foreign enemies is
dangerous because it will make enemies cautious of the future intentions of the prince.
• But it is better, he insists, to imprison or kill enemies or opponents who conspire against a
prince‘s political power.
Q: Why Machiavelli insisted the prince to kill or imprison those who conspire against him?
• Firstly, the conspirators (opponents) will not have any opportunity to attempt a similar
conspiracy in the future.
• Secondly, the action will deter any future attempt by other opponents against the prince.
• Thirdly, if there is any ongoing conspiracy, which is hidden from the ruler, conspirators
will stop it prematurely because of the fear that the prince will take similar punishment
against them if he knows their conspiracy.
Q: What are advices of Machiavelli to a Prince?
 building a strong army with good arms and making friends (often, if one has good arms,
he can have good friends, too)
 he should fear anyone in the country (the most dangerous enemy is internal one)
 Avoid hatred
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 address all grievances and dissatisfactions of his people
• Rigging elections;
• Appealing to a country‘s origins and past traditions;
• Employing religion to gain reverence/respect for the state
• Using other officials to carry out unpopular policies and then destroying them.
Q: Why do you think a number of western literatures characterize Emperor Haile Selassie I of
Ethiopia as a ―black Machiavelli‖?
Unit Two:
Social Contract Theory

Unit Contents 2.1. Lock‘s State of Nature Theory
Section One: Thomas Hobbes‘ Political 2.2. Natural Rights and Ownership of
Thought Private Property
1.1. The Socio-Political Background to 2.3. Lock‘s Theory of Consent and Political
Hobbes‘ Political Philosophy Power
1.2. Human Nature and State of Nature 2.4. The Nature of Government
1.3. Social Contract 2.5. Disobedience and Revolution
1.4. Powers of the Sovereign Section 3: Jean-Jacques Rousseau and the

Idea of the General Will
1.5. Forms of Government
3.1. Social Contract
1.6. Is the Hobbesian State a Totalitarian?
3.2. Rousseau‘s General Will
Section 2: John Lock‘s Social Contract and
Natural Right Theory 3.3. Rousseau‘s Legitimate Government
Section One: Thomas Hobbes‟ Political Thought
1.1. The Socio-Political Background to Hobbes‟ Political Philosophy
Q: Who was Thomas Hobbes? Thomas Hobbes (1588-1679), a graduate of Oxford University,
is an English philosopher and a founder of British liberalism.
• The modern liberal concepts of rights, individualism, liberty, consent and social contract
began with Hobbes‘ philosophy.
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• His philosophy finds its root in the socio-economic and political background of England
in 1640s.
Q: Why he developed the theory of absolute government?
– He lived in a politically tumultuous epoch.
– In a few decades, the English monarch‘s mastery over its own realm had been
shaken due to two major civil wars caused by socio-economic and political issues.
– Thus, it was natural for Hobbes to develop his theory of absolute government.
– What his country needed at the time was a strong government that would
maintain law and order.
– Hobbes‘s experience of the disorder of the English civil wars led him to fear
freedom and anarchy.
Q: What is the „Leviathan‘ about?
- Hobbes wrote a book entitled, Leviathan, in 1651, which contains his political
philosophy.
- In Leviathan, Hobbes sets out his doctrine of the foundation of societies and
legitimate governments.
- It became one of the first scholarly works on social contract theory.
- The book‘s ominous tone reflected the horrors of the civil war that had just ended.
- Civil war is humanity‘s natural condition, Hobbes warns us.
- In trying to imagine what society must have been like in a so-called ―state of
nature,‖ before there were any governments, Hobbes conjured up the image of
permanent warfare.
- In writing this book, Hobbes‘ main premise was that all major philosophers
before him had failed to lead people towards peace and security.
- Hence, he claimed that he had a civilizing mission for the whole human race.
- The main intention of the book was, therefore, to contribute to the establishment
of peace and ensure amity and enable men to fulfill civic duty.
Human Nature and State of Nature
Q: How does Hobbes define human nature?
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• Hobbes holds the view that man is essentially selfish.
• Man‘s appetites, desires and passions, not intellect or reason, dictate his actions.
• As a materialist, Hobbes looks at human nature and society from a scientific and
biological perspective.
• For Hobbes, people are just like everything else in the universe. He applies scientific
methods to humans through their physical sense, which is their only source of knowledge.
• According to him, all human thoughts are derived from sensory data.
• Rationality, for Hobbes, is a calculating faculty that humans use to add and subtract
pleasures and pain.
• Hobbes maintains sensory stimulation (pleasure and pain) govern human beings and that
the movements prompted by those sensations explain human activity.
• Hobbes differ from Aristotle‘s view that humans are governed by reason and the
religious view of medieval philosophers in that people are at least potentially governed
by faith and morals.
Q: Explain how Hobbes related power with human nature?
• This materialistic view of Hobbes leads him to define human relationships in terms of
power. He divides power into two:
• Natural power, i.e. the power of one‘s physical strength, intelligence, eloquence, beauty
etc
• Instrumental power, i.e. the power of one‘s money, fame, prestige, honor etc
• Hobbes maintained that more power allows an individual to acquire more pleasure and
avoid more pain.
• He, therefore, insisted that all humans want more power.
• Such a view of humanity logically leads to the original situation of man (state of nature)
that is highly competitive and combative.
• All individuals seek their own pleasure, power, and prestige, and soon they are in conflict
with each other.
Q: What is the ‗state of nature‘ mean for Hobbes? What are the most important passions that
derives man at the back?
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• According to Hobbes, state of nature refers to the condition of man before the formation
of civil society or government.
• He argued that the state of nature is a ―pre-political and pre-social condition in which
men live without civil government or without a common power over them to keep them in
fear.‖
• Hobbes argued that the goal and character of moral and political life is determined by
human nature.
• Yet in order to understand human behavior, one has to understand the passions that
derive man at the back.
• According to Hobbes, the most important passions that drive man at the back are:
 Fear of death. It is man‘s self-defense against death, which is the strongest passion and
common to all people. Self-defense against violent death is Hobbes‘s highest human
necessity, and rights are born out of necessity.
 Desire to lead a commodious way of life or the desire for comfort.
 The hope of obtaining the things necessary for a happy living through their industry.
 It is from these passions that the theory of state of nature is derived.
 He denies that man is social and political in nature. Rather, he believes nature
dissociates man.
 The antisocial forces are as natural as the forces that promote civil life. Thus, instead of
serving as a direct guide to human goodness, he argued, nature indicates what man has
to run away from.
Q: Explain how the existence of natural equality among men is the main source of trouble in the
state of nature, according to Hobbes. What are factors, as Hobbes believes, that make the state
of nature a state of war.
 According to Hobbes, the main source of trouble in the state of nature is the existence of
natural equality among men in body and mind.
 He argued that men have equal ability to kill each other.
 He claims that this equality of ability, he claims, leads to equality of hopes and desires,
which lead them to brutal competition when they desire same things.
 In the natural condition of mankind, some men may be stronger or more intelligent than
others.
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 Yet, no one is too strong and smart to be beyond a fear of violent death. Hobbes also
argues that when man is threatened with death, in his natural states man cannot help but
defend himself in any way possible.
 Therefore, the most important concern of men is self-preservation because fear of violent
death is the strongest passion.
 In such a situation, each man desires to deprive of what belongs to others.
 He says, ―If two men desire something, which they cannot both get, they become enemies
and seek to destroy each other.
 Each man seeks to subjugate all the rest until no power is left that threatens his
security.‖
 This implies that in the state of nature men are in a condition of war.
 Even if there may not be actual war in an organized sense, he argues, the attitude
towards war is always there.
 In this situation, fear, force and fraud flourish. Hobbes maintains that they are created by
psychological causes of fear by:
 Competition: Men use violence to take away what others have. Due to the scarcity of
things in the world, there is a constant and rights-based war of all against all.
 Diffidence: Men go for safety for what they have and for themselves.
 Glory: Men go for reputation by using violence in an attempt to avoid being despised
and undervalued by others. It is usually intended for the pleasure of the mind.
 He notes that these factors, he believes, make the state of nature a state of war.
 Since man‘s life is full of ―continual fear and danger of violent death, his life is solitary,
poor, nasty, brutish and short. No place for industry, agriculture, arts, trade….‖
 In the state of nature, everyone has a right to everything.
Q: What are possibilities for man to come out of the state of nature, as told by Hobbes?
What is ―the Law of Nature‖ and ―Rights of Nature‖ for him?
• However, Hobbes is not totally pessimistic about man‘s life in the state of nature. He
argues that there is a possibility for man to come out of it.
• Firstly, the fear of death, desire for comfort and the hope of obtaining it through their
industry create in the minds of individuals the inclination toward peace.
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• Secondly, even in the primitive natural state, human reason comes to man‘s rescue.
• Reason dictates man to accept the principle of not doing something which one doesn‘t
want to be done upon him.
• In other words, man becomes convinced that it is better to give up some liberty in
exchange for security.
• Hobbes calls this rule of reason ―the Law of Nature‖.
• The task of reason is to devise the means of redirecting and intensifying fear of death and
the desire for comfort so as to subdue and avoid the destructive effects of the desire for
glory.
• All Laws of Nature and all social and political duties or obligations, Hobbes believes, are
derived from and subordinate to Rights of Nature, i.e. individual‘s right to self
preservation.
• To the extent that modern liberalism teaches us that all social and political obligations are
derived from and are in the service of individual rights of man.
• In other words, according to the rights of nature, man has a natural right to whatever
means he saw fit for his self-preservation.
• Under these circumstances, everybody is a judge and implementer of his own case.
Q: Why Hobbes stressed on the necessity of strong power? What do you understand by the
phrase „covenant without the sword is nothing but words‟? Hobbes says that everyone is biased
whenever there is a case that concerns him.
• He maintains that every one attempts to cause more harm on the attacker rather than
taking a proportional action.
• This, according to Hobbes, implies that individuals cannot be good judges on their own
cases, and, hence, they require a neutral arbitrator, i.e. a government.
• Hobbes argues that man‘s inclination toward peace and his capacity to be prudent and
moderate is not sufficient to create peace and security.
• The love of glory or pride in our nature complicates civil life.
• He claims that all pleasures of the mind, i.e. pleasures that are not bodily or sensual, are
products of glorying.
• Every man seeks to have others value him as he values himself.
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• Consequently, upon signs of contempt and undervaluing, he becomes ready to destroy

those who despise him.
• Thus, glory tempts him to break his pledge unless there is a restraining power to prevent
him from doing so.
• In other words, as Hobbes says, ―covenants, without the sword, are but words, and of no
strength to secure a man at all.‖
• According to Hobbes, the word covenant refers to the agreement of people to form a
common authority or government that imposes peace and security on individuals for their
common advantage and help people to graduate from the state of nature.
• So, he argues that the words of the people are meaningless without a strong power that
enforces them.
Q: Is “state of nature‟‟ true?
• According to studies on human history, such a state of nature never existed all over the
world.
• Empirical evidence, based on modern sciences such as anthropology and archeology,

suggests that the life of primitive societies was a regulated and well-ordered one like that
of modern human life.
• Therefore, his theory of state of nature is more of philosophical than historical.
• Modern science tells us that all societies have rudimentary forms of government with
family as the lowest unit and custom as a means of enforcement.
1.2. Social Contract
Q: What is “Social contract theory” about? Who are the most famous theorists of this?
How they differ from each others?
• The most important questions in political theory include the origin of the state, how men
lived under some form of political organization and if there was no such organization
originally, why did men choose to form a coercive authority.
• Based on the differences in the answers to these questions, a number of theories have
developed; namely, Social Contract Theory, Divine Right Theory, the Force Theory and
Evolutionary Theory.
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• Social contract is a major concept in modern political thought that says that the
government of a state is the result of a social contract or an agreement of all the members
to establish it.
• This means that the state‘s power and legitimate authority come from the people
generally rather than from God as, for instance, the divine right theory argues.
• The concept emerges from the concept of individualism of Protestant Reformation, which
believed in individual‘s direct and personal relationship with God.
• However, they all agree that the state is a human creation and is a result of a contract.
Q: What is “social contract” for Hobbes? What are Hobbes‟ laws of nature, & his ideal form
of gov‟t?
• Men must seek peace and defend themselves against those from whom peace cannot be
obtained. Thus,
• The first law of nature is that each man ought to be willing to abandon his right to all
things when other individuals are also willing to do so.
• It is this mutual abandoning of individual rights that Hobbes calls a social contract or
covenant.
• As the first Social Contract theorist, Hobbes defines it as a ―voluntary agreement of man
with another man to surrender sovereign power to one man or assembly of men (council)
in exchange for promises to protect them from theft, murder, kidnapping etc.‖
• In Leviathan, Hobbes‘ ignored the concept to divine right and instead placed the source
of governmental legitimacy directly in humanity‘s hands.
• The people, in his view, have a natural right to choose their own form of government.
• However, Hobbes proposed that the ideal form of government is not a democracy but a
state so powerful that its subjects will have little control over it once they have installed
it.
Q: Can you define civil society, the Sovereign and common wealth?
• Hobbes calls the authority created by the agreement a civil society, which is formed when
―each man obliges himself with the rest by contract not to resist the commands of the
man or the assembly that they have recognized as their sovereign.
• Each man contracts only with a view to security and preservation of his life. It cannot be
assumed that any man has contracted away those rights whose loss would affect the
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purpose of all contracts.‖ The multitude of men together united in one person is referred
to as commonwealth and the individual representative of this commonwealth a
sovereign.
• The second law of nature is that men should respect their covenants.
• Hobbes insists that respecting the covenant is the basis of justice or injustice. He
maintains that justice prevails if men respect the original terms of the contract and
injustice prevails if they act on the contrary.
• However, Hobbes insists that this is not the end of everything. Still men do not have trust
as to whether the other side will respect the covenant.
• That is why he proposes the creation of a coercive power as a panacea/remedy to enforce

the covenant among non-trustworthy individuals.
Q: According to Hobbes, How is the Sovereign come to power? Can the rules of the contract
bind to the sovereign? What are the powers of sovereign?
• According to Hobbes, the Sovereign comes into power either:
• Naturally, i.e. when he is a conqueror in war and subjugates other people and territories.
• Institution, i.e. due to the existence of mutual fear of death and violence among
individuals.
• For Hobbes, the Sovereign that come to power through both the mechanisms are
legitimate. The motivation is still fear; hence, for Hobbes, the way they come to power
does not matter much.
 The rules of the contract do not bind the Sovereign because he is not a party to the
contract.
 So, it is unthinkable for the Sovereign to be unjust because he embodies in himself the
wills of all; his actions are virtually their own actions on the principle that ‗whosoever
acts through his agent, acts through himself.‘ In other words, he cannot be unjust because
in the first place he is the one who determines what is just and unjust.
 As injustice implies non-performance of the contract, the Sovereign cannot be unjust

because he cannot violate an agreement of which he was not originally a maker.
 So, by creating the Sovereign, subjects become direct authors of the actions of the
Sovereign.
• Hobbes assigns the Sovereign almost all significant powers.
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• The sovereign has an executive power of making war and peace, choosing counselors,
rewarding, honoring and punishing.
• Hobbes allows the state to regulate property, censor speech and press, dictate jobs and
residence and in general every aspect of society.
• He insists that men do not obey those people whom they do not fear.
Q: Do subjects have any natural right except their self-preservation right?
• Hobbes maintains that individuals‘ right to self-preservation is an inalienable right that

individuals cannot transfer to the sovereign.
• In other words, if the Sovereign himself violates individuals‘ right to self-preservation,

then the latter have a full right to resist because in the first place it was to protect this
right that individuals entered into a covenant.
• The Sovereign has a legislative power, too. He is a law maker and he himself is the law.
• The Sovereign has also a judicial power. He cannot be subject to civil laws as they are his
commands. He is a judge of what is necessary for the peace and defense of his subjects.
• For Hobbes, sovereignty was inalienable; there should not be any power in the state
which is strong enough to oppose the sovereign.
• He is absolutely against the division of governmental power among legislative, executive

and judicial branches. He rejects it on two counts:
• Firstly, whenever the three branches agree they may deliberately restrict individual rights
• Secondly, when they disagree, civil war and dissolution of government may follow.
• According to Hobbes, subjects do not have any natural right except their self-
preservation. Apart from the right to self-preservation, subjects have few rights.
• So, the rights of subjects include those rights permitted by the Sovereign, and the liberty
of the subject depends on what the Sovereign has not prohibited.
• Hobbes has the view that if the Sovereign violates these rights, it means he has
committed sin. For this, he maintains, he will be answerable to God.
• But if you attempt to change the Sovereign, then you are doing injustice because
naturally you cannot take away the rights of the Sovereign without doing injustice to him.
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• Unlike modern thinking, Hobbes is an ardent opponent of a change of government by

revolution. His assumption is a change of government will automatically cause the
dissolution of society, which in turn means returning back to the state of nature.
Q: What is Hobbes‟ criterion of classifying governments? What are his classifications?

What is his best form of government? Why that?
• Unlike Aristotle‘s legitimacy criterion, the main criterion of the best form of state, for
Hobbes, is that of convenience, i.e. effectiveness in the production of peace and security.
• Hobbes maintains Aristotle‘s classification of government depends on moral likes and

dislikes of men.
• For him, the term tyranny, oligarchy, and anarchy show simply the likes and dislikes of
individuals towards these forms of government.
• That is why, he argues, people call a disliked monarchy, a tyranny and a disliked
democracy, an anarchy.
For Hobbes, governments differ numerically:
• Government by one (monarchy) - a government entrusted to one man
• Government by a few (aristocracy) – a government entrusted to an assembly
• Government by the people (democracy) – a government entrusted all people
• In fact, from practical point of view, Hobbes‘ best form of government is monarchy. He
favors monarchy because of the following rationales:
 It is less vulnerable to power competition than aristocracy and democracy
 The monarch can act resolutely/definitely and consistently without much interruption.
Q: Why Hobbes advocates absolutist state?
• The state, for Hobbes, must have absolute power to accomplish its objectives.
• He advocates a strong and terrifying state to keep people in order.
• He insisted that rational individuals recognize the advantage of social peace and, hence
they give obedience to the government.
• His form of government is a government right for all people at all times and places.
• To put it in a nut shell, Hobbes‘ Leviathan, is a giant of a state to which everyone should
voluntarily submit for his own good.
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• In his view, the purpose of the all-powerful state was to reduce fear and violence, not
perpetrate it.
• Nevertheless, in his pessimistic view of human nature, Hobbes provides a powerful

philosophical support for all those who believe that liberty breeds chaos and civil
tranquility.
Q: What is Totalitarianism? Is Hobbes‟ state Totalitarian or Authoritarian? If so/not,

How?
• Totalitarianism is a governmental and social system in which the central state completely
and absolutely controls every aspect of life in the economic, family, religious,
educational, cultural spheres.
• Nazi Germany, Fascist Italy and communist USSR are examples of totalitarian states. In
each of these 20th century regimes, the state controls the individual through total political
regulation of the household, schooling, jobs, residence, and ideology.
• The state imposes a single value system on every citizen and abolishes any independent
groups, businesses, clubs or associations.
• In such a state, loyalty to the state is enforced through spies, secret police, torture, prison
and executions.
• So in light of this, it is important to see whether Hobbes‘ absolutist state is similar to the
ideology of a totalitarian state on a number of counts.
• Hobbes‘ government is a government of covenant.
• The contractual foundation of government is anathema to modern totalitarians who

attack contractual theory because contract implies consent.
• So the Hobbesian state is authoritarian, not totalitarian.
• Hobbes assigns his absolutist state the task of the maintenance of peace and security of
citizens.
• But a totalitarian state is anti-hedonistic and anti-individualistic; rather, it stands for a

collective purpose.
• Hobbes pleads equality before the law among all individuals. Yet totalitarianism lacks
this element because it promotes inequality.
• In the Hobbesian state, the Sovereign permits his subjects the liberty ―to buy, sell, to
contract with one another, to choose their own diet, way of life…‖ This shows that
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Hobbes was a proponent of a laissez faire economic system, to which totalitarians are
absolutely against.
• ETC
Q: Identify and discuss the flaws and contributions of Hobbes‟ philosophy.
His flaws/drawbacks are:
• Firstly, his theory of politics that rests on a major hypothesis, i.e. man has a solitary,
competitive and combative character is half-true. It is very difficult to think how man in a
savagery life can become a cooperative and reasonable creature able to make a social
contract
• Secondly, Hobbes argued that society is a product of contract. But critics say it is only
individuals in a society who can enter into contract.
The major contribution of his philosophy:
• Firstly, his argument that independent sovereign states live in a state of nature has
validity, and
• Secondly, his observation of fear of death as a motive to create social order is profound.
The existence of relative peace between the USSR and USA during the Cold War was
mainly due to fear of mutual destruction if they go to war.
Section 2: John Lock‟s Social Contract and Natural Right Theory
Q: Who was John Lock? What are his philosophies & books? How does Lock explain the
state of nature?
• John Locke, a British philosopher, studied medicine and taught philosophy at the Oxford
University for fourteen years.
• Soon after leaving Oxford, he became involved in political conspiracy aiming at

enhancing parliamentary power at the expense of the Crown.
• Participated in Britain‘s ―Glorious Revolution.‖
• As the most prominent theorist of British liberalism, Lock‘s ideas of natural rights,
government by consent, social contract, limited government, private property and
revolution greatly influenced all modern political thought especially in the United States
of America.
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• Lock wrote many books of which the most prominent one is the Two Treatises of
Government especially the Second Treatise written in 1690 which discusses political
freedom.
• Like Hobbes, his political theory is based on materialist and scientific premises.
• According to Lock, humankind lived in a state of nature, i.e. before the establishment of
governments, insecurity and uncertainty prevailed.
• He maintains that society without government was ―full of fears and continual dangers,‖
exacerbated by the ―corruption and viciousness of degenerate men‖ along with a host of
other ―inconvenience‖.
• But Locke did not go as far as Hobbes in predicating a state of continual warfare. Yet he
still regarded life without government as ―very unsafe.‖
• He defines the state of nature as, ―men living together according to reason, without a
common superior on earth with authority to judge between them….‖
• He argues that it can exist at any time in the history of mankind including the present.
• For instance, wherever there are any number of men, however associated, that have no
decisive power to appeal to, it can be said that they are still in the state of nature. In the
state of nature every man has two natural powers:
• to do whatsoever he thinks fit for his self-preservation and for others within the
permission of the law of nature and
• the power to punish the crimes committed against that law. These are the basis of the
executive and legislative power of civil society.
Q: Explain Lock‘s ―State of war‘‘? Is it the same with Hobbes‘? What is Civil society for Lock?
• Unlike Hobbes, Lock claims that the state of nature and the state of war are not identical.
• According to Lock, a state of war can exist ―both where there is, and where there is not a
common judge,‖ i.e. in civil society and state of nature.
• The state of war consists in the element of the use of force without right, justice and
authority.
• It is the unjust use of force that puts a man into the state of war with one another.
• In other words, the existence of the state of war does not depend on the presence or
absence of a common judge.
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• A state of war can exist in civil society when the force of the common judge becomes
ineffectual.
• In other words, the difference between state of war and state of nature lies in
*The state of nature is characterized by the absence of a common judge and by the absence of
any law except the law of nature
*Whereas civil society, which is the opposite of state of nature, is characterized by the presence
of a common judge with authority to enforce civil law.
• Then, either within the state of nature or within civil society
- The state of war exists if force is used without right
- Or the state of peace, its opposites, prevails if there is no use of force without right.
• Lock defines civil society, the opposite of state of nature, as
―Those who are united into one body and have a common established law and judicature to
appeal to, with authority to decide controversies between them and punish offenders, are in civil
society one with another…‖
Q: What is “Laws of nature” for him? Why this law may be violated by humans in the state
of nature? What necessitated government, according to Lock?
• Lock believes that each individual knows the law of nature (whose source, content and
end are self-preservation) that governs the state of nature by human reason.
• The law of nature tells people that they cannot exercise their freedom to harm anyone
else‘s rights and every man has the obligation to preserve all mankind on the assumption
that a threat to one man is ultimately a threat to all mankind.
• Although most people are reasonable and respect others‘ rights, he argues, some people
may violate them violently in the state of nature.
• Thus, when the victims enforce the law of nature by themselves against the transgressors
of their rights, problems arises because everyone becomes a maker, protector and
enforcer of his rights because
1. The state of nature lacks an established legal system (absence of written law and fixed
penalties)
2. There is an absence of authority to execute laws of nature
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3. There is absence of impartial judge to endorse just decisions. He insists that people cannot be
trusted to judge impartially and hence require a government to judge.
• This is a human sin because the selfish sin will naturally tend to punish transgressors of
rights too harshly.
• As a result, man unleashes retaliation and, hence, there would be escalation of violence.
• According to Lock, this dilemma gives rise to the formation of government whose purpose
is to protect the freedom and well-being of all members of society.
Q:How did Lock‘s state of nature differs from Hobbes‘?
A major difference of Lock‘s state of nature from Hobbes‘ is that his state of nature is not as
violent as Hobbes‘.
• According to Lock, the main threat to self-preservation in the state of nature lies not in
the tendency of men to hurt each other but poverty and hardship of their natural
condition.
2.2. Natural Rights and Ownership of Private Property
Q: For Lock, Which rights are natural rights of individuals? How did property and private
property originate in Locke‘s view?
– Locke holds that from the original state of physical freedom, equality and
autonomy, human beings posses the natural rights to life, liberty and estate
(tangible goods).
– He calls all the three collectively ―property‖.
– According to Lock, it is this right to property that justifies the existence of

government.
– Originally, he contends that God gave the earth and its fruits to men as a resource;
the vast wilderness of the earth was created by God for humans to subdue and
turn into provisions to support human life.
– During this time no one owned anything in private. However, man owned his own
person, i.e. the labor of his body, which is the original natural property.
– However, it is legitimate for individuals to create private property from what is common
to all.
– He also argues that it is labor which justifies and gives value to private property.
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– By mixing our labor with the land and using the fruits of our labor, it becomes our
property.
– In other words, the fact that a man labors to collect fruits from the universal common, the
mix of his labor (private) with the wild fruits (universal common) makes these fruits his
private property.
– There is no need to wait for the consent of others. There is after all abundance, he states.
– He believed that this stipulation on private ownership would assure that there was enough
land for everyone.
Q: What are the limitations to private property as Lock believes?
• According to Locke, there is a limit to private property.
a. This is a spoilage criteria which asserts that a person should not take more than what he
can consume or use, be it fruits or land. In the latter case, it means, a person should own
as much land as he is able to work on. This implies that if the person cannot utilize the
land, it is no longer his private property. In his view, any land that was left uncultivated
was spoilage.
b. The other criteria of limiting property is the sufficiency criteria, i.e. ‗enough and as good‘
must be left to others‘ appropriation.
c. The third limitation is that of the subsistence criteria, i.e. all men have a natural right to
subsistence, i.e. if some people have appropriated much property than necessary for their
survival, those who have no property have the right to others‘ surplus.
Q: What does his theory of consent and political power imply? Do all people enjoy these
natural rights?
• Lock maintains that government is created by the consent of the governed when they
realize ―the inconveniences‖ of keeping private justice in the natural state.
• The rise of disputes in the state of nature is inevitable especially with the growth of
inequalities in property distribution.
• So, as being conscious of these inconveniences, Lock states, individuals agree to unite
into a community to defend one another‘s rights that requires a social contract.
• Therefore, people organize a political society to give remedy for these defects.
• For Locke, a ―commonwealth‖ is a form of government that is created precisely to

preserve natural rights and possessions.
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• “The great chief end, therefore, of men‟s uniting into commonwealths, and putting
themselves under government, is the preservation of their property.”
• ―The fundamental source of the commonwealth‘s legitimacy is the common consent

people voluntarily establishing a government of this sort by mutual agreement.‘‘
• They further agree to maintain such a government only so long as it manages to ―secure
everyone‘s property‖ and preserve the basic freedoms to be found in the state of nature.
• Locke implicitly argued that any government that pursues these basic purposes is
legitimate because it springs from natural laws.
• Conversely, he would regard as illegitimate all forms of government such as monarchies

or tyrannies- that violate these laws by abridging humanity‘s natural rights to life, liberty,
and estates.
• In Locke‘s view, the powers of the state must be strictly limited and always subordinate
to popular control.
• In his understanding, any number of men can enter into a political society to make one
people, one body politic with a supreme government; but those who prefer to remain
outside remain in the state of nature.
• However, Locke made it clear that these natural rights and freedoms did not apply to
slaves.
Q: How did Lock conceives the state; and what is principal purpose of a government?
• Locke‘s conception of state opposes the organic Aristotelian conception that perceives
the state as the natural product of social growth.
• He rejects the non-consensual characteristic of Aristotelian state.
• The organic conception of the state collects the citizenry into a single body, and thereby
permits wielding the masses into the directions the rulers needs.
• Locke‘s conception of state moves away from that of the ‗ship and captain‘ analogy to
that of conceiving the state as an instrument whose sole purpose is to provide a secure
framework for the life property and liberty of the people.
• Locke‘s notion that the fundamental purpose of government was to preserve ―property‖
(i.e., life, liberty and estate) had a tremendous impact on many of the founding fathers of
the United States a century later.
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• The American revolutionaries‘ slogan, ―No taxation without representation,‖ was a

restatement of Locke‘s notion that government should not impose taxes without popular
consent.
• Hence, Locke may be considered the intellectual founding father of the doctrine of
limited government. The notion that the principal purpose of a government is the
preservation of political and economic liberty is the core idea of the modern ideology of
liberalism.
The Nature of Government
Q: For Lock, how is the government formed? What are the natures of Lock‘s government?
• Lock argues that government is formed by fiduciary- a kind of trust between trustees and
the trustor.
• In his view, the people are trustors and the beneficiaries of the trust, while the
government is the trustee, which is the servant of the people.
• The people have the right to change the trustee when it violates the original trust.
• For Locke, government is no more than a tool that continuously depends on the consent
of the people (tacit or silent consent not actual or explicit consent).
• It possesses no mystical nature of either a divine or a supernatural order.
• It is a mere prudential institution that can efficiently and effectively provide a better
security than individuals working along in the natural state of freedom.
• Among the institutions of government, Lock gives much value to the legislature to which
the executive is subordinate.
• In other words, he wanted to see governmental power in different hands.
• Yet the people, the highest and supreme, body is above it.
• He is of the opinion that the activities of the government must be bound by fixed and
known rules of law.
As a proponent of limited government, therefore, Locke placed some limitations on the

legislature:
• The law must apply to all people equally
• Law must not be arbitrary
• Legislature should not raise tax without consent

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• Legislature must not transfer lawmaking power to anybody, for instance, the executive.
• Locke rejected absolute monarchy and is a proponent of limited monarchy, i.e.

constitutional monarchy.
Q: When do citizens need to disobey and cause revolution against the government, as advocated
by Lock?
• Locke advocated the right to revolution if governments fail to protect those fundamental
rights of individuals, i.e. the right to life, liberty and property.
• The citizens have the right to disobey or even abolish the government if the government
threatens their right to life, confiscate their property and imprisoning them unjustly.
• It is not in the nature of government to supersede the natural law and cannot infringe or
ignore natural rights.
• As a trustee- trustor relationship, we entrust the defense of our rights to it, but we do not
relinquish those rights to it.
• So, a government that breaches these rights violates the trust and, hence, Locke supposes,
subjects are entitled to resist it, with violence if necessary.
• Locke often uses the term rebellion in his book, but he adds if there is a gross violation of
those rights, subjects have a right to revolution, i.e. they have a right to take back the
authority originally conferred on the government.
• Yet he contends that this right of resistance should be exercised by the majority of
people, not few people.
• Besides, people should resist only unjust and unlawful force.
• Then, you may ask as to whether Locke‘s doctrine of rebellion can be a factor for
instability. Locke‘s answer is two-fold:
a. People do not resort to rebellion or revolutions on silly matters
b. The right to rebellion and the creation of government by consent are the best fences
against rebellion itself.
Q: When does government get dissolved, according to Lock? How about society?
• For Locke, unlike Hobbes, state and society are separate.
• He argued that the dissolution of government does not lead to the dissolution of society.
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• According to Locke, civil society can only dissolve when there is external conquest, and
when this happens, government dissolves, too.
• According to Lock, governments are more likely to dissolve because of alteration in the
legislature. This can happen in the following ways:
1. When the executive sets up his own will in place of the will of the legislature;
2. When the prince (ruler) hinders the legislative from assembling in its due time, or from
acting freely;
3. When the executive power alters the electoral regulations without consent contrary to the
public good; and
4. When the people are made subject to a foreign power;
5. Furthermore, a government is dissolved when the executive power neglects or abandons

its duty to put the laws into operation.
6. Finally, dissolution of government is deemed to have taken place when either the
legislative or the executive power acts contrary to its trust.
NB: Lock was an advocate of Secularism
Section 3: Jean-Jacques Rousseau and the Idea of the General Will
Q: Who was J.J. Rousseau? How does Rousseau define human nature and state of nature?
• He spent his youth as an ill-disciplined boy due to his mother‘s death early in his infancy.
• He grew up in the hands of care takers. But, Rousseau recalls his child hood as one of
―idyllic innocence, free of societal restraints.‖
• This recollection had a profound impact on the development of his moral philosophy.
• He lived most of his life in Paris. Some of his major works include A Discourse on the
Origins of Inequality (1755), The Social Contract (1762), Confessions and Emile
Education.
• Rousseau insisted that
- human beings are by nature essentially gentle and timid beings living harmoniously in a
tranquil/calm, but primitive, state of nature.
- He believed that humans in this condition were neither inherently good nor evil but were
guided by such benign/kind ―natural‖ tendencies as nonviolence and pity for one‘s fellow
man.
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- the primitive human was thus a noble savage, peaceful and uncorrupted, free, healthy,
honest and happy. In the state of nature, men were innocent, peaceable and romantic.
- there were few needs and even they were easily satisfied by nature. Because of the
abundance of nature and the small size of the population, competition was non-extent,
and individuals rarely interact with one another;
- Even if any interaction exists, they do so for momentary satisfaction or sexual desires.
Hence, there was much less reason for conflict or fear.
- In this natural situation, he supposes, life was pleasant and man lived in the state of
―idyllic felicity‖.
- He contended that man also enjoyed perfect liberty and equality. Human beings lived free
life without being bound by any artificial laws. Human beings knew neither right nor
wrong, and had no any notion of virtue and vice.
- As long as there was no organized social life, however, humanity could not improve its
material welfare or educate itself about the universe in which it dwelt. The noble savage
was a child, barely above the level of animals.
- Just like Locke, Rousseau argued that the state of nature is not a state of war. The reason
is that in the state of nature, the desires of human beings at this time were not
complicated. Human desire was simple, i.e. only food, sex and sleep.
- Moreover, in the state of nature, there was no accumulation of wealth and humans were
free from the corrupting influences of commerce and industry.
- In the state of nature, egoism was absent but compassion was present.
- Rousseau saw compassion for the undeserving in particular and for mankind in general
to be the virtue.
- He regarded contempt of another, which could lead to hurt feelings, as a vice and as
always bad.
• He maintains that in the state of nature, human beings are guided by two instincts or
motivating forces:
- Self-love, i.e. self-preservation of oneself
- Pity, i.e. sympathy or compassion, which inclines man to help others when they are in distress.
NB: He had the view that these two instincts do not contradict each other.
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• Rousseau, however, believed that man possesses reason which is not yet developed in the
state of nature.
• He believed that man was morally incomplete in the state of nature.
• Hence, he could only achieve happiness, which accompanies his moral fulfillment, in the
state.
• He asserts that it is reason that makes possible the long transition from the state of
nature to the state of civilized society.
• Rousseau recognizes that the primitive conditions of ―idyllic happiness‖ in the state of
nature could not last long.
• As time passed, humanity faced certain changes,… finally resulting in public values,
leading to the emergence of shame, envy, pride and contempt.
• He argued that society and the state developed largely as a result of cooperation between
men which is itself a consequence of the development of agriculture and industry.
Q: How does the emergence of private property affect human behavior negatively in Rousseau‘s
view?
• For Rousseau, the invention of private property created human characters such as
greediness, competition, vanity, inequality and vice among the human community.
• Then human beings began to think in terms of ‗mine‘/‗ours‘ and ‗his/her/theirs‘.
• Reason began to be employed in the furtherance of private benefits.
• New fetters (restrictions) were placed upon the poor and new powers conceded to the
rich.
• Eventually, he argues, those who have property noticed that it would be in their interest
to create a government that would protect their private property and privileges from the
poor.
• The poor and the weak are tricked into agreeing to the establishment of these institutions.
• Then, he says a state of war occurs between the ‗haves‘ and the ‗have not‘s‘.
• This implies that state of war occurs in civil society.
• However, Rousseau believes that society and state are not only inevitable but positively
desirable provided that they conform to certain democratic conditions
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Q: Explain, according to Rousseau, how human civilization and societal culture negatively
affected the character of the natural man?
• Society and civilization enslaved and corrupted man and made him unnatural, Rousseau
supposed.
• The development of wider social interactions and an explicit division of labor led to all
the evils of advanced social life.
• It is society that corrupts human beings and encourages evil tendencies.
• In the state of nature, he stated, all men were equal.
• Then, it logically follows that the distinction and differentiation among men are the
products of culture of society.
• He insisted that man‘s environment and social conditions changed his character.
• In order to discover the true nature of man, therefore, Rousseau, examines man in a
‗state of nature‘ living without any of the elements of civilization.
• As stated above, Rousseau thought private property to be the source of social ills.
• He considered that private ownership of property corrupted men and destroyed their
character.
• He regarded men without property (i.e. the Noble Savages) to be the freest.
• Although he did not actually support the abolition of private property, he believed that
private property should be minimal and should be distributed equally among all members
of the society.
• Rousseau thus anticipated the role of the state to minimize private property.
• He wanted the property of the state to be as great and powerful as possible, and that of
citizens to be as small and weak as possible.
• With private property being so limited, the state would need to apply very little force in
order to lead the people, he argued.
• To put it in a nut shell, Rousseau believed that civil society emerged from the
degeneration of a basically good state of nature, which changed due to its internal
instability.
Social Contract
Q: What is implied in the Social contract of Rousseau?

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• The main question now is how mankind should govern itself.
• Rousseau‘s main answer, as provided in his book, The Social Contract, is that
government must be based on popular consent.
• He believed that in order for a government to be truly legitimate, the people in each
generation should have the option of accepting or rejecting it.
• Hence, he stressed that legitimacy is based on a tacit social contract among free people
who collectively constitute what he calls the ―sovereign‖.
• It is the collective sovereign that is the ultimate source of law. The people are capable of
conferring legitimacy on whatever form of government they approve, he claims.
• According to Rousseau‘s theory of social contract, people left the state of nature by
voluntarily transferring their personal rights to the community in return for security of
life and property.
• He makes it clear that it is impossible for humans to return to the freedom of the state of
nature.
• He argues that people should form a society to which they would completely surrender
themselves.
• By giving up their rights, they actually create a new entity in the form of public person
that would be directed by the will of the community.
• Rousseau considers that freedom and equality can be preserved only if each man gives up
all his natural rights to the community as a whole, which becomes a ‗moral and
collective body‘.
• He argues that the social contract implies a situation where men form an association
―which may defend and protect, with the whole force of the community, the person and
property of every association (or member), and by means of which uniting with all, may
nevertheless obey only himself and remain as free as before.‖
• In other words, each man pursues his self-interest in the state of nature until he discovers
that his power to preserve himself against threats of others is no longer strong enough.
• The purpose of the contract is, therefore, to combine security which comes from
collective association with that of liberty, which the individual had before the making of
the contract.
• In society, man loses his natural liberty but gains civil liberty and property rights.
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• In a famous slogan, he declares, ―man is born free and everywhere he is in chains‖,

which implies that unless human beings have the freedom to make moral choices, they
can not live a full human life. Rather, they become slaves.
• Unlike Hobbes, Rousseau does not transfer all powers to a separate body.
• For him, the sovereign is the people constituted as a political community through the
social contract.
• As a member of political community, each individual retains an equal and inalienable

portion of the sovereignty of the whole and remains as free as before.
• In Rousseau‘s view, the new society consists of equal individuals, none of them having
authority over others and all participating in the General Will, which is the sole
foundation of legitimate authority.
• Rousseau argues that under this new social entity, there would be freedom and
equality because each person is a subject (as an obedient to the law) and a
participating citizen (as a law maker).
• That is how the true moral liberty, the freedom of the individual in relation to
himself, can be guaranteed.
• Thus, it is a social contract in which a community of freemen lives in a small state

in which the people can practice direct democracy.
Rousseau‟s General Will
Q: What does the General Will mean, according to Rousseau? What is its role? What are its
basic features? What is expected from individuals in a general will?
– The idea of the General Will is in the center of Rousseau‘s political thought.
– It may be referred as the common interest. According to Rousseau, adhering to

the General Will allows individual diversity and freedom.
– At the same time, the General Will also encourages the well-being of the whole.
– Therefore, it can conflict with the particular interest of individuals because it

does not consider private interests.
– From Rousseau‘s point of view, the General Will is not the will of the majority.
– Rather it is the will of the political organism that he sees as an entity with a life of its
own.
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– The General Will is an additional will, somehow distinct from individual will or group of
individual wills.
– The General Will is, by some means, endowed with goodness and wisdom surpassing the
beneficence and wisdom of any person or collection of persons.
– He believes that society is coordinated and unified by the General Will.
– It actually exists and it demands the unqualified obedience of every individual.
– In fact, Rousseau does not deny the existence of General Will of other associations and
particular societies, but their General Will is particular in relation to the state.
• He held that there is only one General Will and a supreme good and a single overriding
goal toward which a community must aim.
• It emerges through discussion and the process of cancelling out particular wills. It has
two basic features:
- It aims at the general good and
- It must come from all and apply to all
• The General Will is always a force for good and just, Rousseau supposes, adding that it
is independent, totally sovereign, infallible and inviolable.
• According to Rousseau, freedom, equality and sovereignty are the important attributes of
the General Will.
• The individual‘s moral expression lies in his obedience to the General Will.
• If he refuses, he may be compelled to do so. That means he will be forced to be free.
• Rousseau does not permit any disobedience against the General Will once its decisions
have been made.
• Every man must abide by the General Will even though he thinks that he disagrees with
it.
• The reason is that each person wants to be good.
• As a result, individuals would obey the General Will.
• Rousseau noted that the person who ―disagrees‖ with the General Will must be mistaken.
• By definition, the General Will is always right.
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• The essence of the General Will implies that the liberty of each depends on the liberty of
all.
• It is the overriding good to which each person is willing to sacrifice all other goods
including all particular private wills.
Rousseau‟s Legitimate Government
Q: According to Rousseau, which government is truly legitimate? What is his best form of
government?
– According to Rousseau, only republican governments that are based on consent

are truly legitimate.
– He contended that a republic does not have to be necessarily a kind of democracy.
– A state ruled by aristocratic elite can also be considered a legitimate one as long
as the people periodically meet in a free assembly to confirm or withdraw their
approval of the government.
– In fact, Rousseau believed that an ―elective aristocracy‖ was the best of all forms
of government.
– He declared that the wisest should govern the multitude, if they governed for the
common good rather than their own personal advantage.
– This goal could be accomplished in popular assemblies that might meet only a few days
each year.
– The day-to-day business of government was best left in the hands of enlightened elite,
aristocrats who would probably have a better understanding of the common good than the
masses themselves.
– This was a kind of direct ‗democracy‘. Rousseau opposed representative democracy, in

which the people elect their representatives to govern them.
– Where the population is large, the remedy is that representatives should be elected at
local level.
– He maintained that the sovereign authority of the people resided in the community as a
whole.
– It was indivisible and could not be delegated to elected representatives.
– The people could exercise their sovereignty only in free assemblies open to all qualified
citizens, where every man could represent himself.
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– (Dear learner! In Rousseau‘s time, citizens usually meant males who owned a specified
amount of property.)
Q: Which type of democracy does Rousseau advocating? Why?
• He argues that legislative functions cannot be transferred.
• But he holds the view that executive power can be delegated.
• All power is transferred to central authority or sovereign that is the total community.
• Major decisions are made by a vote by all in what Rousseau calls plebiscite that is
something like a town meeting.
• On very important matters, Rousseau indicated that community opinion should approach
unanimity.
• On less important issues, a simple majority would suffice.
• However, Rousseau admitted that a majority can vote to violate the common good of the
entire community.
• In that case, the General Will is shattered and there is no longer any liberty.
• Rousseau asks, ―If a nation likes to injure itself, who has a right to prevent it from doing
so?‖
Reading Assignment Questions
Did Rousseau clearly advocated Separation of Power?
Do you agree with a view that a civil religion that is used by the state for its own ends should
exist?
 What are the key elements of this religion, according to Rousseau?
Unit Three
Utilitarianism
Contents 1.2. Modern Theory of Utilitarianism: Act
and Rule Utilitarianism
Section 1: Definition of Utilitarianism and
Its Variants Section 2: Jeremy Bentham‘s Utilitarian
Thought
1.1. Early Utilitarian Thought
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2.1. Bentham‘s Pleasure and Pain Calculus 3.1. Mill‘s Definition of Pleasure and Pain
2.2. Natural Rights and the Best Political 3.2. Mill‘s Best Political Order
Order
3.3. Mill‘s Idea of Liberty
Section 3: J.S. Mill‘s Utilitarian Thought
and the Idea of Liberty
Section 1: Definition of Utilitarianism and Its Variants
• Defining Utilitarianism
Q What is Utilitarianism?
- Developed in the 19th century by British philosophers; namely, Jeremy Bentham, James
Mill and John Stuart Mill.
- Derived from the fact that it defines goodness by social utility, or usefulness
- A social policy, decision or action is good if it produces the ―greatest happiness for the
greatest number‖ of people.
- an action is right if it tends to promote happiness and wrong if it tends to produce pain.
- Utilitarianism attempts to answer a practical question, i.e. what a man ought to do? Its
answer is that he/she ought to act so as to produce the best consequences possible for the
greatest number of people.
Beliefs of Utilitarianism
• Utilitarianism is similar to social hedonism (the greatest net happiness for all)
• Actions are not intrinsically right or wrong (the end justifies the means- teleological
view)
• believe that people are naturally sympathetic and concerned about happiness of others
• the benevolence principle- widely/equally
• Test your particular interest in reference to the general interest
• Ethical egoism is incorrect
Modern Theory of Utilitarianism: Act and Rule Utilitarianism
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Rule Utilitarianism Act Utilitarianism
*Focus on the morality of particular classes of action *Morality of each action should be judged on the
(…stealinf/keeping promis,…) bases of its utility regardless of moral or legal
*Follow the rule whether it brings greatest happiness or constraints
pain *Stealing /killing may increase happiness
Which position do you hold, Act or rule?
Section2: Bentham‟s Utilitarian Thoughts
Bentham‟s Pleasure and Pain Calculus
- Wrote as nature has placed mankind under the governance of two sovereign
masters: Pain and Pleasure.‖ Theses decide what men ought to do.
- defines ―good‖ in terms of economic goods rather than cultural, intellectual or

spiritual values.
- He argues that all pleasures are equal and there cannot be any distinction
whatsoever among types of pleasures
- He insisted promoting happiness of both individuals and communities
- Bentham introduced a method of calculating Pleasure and pain called Hedonistic

Calculus
- seven factors to be considered when measuring the total amount of pleasure and pain
caused by any action:
Q Read and explain each of the factors
_ Intensity (Strength of the pain or pleasure)
_ Duration (he length of time that the pleasure or pain lasts)
_ Certainty (the probability that the pleasure or pain will occur)
_ Propinquity (nearness in time/will happen immediately)
_ Fecundity (the pleasure is productive of more pleasure)
_ Purity (pleasure that does not cause pain at the same time)
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_ Extent (the number of sentient beings affected by an action)
According to Bentham, pleasure is quantitative and objective.
Q: Read and criticize or praise this view with evidence.
• Bentham was a first proponent of welfare state.
Q What is Welfare state?
- a welfare state is a form of political economy in which the state assumes responsibility
for the general welfare of its population, especially its most vulnerable elements, through
spending on such items as education, housing, health care, pensions, unemployment
compensation, food subsidies, family allowances and other programs.
- Though this idea of welfare state faced severe criticisms, there are still welfare states in
Western Europe in the form of social democracy and the idea is still popular
Q Do you support a free market economic system of or a welfare system in which the government
intervenes in certain areas of the economy? Why?
Natural Rights and the Best Political Order
- Why Bentham Rejected the inalienability and inviolability of Natural rights advocacy?
- Bentham rejected the theory of natural rights advocated by philosophers such as J. Lock
and J.J. Rousseau
• He regarded natural rights that are endowed by nature such as the right to life, liberty
and property as ―simple non-sense‖. The reason was that he believed in the existence of
a democratic government as a precondition in order to secure them.
• He stressed that rights can only exist under an established legal system. In his interesting
analogy, he says that if one talks about the existence of natural rights, it is just like
talking about a child without a father.
• So, in essence, Bentham holds a firm view that only a democratic government guarantees
and protects rights. All rights, Bentham thought, emanate from laws of society and,
hence, they cannot be inalienable and inviolable.
• As they have societal rather than individual origin, he asserted, every right can be
abolished if doing so promotes the greatest pleasure for the greatest number of people.
• What are some major views of Bentham on governance?
• Bentham advocated ‗bottom-up‘ approach
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• He was skeptical of the church and institutional Christianity
• He disgusted British gov‘t and believed that democracy was the best political system;
annually elected parliament which should be supreme; idea of universal suffrage and
secret ballot; opposed the concept of retributive justice(an eye for an eye); instead,
proposed a prison system based on reform and rehabilitation; Impacted modern days
Prison systems significantly.
Section 3: J.S. Mill‟s Utilitarian Thought and the Idea of Liberty
Mill‟s Definition of Pleasure and Pain
How Mill differs from Bentham?
• all pleasures are not equal(there is a qualitative difference between types of pleasure
based on their moral qualities)
• some pleasures are more desirable than others
―It is better to be a human being dissatisfied than a pig satisfied; better to be Socrates
dissatisfied than a fool satisfied,‖
• advocated a hierarchy of pleasures and cares for superior pleasures(educated)
• gives much emphasis to the importance of education
• Argued as gov‘t is responsible to educate citizens and encourage active participation
Mill‟s Best Political Order
What type of government was a legitimate government for Mill?
• For Mill the best form of government is representative government whose existence
depends on advanced civilization and literate society
• proposed the election system of proportional representation by which he meant that

better-educated citizens would have more than one vote
• He holds the view that a simple majority rule would not lead to a better and wiser
government or public policy; the mass of people remains ignorant, selfish and foolish
• He was an advocate to free trade, parliamentary reform, secret voting, equality of women
and universal suffrage, annual elections, trade unions and reform of land tenure
Mill‟s Idea of Liberty
How did Mill conceive liberty?
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- noted, the tyranny of the majority is especially dangerous to individual liberty

because the minority are forced to change its views or learn to conform to
socially accepted norms.
- He proposed that the proper balance between individual liberty and governmental
authority can be stated as a simple principle as: ―The only purpose for which
power can be rightfully exercised over any member of a civilized community
against his will is to prevent harm to others.‖
According to Mill, the government is never justified in trying to control, limit or restrain:
• Private thoughts along with their expression publicly
• Freedom of speech
• Freedom of publication or press
• individual tastes and pursuits as efforts to live happily
• Freedom of association of like-minded individuals.
Individuals can achieve their happiness only when they are free to pursue their interests.
Do you accept the idea that a person should be allowed to harm himself, for instance, by
committing suicide?
- according to Mill‘s view, a legislation that attempts to promote good conduct or to

prevent people from harming themselves is always wrong.
- society should not endeavor to limit the amount or prevent individuals from drinking
alcohol and taking drugs. In a similar fashion, society should not interfere in a person‘s
right to commit suicide. But society can rightly prosecute a person for harming others
while drunk.
- His ―no harm principle‖ prohibits individuals or the government from interfering with the
actions of individuals except to prevent actions that will have harmful consequences on
others
- Like Bentham, he attacked the notion of natural rights arguing that rights do not exist
without social context
- He advocated an economic system that would combine free enterprise/ Laissez- faire and
a measure of government involvement in the economy.
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Unit Four
Emmanuel Kant and the Birth of Idealism
Contents - The State and Perpetual Peace
- Defining Idealism
Q. What is idealism?
- emerged in the 19th and 20th century Europe. Politically, idealism refers to a belief of a
movement or a person that a people or society is capable of improving and achieving
positive ends such as equality, dignity, progress, democracy and freedom through
positive social reforms.
- It was challenged by conservatives in 2 ways. What are they?
• There is an inherent limit to human capacity for goodness (through sin, historical culture,
ignorance) that makes idealism an inaccurate, immature view of humanity; and
• Those human limitations show themselves in idealists through pride, self-righteousness

and intolerance.
Q. The most known idealist movements are????????
*the animal rights movement, socialism and environmentalism
Q. Do you think that animals should have rights equal to human beings? What is animal rights
movt‘t about?
• Animal rights movement: It is a political movement that emerged primarily in the 20th
century that argues for rights of non-human animals (dogs, cats, foxes, chickens etc)
against domination or use by human beings. This ranges from opposition to
experimentation on animals (for medical or cosmetic research) to the prevention of cruel
or neglectful treatment of farm or domestic animals, to vegetarianism, or the non-eating
of meat.
• The philosophic foundation of this movement lies in the assumption that all living species
are equal and equally worthy of dignity and freedom.
• Socialism: It is an idealist movement which believes in society‘s capacity to eliminate

greed and poverty at the last stage of human history, i.e. communism.
• Environmentalism: It is an idealist movement that cares for the protection of the natural
ecology.
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Q: Imply the essence of the 2nd meaning of Idealism
• The second meaning of idealism implies that it is a formal philosophical school that
locates reality in ideas and perceptions of the mind. This version of idealism
originated in Germany.
• For philosophers, German idealism usually means the philosophy of Kant and his
immediate followers.
• The term ―German Idealism‖ refers to a phase of intellectual life that had its origin in the
Enlightenment period as modified by German conditions.
• English and French representatives of the Enlightenment, giving precedence to sensation,

had become empiricists and skeptics.
• They viewed the world as a great machine, adopted hedonism as their ethics, and
interpreted history from a subjective-critical point of view.
• Idealism asserts that mind, consciousness and ideas determine the nature of social being
and shape its material conditions.
• Idealism rejects the existence of a divinely ordered natural law. Hence, it sees human
ideas as constructed reality (social and governmental institutions) that become the truth.
Section Two: The State and Perpetual Peace
Q: What is the role of the state in Kant‘s view?
• Kant regards the state as a union of a multitude of men under law.
• He argues that the end purpose of the state is for the advancement of mutual freedom of
citizens through their common obedience to law.
• Besides, he assigns to the state the responsibility of guaranteeing civil liberty in which
nobody will be obliged to obey anything else other than those decreed by law.
• In a just civil government, the rights of humanity are secured, establishing a reciprocal
obligation on the part of each citizen to respect the rights of others
• Thus, some limitations on freedom exist through the rule of law and the state‘s right to
punish
• For Kant, then, the value of legitimate government is that it guarantees our natural rights
to freedom and equality and provides us a foundation from which to acquire other rights.
Q: What are the two forms of gov‟t for Kant? What chrzes each?
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Republicanism Despotism
-a constitutional government in which there All the rest forms of government fall in the
is an elected legislative assembly under the category of despotism.
principle of separation of power. Kant
thought that it is only a republican
government which can avoid war and crimes.
Q: How can International Peace be maintained? According to this view,
- the real relation between nations is analogous to the hypothetical relations among
individuals in the state of nature.
- Just as public justice must be established in the single, domestic state to secure each
individual‘s right to freedom within that state, public justice must be established on a
global scale too so as to secure the rights of all humanity.
- For mankind to reach its ultimate destiny, Kant proposed a voluntary federation of
states, or a ―league of nations‖, whose common law would preserve equality and mutual
respect among nations.
- However, this federative body cannot have sovereign power over the sovereignty of
member states. Ultimately, Kant suggested in his Perpetual Peace (1795) that only such
a world federation would bring an end to war and lead to the realization of justice and the
guarantee of civil liberty.
Q: How do you evaluate the effectiveness of this federation in the absence of a sovereign power
to impose binding decisions on member states?
- - In Kant‘s analysis, it is in accord with nature‘s plan that evil things such as war, crime
and tyranny will ultimately lead to their opposites.
- He thought that through long years of human progress, these evils teach humanity
lessons.
- Finally, he thought that permanent peace would prevail.
- - He opposes the formation of a world government or a universal state. The reason is that
a universal state will lead to universal despotism and if a government gets more power,
then law will lose its force.
Q: Discuss steps to sustain world peace, according to this view;
steps that are necessary for world peace. Some of them are:
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• The suspension of hostility among warring states to stop war does not guarantee peace.
For him, peace means an end to all hostility, which can be possible only under a
federation of states,
• Standing armies should be abolished because they are threats to others. He argued the
presence of national armies would disrupt peace. Besides, he maintained the idea that the
use of soldiers to kill and allow them to be killed is immoral. In fact, in line with this,
Kant has also developed a deontological theory of ethics that rejected the utilitarian
consequentialist theory of ethics.
• A state‘s interference in the affairs of another state should be prohibited.
Reading Assignment
• What kind of government is a world federation of states and on what grounds does it
differ from the current United Nations?
• Which do you think will bring about worldly peace- a federation of states or a universal
state? Why?
Chapter Five
Socialism, Marxism-Communism
Contents
• Hegelian Dialectical Idealism
• Hegel‘s Dialectics
• Definition Origin and Evolution of Socialism and Communism
• Karl Marx and Dialectical Materialism
• The Genesis of Marxist Philosophy
• Marx‘s Material Forces
• Economics as a Motor Force of History
• Class Antagonism
• Marx‘s Theory of Alienation
• Social Revolution and the Role of the Proletariat
• Soviet-Style Communism
• Imperialism and the Need for a Vanguard Communist Party
• Features of a Marxist-Leninist State
5.1. Hegelian Dialectical Idealism
Q: Who was Hegel and what he did? Explain his dialectical idealism
• George Wilhelm Friedrich Hegel was the most prominent German philosophers.
Hegel was a philosopher in Berlin University.
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• It is Hegel who laid the philosophical foundation for Marxian thought. He was the
founder of modern idealism and dialectical idealism.
• Within Hegelianism, dialectic acquires a specialised meaning of a contradiction of ideas

that serves as the determining factor in their interaction; comprising three stages of
development: a thesis, giving rise to its reaction; an antithesis, which contradicts or
negates the thesis; and the tension between the two being resolved by means of a
synthesis.
Q: What does he said about history and reason?
• He wrote about the philosophy of history and reason. According to Hegel, history and
reason are not separable.
• In his view, history is in essence a march of Spirit toward a determined and identified
goal or endpoint.
• Hence, Hegel does not want to construct an ideal state but to rehabilitate the real state in
showing that it is rational.
• Hegel wants to show the rational in the irrational. Not only does he want to discover the
necessary essence of the state behind the contingent details, but he also wishes to show
that what appears irrational in the state itself works unconsciously toward the triumph of
the rational.
• But, what appears contradictory initially will finally be brought into harmony.
• Therefore, Hegel believed that the bad leads to the good, the passion to reason,
contradictions into synthesis
• He takes us to objective idealists who believe that reality is idealistic or spiritual in

nature, but it exists objectively or independently of us ‗out there‘.
• Hence, Hegel said that reality was spiritual but it is under constant movement and
change.
• God controls the movement of human history.
• According to Hegel, the final mechanism by which this historical-spiritual process is

achieved is called dialectic.
Hegel‟s Dialectical Conception of History
• Dialectic‘ means the give and take between opposite states resulting always in higher
unity.
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• In the views of Hegel, a thesis represents a given dominant idea, form of government,
social organization or religious belief at a certain phase of human history.
• According to Hegel, it is natural that every thesis produces its own enemy (antithesis),
which will ultimately destroy the thesis.
• The contradiction between the two opposites gives rise to the emergence of a synthesis,
which will transform itself to a thesis.
5.2. Socialism & Communism
Origin and Definition of Socialism and Communism
• Before defining socialism and communism, let us assess the socio-economic environment
that laid the foundation for new economic systems.
Q: What are conditions that led to dev‘t of Socialism?
- The origins of twentieth-century socialist movements are found in 19th Century Europe.
Socialism emerged as a reaction to the excesses of the industrial revolution and free enterprise.
- Over the course of the 19th Century, the spread of manufacturing in Britain, France, Germany
and several other countries rapidly affected the cities and countryside with grimy factories and
slums.
• Men, women, and children worked long hours for fewer wages. For much of the century,
governments did not do anything to regulate working hours, safety standards, or child
labor. Rather, business owners were free to deal with their work force as they wished.
• Moreover, health care and unemployment insurance either did not exist at all or were
grossly inadequate.
• The majority of the working class faced a desperate future with little hope of improving
their lives. Peasants who owned little or no land also labored for their landlords under
similarly difficult circumstances.
• Therefore, in the first half of the 19th Century, a number of socialist thinkers devised
detailed plans to replace the free-enterprise system (capitalism) with an entirely different
economic system.
• Capitalism was an exploitative and unstable economic system that had to be replaced by a
more human society based on the values of equality and community.
• The new economic systems were to enable the workers, or the people as a whole to
collectively own the factories, farms, mines, and other productive enterprises.
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• Hence, it was thought that common ownership of the economy would replace private
ownership. Western literatures call these thinkers utopian socialists.
• The word Utopia originates with Sir Thomas More‘s design for an ideal society, which he
devised in his book, Utopia, published in 1516. By extension, it denotes an imaginary
ideal society.
• An ideal society is typically one from which present evils have been eradicated and in
which perfect peace, harmony and social justice prevail. The earliest Utopia is Plato‘s
Republic.
• However, efforts to establish ideal socialist communities largely failed in Europe.
Q: Who was the Pioneer of Socialism?
• It was Karl Marx who elaborated a more enduring approach to socialism. Utopian
socialists significantly influenced Marx. But in the course of his long career, he
developed a far more complicated system of thought that incorporated elements of
philosophy, history, economics, sociology and political theory.
• Marx turned out to be a principal intellectual source of the twentieth-century socialism. In

fact, his contemporaries and subsequent generations interpreted his complex ideas in
different ways.
• Yet, Marx himself shared the basic notion of the utopian socialists that capitalism was
inherently flawed. Hence, he argued that common ownership of property by the working
masses had to replace it.
Q: What does Socialism represents?
• Socialism represents a long tradition of political thought that emphasizes the values of
social equality and social solidarity. Its modern form began in the early 19th century as a
response to industrialization.
• Earlier forms of socialism are based on small self governing communities. But, the
modern form of socialism stresses on state ownership and central economic planning.
• The revolutionary form of socialism is Marxism, which has a history of its own.
• However, it should be noted that most socialists seek to bring about social change
through peaceful means instead of revolutionary method.
• Therefore, in its original nineteenth-century conception, socialism became a political and

economic system in which some form of common ownership of factories, farms and other
productive enterprises would replace private enterprises.
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Q: What is Communism? Tell differences with socialism
• Most nineteenth century theorists, including Marx, made no sharp distinction between
―socialism‖ and ―communism‖ and used these words interchangeably.
• The experience of communist countries led many socialists to believe that the abolishing
of capitalism as a system was not a necessity. Rather, they focused on the creation of
ideal societies in terms of state-managed capitalism and extensive welfare systems.
• According to Marxist theory, communism is the final and the last stage of social
development. As an idea, it is a very old one.
• Western political thought has various ideas on communism in different forms for more
than 2000 years dating back to Plato‘s communism.
• But, modern communism derives in most part from the works of Karl Marx and Fredric
Engels. It is a political theory and system which believes that greater equality and justice
will prevail in society where no private ownership of productive property exists.
• It places ownership of the means of production (property) in the community.
Q: How does communism characterizes human nature?
• Communism assumes that man is in general good.
• It is private ownership of property that corrupts humans, thereby making them greedy,
selfish, arrogant and uncooperative.
• In other words, communism assumes that it is the social environment that causes immoral
behavior among human beings.
• This is a direct opposite of the classical, Christian and liberal political perspectives which
believe that evil exists in human nature.
Q: Identify & Explain the dimensions of Communism
• Communism has two dimensions. These are theoretical and practical.
• The former dimension has its clearest form in The Communist Manifesto which Marx
and Engels together wrote in 1847. However, the actions and programs of its great
leaders reveal its practical dimension.
• However, the latter is more important in the definition of communism.
• Communism is mainly a practical doctrine. For communism to take place, there should
be a revolution. In the views of Marxist-Leninists, the proletariat, under the vanguard of a
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communist party, carryout the revolution. To achieve this aim, the working class makes
use of every possible means of violence and insurrection.
Q: Explain the laws of contradiction, according to Marx-Engels-Lenin‘s interpretation
• According to the writings of Marx and Engels and Lenin‘s interpretations, the laws of
contradictions in which material forces play the decisive roles cause all social progress.
• The society is divided into two contending social classes: the dominant or exploiting, and
the dominated or exploited.
• The former becomes the thesis and the latter anti-thesis, and the contradiction between
them leads to a new social development, i.e. synthesis. On the basis of this explanation,
Marx and Engels could predict that socialism replaces capitalism.
Q: Who was Lenin? What does he did?
• But, as it could not occur in any capitalist country especially in Europe, Lenin discovered
the growth of capitalism into a form of imperialism that caused the First World War. This
implies that the crisis of capitalism that Marx and Engles predicated might not lead to its
collapse. Because as Lenin discovered it later, capitalism has various mechanisms to
reform itself and survive for a long period of time.
• As Lenin forcefully argues, in any and every serious revolution, a long, obstinate,
desperate resistance of the exploited, who for many years will yet enjoy great advantage
over the exploited, constitute the rule. Never will the exploiters submit to the decision of
the exploited majority without making use of their advantages in last desperate battle or a
series of wars.
Q: What are the 2 stages that envisage the doctrine of communism?
• After successful socialist transition, there are two steps envisage the doctrine of
communism.
• The transitional stage comes after the victory of the working class in a social revolution
and establishment of proletariat dictatorship by abolishing the class of capitalists, feudal
lords, reactionaries and counter-reactionaries aiming at the creation of a classless society.
• The final stage is the ‗post-revolutionary stage‘ or the last phase of social development
ensuring full freedom of man. It is the goal towards which the communists have to move.
Communist society is the final stage of human history as envisioned by Karl Marx.
• It follows the ―withering away‖ of the socialist state. In Marx's view, capitalism comes
into power via the thesis-antithesis-synthesis paradigm, and will inevitably be overthrown
by the same way to create socialism.
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• However, socialism will not be overthrown but will be a transition naturally into
―stateless communism‖. Some writers object that Marx did not explain the (natural)
process by which socialism transforms to communism.
5.3. Karl Marx and Dialectical Materialism
The Genesis of Marxist Philosophy
Q: Who was Karl Marx? Trace the Genesis of his philosophy
• Karl Marx was born to a Jewish family in Germany and lived from 1818-1883. He
quickly became attracted to the ideas of Hegel especially his philosophy of dialectical
process of history.
• But Marx rejected Hegel‘s assumption that God dictated the dialectical process because
Marx was an atheist at the time. By rejecting Hegel‘s dialectical idealism, he developed
the theory of dialectical materialism.
• In his dialectical materialism, Marx combined Hegel‘s dialectical evolution of history

with a new idea, i.e. material forces, not God, control the dialectical process.
• He developed a highly coherent theory of history, politics, economics and revolution. His
major work is Capital, whose first volume was published in 1867. It was Engels who
published the subsequent volumes following Marx‘s death in 1883.
• As he wrote, ―The philosophers have only interpreted the world, in various ways.‖ He
said, ―The point, however, is to change it.‖
Q: What was/is/will be the main force dictating human history? What were r/ns b/n Marx and
Engels?
• In his early manuscripts on political economy, Marx concluded that economic factors
were the primary material sources of human action.
• In this new endeavor, Friedrich Engles (1820-1895), who was a son of a wealthy German
industrialist, joined him.
• The two became lifelong collaborators. Yet, Marx was the creative thinker while Engels
contented himself with popularizing Marx‘s ideas.
• One of their most famous works was the Communist Manifesto. In this and other
subsequent works, Marx developed two critical ideas that defined the meaning of
dialectical materialism in practice.
Q: Explain Historical or philosophical materialism
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• Historical or philosophical materialism is a political theory developed by Marx and

Engels that conceives historical change and progress as motivated by technological
advancement in economic production. It sees most of social phenomenon as
superstructures which reflect the materialist structure of the economy.
• For instance, the organic and hierarchical theology of Medieval Christianity reflects the
social class structure of the European Middle Ages and economic feudalism.
• This theory believes that it has discovered the laws of history, which prove that
capitalism will inevitably lead to socialism and then communism. Like that of Darwinian
Theory of biological evolution, it believes that human progress follows natural laws.
Hence, it rejects any supernatural and spiritual dimension to human history.
Marx‟s Material Forces
Q: Explain the materialist view of history.
• According to Marx, economic factors determine everything else that happens in human
affairs. In other words, Marx thought that the motivating force for every human action is
the necessity to produce the means of subsistence (survival).
• This materialist view of history starts from the premise that the most important
determinant of social life is the work people are doing, especially work that results in the
provision of basic necessities of life, food, clothing and shelter.
• He also assumes that the way each work is socially organized and the technology used in
production would have a strong impact on every other aspect of society.
• In other words, what men work determines the essence of humanity, i.e. human beings
express themselves in what they produce. He maintained that everything of value in
society would result in human labor. Thus, Marx saw working men and women are
engaged in making society and in creating the conditions for their own existence.
Q: Explain ―means of production and r/ns of production
According to Marx,
• All economies are based on certain material ―means of production‖, which include
factories, land, technology, and the human labor
• All economies have distinctive ―relations of production,‖ which are the social
relationships that exist among individuals and groups that participate in the production
process.
The following examples show the relations of production that exist at different stages.
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• Example 1: Under conditions of slavery, the relations of production centered on the

relationship between masters and slaves.
• Example 2: In nineteenth-century industrial capitalism, the relations of production

centered on the interactions between private employers and the work force.
• Marx claims that the means of production and the relations of production together form
the base of society.
Q: Explain the base of society
• Is the relationship between the infra-structure (i.e. the means of production and the
relations of production) and the super-structure ( i.e. the forms of state, politics, art,
morality, ideology, religion, law, science, education, society and so on).
• Hence, the economic base (infrastructure) determines the superstructure. To put it

narrowly, economic determines and influences politics.
• In this manner, whoever controls the economy also controls the political system and the
social institutions that support the class structure of society. Ideology and social
institutions, in turn, serve to reproduce and perpetuate the economic class structure.
Class Antagonism
Q: Explain Marx‟s concept of Class Antagonism
• Marx maintained that whenever there was private ownership of the means of production,
social classes would come into being.
• From Marx‘s point of view, the relationships between the main social classes under
conditions of private property, are invariably antagonistic.
• Thus, ―The history of all hitherto existing society,‖ he wrote in the Manifesto, ―is the
history of class struggles.‖
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Example 1: In the ancient world slave owning society, master class and the slave class were in
hostile confrontation.
Example 2: In the nineteenth-century capitalism of Europe, the capitalist class confronted the
working class.
Q: Who are the bourgeoisie & Proletariat?
• Marx used the term ―bourgeoisie‖ in reference to the capitalist class. The term comes
from the word ``bourg``, to mean city. During Marx‘s time, industrial capitalism was
largely an urban phenomenon.
• The bourgeoisie consisted of few entrepreneurs who owned factories and other
productive enterprises, together with other private business people who profited from
provision of services in a free-enterprise economy. These business people included
bankers, lawyers, accountants and so on.
• According to Marx, the term ―proletariat‖ comes from the Latin term proletarians which
refers to the industrial working class, which mainly consisted of factory laborers.
Q: Explain how these 2 classes operate under the laws of the dialectic
• In Marx‘s view, these two classes are natural enemies operating under the laws of the
thesis and antithesis of Hegelian philosophy.
• According to the laws of the dialectic, the bourgeoisie creates the class that will destroy
it. By building factories, the capitalists in effect create the working class.
• Marx wrote that ―What the bourgeoisie therefore produces, above all is its own grave-
diggers.‖ This is a natural part of human history which the bourgeoisie cannot avoid.
• Marx believed as industrial capitalism matures over time the ―contradictions‖ inherent in
the relationship between the bourgeoisie and the proletariat inevitably intensifies.
• The rich grow richer while the poor get poorer. Moreover, there is a fierce competition
among capitalists to get profit. In this fierce competition, capitalists exploit the working
class more than ever before. Then the most successful capitalists drive their competitors
out of business.
• Marx calls this process of competition monopolization. As a consequence, the

bourgeoisie class shrinks in size and society‘s wealth concentrates in very few hands.
• The middle class, consisting of small and independent property owners such as shop
owners, artisans, small farmers, and so on, are also victimized by the relentless pursuit of
capitalist competition.
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• Thus, crushed by aggressive large-scale businesses, the middle class literally disappears
and sinks into the working class.
• In this manner, the number of the proletariat increases and it becomes beyond the
capitalist system‘s ability to employ them. Then, the unemployed grow into a vast
―reserve army of the proletariat,‖ called the lumpen proletariat.
Q: What is the role of state and its institutions, according to Marx in this process?
• Meanwhile, the capitalist elite use its control over the state to reinforce its subjugation of
the proletariat. For Marx, therefore, the state is always an instrument of class domination.
• The manifesto says, ―Political power is merely the organized power of one class for
oppressing another.‖ He says that in capitalist societies, the executive of the modern state
is simply a committee for managing the common affairs of the bourgeoisie.
• Police power, for instance, is used to enforce property rights and guarantee unfair
contracts between capitalists and workers. Religion serves capitalist interests by
pacifying the population; intellectuals, paid directly or indirectly by capitalists, spend
their careers justifying and rationalizing the existing social and economic arrangements.
• In Marx‘s view, electoral democracy in capitalist societies does not generate any hope for
the working class. He rejects it as nothing more than a ―bourgeois democracy,‖ whose
machinery the capitalist class manipulates for its own benefit.
• Electoral democracy, the legislatures, political parties and politicians, he maintains, do

not benefit the working class.
• When the proletariat eventually grows in number, Marx argues, the time becomes ripe
for carrying out a social revolution.
• The several social theories that emphasize social conflicts have roots in the ideas of Karl
Marx.
Q: Identify the emphasis of Marxist conflict theory of state. Explain his materialist
interpretation of history.
• In general, the Marxist conflict theory of state emphasizes on a materialist interpretation

of history, a dialectical method of analysis, a critical stance toward existing social
arrangements, and a political program of revolution or, at least, reform.
• Marx divided human history into five stages.
Q: Identify these stages and Indicate what form of economic and social organization
characterizes each of the successive phase?
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• According to Marx‘s outline of history, a sophisticated form of economic and social

organization characterizes each successive phase.
1. At the dawn of civilization, when cave dwellers and forest people shared the land, a
classless primitive communism prevailed.
2. As the centuries unfold, the world of ancient Egypt, Greece and Rome emerged with
class struggles between slave masters and slaves.
3. This economic system gave way to medieval Europe, with aristocratic feudal landowners
confronting impoverished serfs and a rising business class, i.e. the bourgeoisie.
At approximately the same time, China and other parts of Asia experienced a mode of production
in which a central state organizes vast hydraulic (i.e., water management)
4. The fourth stage of history is Marx‘s own time and place, i.e. 19th century Europe.
Characterized by industrial capitalism and the fierce struggle between the bourgeoisie
and proletariat; this stage has witnessed extraordinary scientific and technological
achievements. However, it was destined from the start to explode in a working class
revolution.
5. Socialism/Communism, the fifth stage of human history, would be the final stage,
marking humanity‘s arrival at a state of veritable social perfection.
Q: Explain Marx‟s Theory of Alienation
• Marx‟s Theory of Alienation

Marx‘s Theory of Alienation is one of the most popular theories of Marx.
• It refers to the separation of things that naturally belong together, or to put antagonism
between things that are properly in harmony.
• It is based upon his observation that in industrial capitalism, workers inevitably lose
control of their lives. They do not have any control of their work and products of their
labor. The workers receive less that helps them to survive only
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• As the exploitation increases, labor becomes a mere commodity. Machinery substitutes

creativity and skill. Since labor is part of the essence of humanity, Marx, assumes, this
situation alienates workers from themselves.
• Thus, they become dehumanized, deriving their satisfaction only from physical
pleasures. By so doing, capitalism creates complete alienation.
• Alienation in capitalist societies occurs because in work, each contributes to the common
wealth, but can only express this fundamentally social aspect of individuality through a
production system that is not publicly social, but privately owned, for which each
individual functions as an instrument, not as a social being.
Q: What are the 4 types of alienation of labor under capitalism, according to Marx?
Marx forwards four types of alienation of labor under capitalism are:
• Alienation of the worker from his or her human nature, which is meant to produce freely
but is tied to forced labor. The worker‘s life fails to manifest the characteristics of a truly
human life. He is also alienated from nature itself, which humanity is supposed to
control, but which enslaves humans;
• Alienation between workers (alienation from the community of his fellow men).
Capitalism forces individuals to compete and fight with each other while human nature
requires them to be cooperative to fulfill every one‘s needs. Hence, it destroys social
relationships;
• Alienation from the process of production itself in that work comes to be a meaningless
activity, offering little or no intrinsic satisfactions to the worker.
• Alienation of the worker from the product he produces because the labor is not performed
freely and creatively so that the worker does not recognize or understand it. The product
is appropriated by the capitalist class, and becomes outside the worker‘s control. His
labor, instead of producing something beneficial to the worker, produces misery.
Hence, the worker‘s product becomes an alien, hostile, powerful and independent object in the
hands of capitalists. Private property is thus the product, the result and the necessary
consequence of alienated labor.
Q: What, when and how is Proletarian Revolution; and explain the role of proletariat in
the revolution?
Social Revolution and the Role of the Proletariat
• A proletarian revolution is a social and/or political revolution in which the working class
attempts to overthrow the bourgeoisie.
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• It is socialists particularly those of the communist variety that advocate proletarian

revolutions.
• In the Marxist view, proletarian revolutions will inevitably happen in all capitalist
countries regardless of any other super-structural differences. The workers themselves
take possession of factories, farms, and other productive enterprises.
• The proletariat, armed with a growing ―class consciousness,‖ ultimately takes matters
into its own hands, undertaking the forcible overthrow of all existing social conditions in
a spontaneous revolutionary outburst.
Q: Then, after revolution, what to happen?
• In some cases, the workers may have to establish a ―dictatorship of the proletariat‖ to
supervise the gradual takeover of economic power from the capitalists. state, as Engels
put it, ―dies out.‖
• While politics withers away in communist society, economic conditions of the masses
vastly improve that is “From each according to his ability, to each according to his
needs.”
• They did not also outline a communist ―constitution,‖ because there would be no
government since a classless and stateless society is to be established.
Q: What are Legacies of Marxism?
• Marxism has left its own legacy in both economic and political spheres.
• Economically, as stated earlier, West European countries have developed a social

democracy, a political system in which they mix private enterprise with that of a welfare
state system.
Features of a Marxist-Leninist State
• In contrast to Marx‘s tenets, Soviet rulers created a powerful state. Thus,
• Instead of ―dying out‖, the state grew into a huge bureaucratic arm of Communist party
rule. The Soviet state became a highly politicized state.
• The state consisted of party and governmental institutions that joined in propagandizing
the population, controlling media, repressing dissent, implementing policies over which
the people had little or no influence. They key idea of Leninism is the primacy of the
communist party. It is the party that leads the revolution. He believed that it should be the
party that should govern the country once the revolution has eliminated its enemies.
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Unit Six
Anarchism
Q: What do you think Anarchism mean? Let U guess its meaning and list some of its major
views about state and government.
6.1. Meaning of Anarchism
Literally- derived from Greek ‗anarchos‘- without ruler.
• As a theory- refers to a natural state of society in which people are not governed by
submission to human-made laws or to any external authority.
• Anarchism is above all a moral doctrine concerned with maximizing the personal
freedom of individuals in society.
• As such, anarchism is the belief that governmental regulation is both unnecessary and
harmful to society.
• Human beings are by nature good, but are corrupted by societal institutions.
• Those institutions, particularly the state, must be destroyed to allow the natural
development of voluntary associations among individuals and groups.
• In other words, anarchism is a political theory which rejects (and supports the elimination
of) compulsory government or compulsory rule, and holds that society can (and should)
be organized without a coercive state. Anarchists believe that government is
both harmful and unnecessary.
In general, Anarchism is a political theory that holds that
• all state authority and other forms of authority such as family, school, church or God are
oppressive and unjust;
• the abolishing of government will produce the greatest individual and collective freedom
and prosperity and;
• it is governmental authority that imposes unfair rules on people, steals their money, and
keeps them in slavery.
Q: Take time and think over the practicality or truth of the Anarchist views held over authority
(state, Government, others).
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6.2. Origin and Development of Anarchism
How & when did Anarchist thinking originated & Developed in d/t parts of the world?
• Humans lived for thousands of years in societies without government;
• rise of hierarchical societies(coercive political institutions) is criticized & rejected by

anarchists.
• The "Tao Te Ching", written around the 6th Century B.C. by Lao Tzu, encouraged many
Chinese Taoists to live an anarchistic lifestyle.
• In ancient Greece, Diogenes of Sinope and Zeno of Citium argued (in opposition to
Plato) that reason should replace authority in guiding human affairs, and envisaged a free
community without government.
• a variety of anarchistic religious and political movements in Europe during the middle
ages but none had much widespread influence.
• Modern Anarchism arose from the secular thought of the Enlightenment
• Jean Jacques Rousseau‘s arguments for the moral centrality of freedom
• William Godwin (1756 - 1836) developed what many consider the first expression of
modern anarchist thought
• He advocated extreme individualism, proposing that all cooperation in labor

be eliminated
• Edmund Burke advocated the abolition of government
• Thomas Jefferson spoke of his respect for a society with no government, such as he saw
in many Native American tribes,
• Henry David Thoreau was another influential American with Anarchist sympathies.
• Pierre-Joseph Proudhon was the first self-described Anarchist, and has been called
the founder of modern anarchist theory (as has Godwin)
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• Proudhon proposed what he called spontaneous order, whereby organization (sufficient to

maintain order and guarantee all liberties) emerges without central authority
• In the 19th c, Anarchist Communist theorists -emphasizing the importance of

a communal perspective to maintain individual liberty in a social context.
• Those, Mikhail Bakunin (1814 - 1876) and Peter Kropotkin (1842 - 1921), built on the
Marxist critique of Capitalism and synthesized it with their own critique of the state
• In the 20th Century, Anarchists were actively involved in

the labor and feminist movements, in uprisings and revolutions such as the Russian
Revolution of 1917, and later in the fight against Fascism.
• Jean Jacques Rousseau, William Godwin, Edmund Burk, Thomas Jefferson , Henry
David Thoreau, Pierre-Joseph Proudhon, Mikhail Bakunin & Peter Kropotkin, all argued
or wrote against coercive political institutions.
6.3. Variants of Anarchism
Except rejection of compulsory state or government or any other such authority, proponents of
anarchism may support anything from
• extreme individualism (the political outlook that stresses human independence and the
importance of individual self-reliance and liberty) to
• complete collectivism (the political outlook that stresses human interdependence and the
importance of the collective)
• Philosophical Anarchism
-William Godwin(founding father);
- State has no right to command individuals;
- advocate no revolution but gradually freeing individuals;
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- accept the existence of minimal state as ‗necessary evil‘;
- but argue that citizens do not have a moral obligation to obey the state when its laws
conflict with individual autonomy.
• Individualist Anarchism (or Libertarian Anarchism)
- Max Stirner (best known proponent);

- individual conscience and the pursuit of self-interest should not be constrained by
any collective body or public authority;
- emphasize negative liberty; supportive of privately held property & free markets;
- egoist form of it is presented by Stirner, which supports the individual doing exactly what
he pleases, taking no notice of God, state or moral rules.
- Its d/t forms include:
 Mutualism
- largely associated with Pierre-Joseph Proudhon (1809 - 1865)
- envisioned a society where each person might possess a means of production either
individually or collectively, with trade representing equivalent amounts of
labor (the labor theory of value).
- support markets and private property in the product of labor only insofar as they ensure
the workers right to the full product of their labor.
- Some commentators suggest that Mutualists are more concerned with association, and so
are situated somewhere between Individualist and Social or Collectivist Anarchism
- Free-Market Anarchism( Anarcho-Capitalism-
- is a more extreme form of Individualist Anarchism that attempts to reconcile

Anarchism with Capitalism,
- and it forms part of the broader movement known as Libertarianism.
- It advocates the elimination of the state;
- the provision of law enforcement, courts, national defense, and all other security
services by voluntarily-funded competitors in a free market rather than through
compulsory taxation;
- the complete deregulation of non-intrusive personal and economic activities;
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- and a self-regulated market.

Gustave de Molinari (1819 - 1912) most important contributor to the theory,
- and in general its popularity was centered in the United States.
 Agorism
- is an extreme form of Anarcho-Capitalism and Libertarianism,
- developed by Samuel Edward Konkin III(1947 - 2004) and building on the ideas
of Murray Rothbard (1926 - 1995), which takes as its ultimate goal ―a society in which
all relations between people are voluntary exchanges, a completely free market in an
underground or "counter economy" in which the State is redundant‖.
• Social Anarchism
- emphasizes social equality, community, mutual aid and the communitarian and
cooperative aspects of anarchist theory and practice;
- at its heart is the idea of Libertarian Socialism (aims to create a society without political,
economic or social hierarchies);
- the d/t forms of Social anarchism include: - -- -
Collectivist Anarchism (or Anarcho-Collectivism) is

the revolutionary doctrine, spearheaded by the Russian anarchist Mikhail
Bakunin (1814 - 1876),
– advocated the complete abolition of the state and private ownership of the means
of production,
– which would instead be owned collectively and controlled and managed by

the producers themselves.
– The revolution was to be initiated by a small cohesive elite group through acts of
violence which would inspire the mass of workers to revolt and forcibly
collectivize the means of production, and the workers would then be paid based
on the amount of time they contributed to production.
– This wage system, and the idea of collective ownership (as opposed to a complete
rejection of ownership) are the major differences between Collectivist Anarchism
and Communist Anarchism.
– Bakunin was vociferous/determined in his opposition to Communism and state

Socialism, which he regarded as fundamentally authoritarian.
 Communist Anarchism-
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– proposes a free society composed of a number of self-governing communes,

with direct democracy or consensus democracy (as opposed to representational
democracy) as the political organizational form, and related to other communes
through federation.
– The means of production would be collectively used (as opposed to collectively

owned) so that, rather than receiving payment for work done, there would be free
access to the resources and surplus of the commune.
– Anarcho-Communism stresses egalitarianism (that all people should be treated

as equals from birth) and the abolition of social hierarchy and class distinctions
that arise from unequal wealth distribution, as well as the abolition of Capitalism
and money.
– Early Anarchist Communist currents appeared during the English Civil War (1642
- 1651) and the French Revolution (1788 - 1799).
– Peter Kropotkin (1842 - 1921) and Emma Goldman (1869 - 1940) are perhaps
the best known Anarcho-Communists, although the Frenchman Joseph
Dejacque (1821 - 1864) was an earlier example.
 Anarcho-Syndicalism
– an early 20th Century form of Anarchism, heavily focused on the labor
movement.
– It posits radical trade unions as a potential force for revolutionary social change,
replacing capitalism and the State with a new society which would
be democratically self-managed by the workers.
– It seeks to abolish the wage system and private ownership of the means of
production, which they believe lead to class divisions.
– Anarcho-Syndicalists often subscribe to Communist or Collectivist Anarchism,

and the movement is more of a workplace organizational structure than an
economic system in and of itself.
– The German Rudolf Rocker (1873 - 1958) is considered the leading Anarcho-
Syndicalist theorist, and his 1938 pamphlet "Anarchosyndicalism" was
particularly influential.
6.4. Syndicalism: Meaning, Origin and Development
What is Syndicalism? Where & how did it evolved? Why did anarchists interested in
Syndicalism?
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 Syndicalism is a form of revolutionary trade unionism;
 a movement for transferring the ownership and control of the means of production and
distribution to workers' unions
 emerged first in France; spread to Italy, Latin America, the United States and, most
significantly, Spain(2mln membership support)
 Evolved as a form of revolutionary trade unionism;
 drew upon socialist ideas and advanced a crude notion of class war;
 Workers and peasants were seen to constitute an oppressed class;
 the rest were portrayed as exploiters (industrialists, landlords, politicians, judges and the
police);
Why did anarchists interested in Syndicalism?
 syndicalists rejected conventional politics as corrupting and pointless
 They saw syndicates as a model for the decentralized, non-hierarchic society of the future
(constituting grassroots democracy)
6.5. Anarchism in the twenty-first century
Q: What do U think its fate is? What is happening to this thinking today?
• is a theory that has not been materialized yet. No country has ever tried to
implement anarchism as system
• Reading Assignment
• Why do you think this was its fate?
• Identify the three major drawbacks from which anarchism was suffered as a
political movement.
Unit Seven
Fascism and Nazism

7.1. Meaning, Origin & Features of Fascism
- What is ―Fascism‖? What is ―Nazism‖?
- The term fascism comes from a Latin word, ‗fascio‘ meaning ‗bundle‘ or ‗bound
together‘
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- Fascism is an European ideology characterized by a belief in charismatic leadership,

elitism and extreme nationalism. It is a political theory that emphasizes on a unified
powerful state to which all individuals and groups submit.
- Fascism is an authoritarian Nationalist political ideology that exalts nation (and

often race) above the individual, and that stands for a centralized autocratic
government headed by a dictatorial leader, severe economic and social
regimentation, and forcible suppression of opposition.
- National Socialism(Nazism), is nothing but Germany‘s version of fascism.
Origin
• fascist beliefs date back to the late 19th century, but it was the First World War & its
aftermath that shaped it
• Fascism is commonly associated with German Nazi and Italian regimes that came to
power after World War I
• Adolf Hitler in Germany, Benito Mussolini in Italy, Francisco Franco in Spain and Juan
Perón in Argentina were well-known fascist leaders of the 20th century
• Features
* fascism is a response to a specific combination of problems that face certain societies at a

particular juncture in their historical development (problem of democracy in Itly & Ger)
*it has 'anti-character'
-anti-French Revolution ideas
-anticapitalism, antiliberalism, anti-individualism, antidemocracy anticommunism,
*core theme- the image of an organically unified national community ('strength through unity‗)
*absorbed individual identity
*a hero motivated by duty, honor and self-sacrifice, prepared to dedicate his life to the glory of
his nation or race, and to give unquestioning obedience to a supreme leader.
*Italian Fascism was essentially an extreme form of Statism that was based on unquestioning
respect and absolute loyalty towards a 'totalitarian' state ('everything for the state; nothing against
the state; nothing outside the state‗)
*German National Socialism- constructed largely on the basis of racialism. Its two core theories
were Aryanism(‗master race‘) & anti-Semitism
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*Can you mention the two principal fascist leaders who practiced fascism in Europe in this
period?
*In economics, Fascism sees itself as a third way between laissez-faire capitalism on the one
hand and Communism or Socialism on the other
Q: List down the major elements of fascism
• Nationalism - based on the cultural, racial and/or religious attributes of a region.
• Totalitarianism-state regulation of nearly every aspect of public and private sectors.
• Statism-state intervention in personal, social or economic matters.
• Patriotism -positive and supportive attitudes to a "fatherland".
• Autocracy-political power in the hands of a single self-appointed ruler.
• Militarism- maintaining of a strong military capability and being prepared to use it

aggressively to defend or promote national interests.
• Corporatism-encouragement of unelected bodies which exert control over the social and
economic life of their respective areas.
• Populism-direct appeals to the masses, usually by a charismatic leader.
• Collectivism-stress on human interdependence rather than on the importance of separate

individuals.
Q: Explain how Fascism stands against Liberalism & Democracy?
*opposition to Liberalism
-minimal interference by government
*opposition to Democracy
-fundamental values & principles of Democracy
Types of Fascism
*Italian Fascism
The authoritarian political movement (1922-1943) by Benito Mussolini; original model which
inspired other Fascist ideologies
• Nazism or National Socialism
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- the ideology and practices of the German Nazi Party (or National Socialist German
Workers' Party) under Adolf Hitler(1933 -1945)
- strongly nationalist, totalitarian, racist, anti-Semitic and anti-communist movement- grew

up due to Germany‟s humiliation in WWI blamed to Jews (belief in Superiority of
Aryan race)
* Clerical Fascism
- combines the political and economic doctrines of Fascism with theology or religious
tradition- Catholic support for the Fascist regime of Benito Mussolini
* Neo-Fascism
- Any post-World War II ideology that includes significant elements of Fascism, or that
expresses specific admiration for Benito Mussolini and Italian Fascism; & also includes
Neo-Nazi movements
Features of Fascism
Q: List & Explain major features of fascism?
• Hypernationalism
- an extreme version of nationalism(a notion that the members of one‘s nation (or people) must
act together to achieve certain collective goals)
- the nation is exalted as the supreme political value
- national glory and self-assertion assume the highest priority (acts of Mussolini & Hitler)
• Racism (ideology based itself on hatred of other peoples)
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- Concepts of racial purity(pure-blooded) and superiority was a central tenet of Nazi doctrine
resulting in Holocaust of Jews
• Totalitarianism (demand for the existence of a powerful and

unified state)
- regards the state as an organic unity that subsumes all divisions
- Totalitarianism is an exceptionally intrusive form of authoritarianism in which the state

monopolizes control not only over all institutions of government but also over the
individual (private life), educational system, the media, science, and the arts
- willing to permit private firms to do business but these businesses were subject to all
sorts of state regulations through ―corporations,‖
- All divisions and diversity is taken as anathema/curse
- Believe as ‗it is in war that the nation is most united, disciplined and possessed of sense
of purpose and national pride‘
- Any questioning or criticizing of the government is considered treasonous and is punished by

death
National Socialism/Nazism (German version of fascism)
- Nazism is said to be Fascism taken in to its extreme form. Being Racist and anti-Semitic
elements signify how extreme it was.
Q: Does fascism appreciate intellectuality and knowledge?
• Fascist‘s ideas and methods tend to be intellectually crude or rudimentary.
• Indeed, they despise intellectuals and sophisticated theory.
• Instead, they stress on instinct/nature, emotion, will and above all action.
• As a consequence, fascism is widely understood as a return into barbarism and a denial of

basic values of civilization.
Q: What were factors contributed for the success of fascism among Germans?
• Economic Depression
• The rise of communism
• The destruction of traditional German culture
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• The weakness of liberal republicanism
Major Principles of Fascism
- It stands for omnipotent state(unlimited sovereignty of the state over all spheres). The authority
of the state is absolute, unlimited and indivisible. Individuals should worship the state
- Democracy is a luxury for rich nations of the world
*there is no place for opposition of any kind
*Freedom of expression and thought is banned and any organized political party or social group
is outlawed.
- A fascist state is not the state of people;
- It promotes the idea that sovereignty is vested in the nation and its exercise is in the
hands of a small section of a ruling party or junta (elite formed around the personality of
a charismatic leader)
- Fascism has no fundamental doctrinal basis (It is essentially empirical and practical)
- Establishment of corporatist state, a realization of autarky and economic self-sufficiency

of the nation (skewed towards the capitalist‘s ideology with heavy state involvement)
- Fascism is anti-socialism, anti-communism and always advocates war and violence; anti-
pacifisim
7.2. Giovanni Gentile and His Fascist Philosophy
• Gentile is the intellectual father of fascist ideology
• served as the party‘s chief theorist and minister in Mussolini‘s fascist government
• Hegel‘s dialectical philosophy influenced Gentile
• divided human nature into two identities: Particular will (private) & universal will(of
nation, heritage)
• individual knows himself by recognizing the universal will within him(obedience to the
state is the fulfillment of the individual)
• It is natural for the stronger to conquer the weaker
• Gentile‘s fascism favored the traditional family and religion (could teach people about
loyalty, devotion and sacrifice outside the ―self‖)
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• In fascist society, the state becomes a kind of God, demanding absolute obedience and
submission
Unit Eight
Contemporary Political Thought

Contents
- The Essence of the Theory of Justice
- Rawls‘ Conception of Justice
- Principles of Justice
- The Original Position and Just

Institutions
- The Basic Structure of Society
- Liberation Philosophy
*The Theory and Practice of Civil

Disobedience
*Feminism
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8.1. John Rawls‟ Theory of Justice
1. The Essence of the Theory of Justice
1.1. Rawls‟ Conception of Justice

Q: Who was John Rawls? What does he did?
- an American philosopher, the most important political philosopher of the 20th century
- wrote a series of highly influential articles (helped refocus Anglo-American moral and
political philosophy on substantive problems)
- His first book, A Theory of Justice (1971), revitalized the social-contract tradition
- In Political Liberalism (1993), he recast the role of political philosophy
- Rawls takes the basic structure of society as his subject matter and utilitarianism as his
principal opponent
- The first part of the Theory of Justice designs a social-contract-type thought experiment,
the Original Position
- The second part of the Theory of Justice checks the fit between the principles of Justice
as Fairness and our more concrete considered views about just institutions
- The third part of the Theory of Justice addresses the stability of a society organized
around Justice as Fairness
Q: What is the concern of the theory of justice in Rawls‘ view?
- Rawls theory of justice refers to social justice, whose major subject is the basic structure of
society, i.e. the way in which major social institutions distribute fundamental rights and duties
and determine the division of advantages from social cooperation.
• Rawls conception of justices generalizes the social contract theory of Lock and Rousseau.
- his idea is that the principles of justice for the basic structure of society are the objects of
the original agreement
- These are principles that free and rational persons would accept to further their own
interests in an initial position of equality
- These principles determine all further agreements and they specify the kinds of social
cooperation that people can enter into and the type of government that people should
form.
- It is this way of regarding the principles of justice that Rawls calls Justice as Fairness.
Justice as Fairness is thus offered to people who are neither saintly altruists nor greedy
egoists.
- We are, as Rawls puts it, both rational and reasonable. We have ends that we want to
achieve, but we are happy to achieve them together if we can, in accord with mutually
acceptable regulative principle
Q: What are the major principles of justice that we would agree to if we desire to cooperate with
others?
- Rawls bases this ―justice as fairness‖ on two principles of justice:
- 1. That each individual has the right to the most extensive liberty (of speech, religion,
property, movement) compatible with the equal liberty of everyone else, and
- 2. That any social and economic inequalities of wealth and position are arranged so that
the result is a greater benefit to the least advantaged and that all high positions are
democratic and open to all people through equal opportunity.
- Each of these centrally addresses a different set of primary goods: the First Principle
concerns rights and liberties; the principle of Fair Equality of Opportunity concerns
opportunities; and the Difference Principle primarily concerns income and wealth.
- *For Rawls the first principle is more important than the second because he believes that
equal basic liberties cannot be sacrificed for greater economic and social benefits.
- Rawls held that these principles of justice apply to the ―basic structure‖ of fundamental
social institutions (courts, markets, the constitution, etc)
- Rawls further argues that these principles were to be lexically ordered, thus giving
priority to basic liberties over the more equality-oriented demands of the second principle
- The society that best takes care of the least advantaged (Rawls‘ ―maximin strategy‖, i.e.
maximizing the minimum) is a mixed economy: free-enterprise capitalism with extensive
government regulation for the common good and with social-welfare liberalism. Why?
Q: What kinds of principles of liberties are forwarded by Rawls?
- 1st. Rawls argues that we would affirm a principle of equal basic liberties, thus protecting
the familiar liberal freedoms of conscience, association, expression, and the like (notably
absent are liberties associated with property ownership and contractual exchange).
- 2nd. Principle requires fair equality of opportunity, paired with the famous (and
controversial) difference principle. This ensures that those with comparable talents and
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motivation face roughly similar life chances, and those inequalities in society work to the
benefit of the least advantaged.
2. The Original Position and Just Institutions
2.1. The Basic Structure of Society
Q: What Rawls meant by ‗Basic Structure of Society‘?
…―the way in which the major social institutions fit together into one system, and how they
assign fundamental rights and duties and shape the division of advantages that arises through
social cooperation.‖
Q: Why he used this institution?
- To reduce defects in many institutions
- to organize society around fair principles of cooperation
- To put all efforts together so that the rules of the game are fair
2.2. The Original Position
As thought by Rawls, What is the Original Position?
- Is a hypothetical situation developed by John Rawls as a thought experiment to replace the

imagery of a savage state of nature of prior political philosophers such as Thomas Hobbes, John
Lock and Jean Jacques Rousseau.
- In Rawls‘s theory of Justice as Fairness, the Original Position plays the role that the state
of nature does in the classical social contract tradition.
- The Original Position is hypothetically designed to accurately reflect what principles of

justice would be manifest in a society premised on free and fair cooperation between
citizens, including respect for liberty, and an interest in reciprocity.
- He assumes that Original positions fills the gap in Social contract (gov‘t power is limited)
with representatives of citizens, being placed behind a ―veil of ignorance‖(w/c assures
that each party to the choice is equally placed with no one enjoying greater advantage
over the other
- Rawls specifies that the parties in the Original Position are concerned only with citizens‘
share of what he calls primary social goods, which include basic rights and liberties,
economic and social advantages or opportunities such as wealth.
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- Rawls also argues that the representatives in the Original Position would adopt the
maximin rule as their principle for evaluating the choices before them (making the choice
that produces the highest payoff for the least advantaged position, representing
formulation of social equality)
- 2.3. Just Institutions
Q: What does the idea of just institution imply?
- Implying the moral arbitrariness of fortune, Rawls argues that ―The natural distribution is
neither just nor unjust; nor is it unjust that persons are born into society at some particular
position. These are simply natural facts. What is just and unjust is the way that
institutions deal with these facts.‖
Q: Is it reasonable to Rawls to say getting what one deserves is a direct basis for
distributional claims?
- - He says no! He suggests that it is much more reasonable to hold that whether one
deserves the compensation one can command in the job marketplace, for instance,
depends on whether the basic social institutions are fair. Are they set up so as to assure,
among other things, an appropriate relationship between effort and reward?
8.2. Liberation Philosophy
8.2.1. The Theory and Practice of Civil Disobedience
The Origin of Civil Disobedience Theory
• Mohandas Karamchand Gandhi (1868-1948),
- he was an opponent of racial discrimination
- he became an active figure in his country‘s nationalism
- In India in 1914, he became a leading figure in the cause of Indian nationalism but
assassinated by a Hindu extremist in 1948
- Gandhism cannot be identified with any school of western political philosophy
- Gandhi‘s place in the world of political theory is unique.
- The value of his social, political and economic ideas provides moral goals for people who
aspire to realize changes
Q: What is civil disobedience?
- The philosophy of civil disobedience goes back to classical and biblical sources
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- the medieval philosophers who advocated the principle of loyalty to the Higher Law
(God‘s law) even by violating civil laws
- modern origin dates back to an American writer, Henry David Thoreau
- He is the first to coin the term civil disobedience in his essay entitled On Duty of Civil
Disobedience in 1849
- Thoreau stated that he protested government law by refusing to pay tax due to his
opposition against the institution of slavery in the south.
- He argues that any failure to protest unjust laws was effectively contributing to that
injustice.
- He claims that the individuals, who grant the state its power in the first place, must follow
the dictates of conscience in opposing its unjust laws.
- Thoreau characterized a law unjust based on the following elements:

- When a law is degrading to human beings. The law that permits slavery and allows
torture of prisoners of war is degrading to humans
- When it is discriminatory. Laws that apply to one group but not to another are unjust. The
laws of Apartheid in South Africa until the 1990s and the caste system in India are
discriminatory
- When it is enacted by an authority that is not fully representative.
- When it is unjustly applied, that may harass the other
• Thoreau‘s work had an enormous impact on Gandhi and he practiced to the extent of
liberating India from British
• The Essence of Civil Disobedience
Q: How M. Gandhi associate civil disobedience with Hindu belief?
- Gandhi‘s belief was mainly in satya, which he calls Truth, Spirit or God.
- He maintains that satya is a principle of the universe that is applicable to humans and
non-humans.
- This finds its root in the Hindu belief that a supreme intelligence or truth rules the
universe.
- Gandhi assumed that as human beings are part of a whole through satya, all differences
of race, culture, class, religion and geography are irrelevant.
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- He argued that the only justified and proper relationship between human beings is that of
love (compassion), i.e. unconditional concern for the welfare and happiness of others.
- It is this love that implies his principle of non-violent action in fighting against socio-
economic and political injustices.
- The achievement of moral and political goals through love is what he called satyagraha,
i.e. non-violent action.
- The use of civil disobedience proved that armed and violent revolution was not necessary
to change society.
- The civil rights movement of the United States in the 1960s used it as a model.
- Gandhi believed that mankind could eliminate all moral weaknesses.
- In an attempt to avoid moral weaknesses, he used to sleep with many women naked to
test his capability of resisting sexual impulses.
- His beliefs rest on the assumption that all bodily desires are moral degradations and
submission to material wants.
- He argued all desires beyond sustenance of life are bad.
- For him, goodness implies the avoidance of sensual and worldly sphere.
- Gandhi also disregarded Western civilization as based on unlimited material desires.
- He believed that western civilization resulted in alcoholism, prostitution, drug use,

accumulated wealth and unnecessary pride.
- As a result, he avoided even wearing factory-made clothes, preferring local hand-made

goods.
- Gandhi always wanted India to grow by using its traditions and rural and indigenous
agricultural system, rather than applying the Western model of growth.
Q: What is Civil Disobedience?
- By definition, civil disobedience is the refusal of an individual or a group to obey a law

or follow a policy, which is unjust, for moral, religious or other reasons.
- Practitioners of civil disobedience usually employ the non-violent technique of passive

resistance.
- Non-violence implies the positive quality of doing good to others rather than simply
refraining from doing bad
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- Risking punishment or imprisonment, they attempt to bring about changes in the law.
- The major techniques of civil disobedience are: demonstrations, marches, hunger strikes,
the occupying of buildings, blockades, sit-ins and strikes and other forms of economic
resistance. - - Gandhi‘s theory of civil disobedience became highly successful in India‘s
independence struggle.
• The Nature and Role of the State
- On Gandhi‘s account of the true essence or nature of mankind, the state, as we usually
encounter it, is the antithesis of how human beings should be organized.
- The state, through the use of its machinery, institutionalizes violence.
- Gandhi argues that the state encourages dependence and undermines self-reliance of
individuals.
- In other words, the state dehumanizes human beings. However, at the same time, he
recognized that mankind could not live without government.
Q: How then should society organize government so as not to be inimical to the real nature of
man?
- Gandhi‘s answer is that the state should be a minimal in its organization, which is non-
coercive and gives its citizens maximum freedom to develop their potentials and talents
with self-respect.
- This kind of state, he believed, commits itself to the development or improvement of all
human beings rather than a ruling class or the favored few.
- The state should be organized in such a way that there are self-governing communities
ruled by custom at local level.
- These small villages elect their representatives for districts, which in turn elect their own
representatives, provincial representatives.
- This kind of state would consist of small and self-governing villages, which can be
effective in realizing the goal of common moral values without coercion.
- There would be decentralization of authority.
- Based on this, the state operates through persuasion and understanding.
• Interestingly, Gandhi suggested that no mistake should be considered as a crime.
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- He held the view that what government call ‗crimes‘ are simply ‗social illness‘, which
society can cure.
- He even argued that the state should not punish individuals for committing ‗crimes‘.
- He stated that punishment is not the right solution because the only corrective mechanism
to such kind of illness is enlightening those who commit the mistakes and giving them
help.
• Although he favored majority decision, Gandhi feared about tyranny of majority. He,
however, suggested two remedial measures:
*The proper representation of minorities, and;
*The inalienable right of individuals to civil disobedience in cases when governments force them
to act contrary to their conscience. Denying such rights to individuals violates the moral nature
of humanity at all, he supposed.
• He was also critical of parliamentary democracy and rejects parliament as an institution

comprising of self-interest seekers serving as a ‗talking shop‘.
- He rather preferred a new social and political order that ensures complete justice and
equality.
- In his view, the state continues to exist as an institution but not as an organized institution
of coercion.
- State institutions such as the army, the police, bureaucracy, courts, and industry would
continue for the sake of common welfare.
• Gandhi‘s theory may be criticized.
- His emphasis on the goodness of man is refutable because he has considered one side of
human nature only.
- Besides, his characterization of the state as an instrument of exploitation and oppression

reflects only part of the reality because the state also provides citizens protection and
welfare.
• Gandhi disapproved private property in as far as it involves exploitation and inequality,

which accords primacy to material desires.
- But, he concedes that since private property is an established fact everywhere, it would
not be feasible to abolish it.
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- Instead, Gandhi suggests that the rich should hold their property in trust for community,
taking from it what they need and distributing the surplus to the poor.
- Later on, however, Gandhi was realistic enough to realize that his initial expectation
might not work in reality unless the state distributes wealth to the poor through taxation,
restriction on the rights of inheritance and nationalization of land.
8.2.2. Feminism
Definition and Essence of Feminism
• Feminist aspirations underpinned after the publication of Mary

Wollstonecraft's A Vindication of the Rights of Women ([1792]
• it was not until the emergence of the women's suffrage movement in the
1840s and 1850s that feminist ideas reached a wider audience, in the form
of so called 'first-wave feminism‗
• 'Second-wave feminism', however, emerged in the 1960s. This expressed

the more radical, and sometimes revolutionary, demands of the growing
Women's Liberation Movement (WLM).
As such, Feminism is a social ideology associated with the women‘s movement in the Western
world during the 19th and 20th centuries.
Although a diverse movement, feminists generally agree on three propositions:
• Men and women are fundamentally equal in rationality and ability;
• Society has historically denied women‘s equality with men prevented women from
fulfilling their human capacities; and
• Women should engage in political activities to secure legal, political and economic
equality with men.
Strands of Feminism
a) Liberal feminists(‗equal-right feminism‘)
The most important tenets of liberal philosophy was individualism
• has been concerned with equal rights for women which include achieving
equal economic opportunity in education, employment and professional
advancement; equal pay for equal work and getting equal access to
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traditional male-dominated professions such as law, medicine, and clergy,

military and executive and administrative positions
• they never tried to transform society, but, they seek to establish equality
with men within the existing social order. Legislation is the main means of
achieving their objectives.
• The concern for equal status of women has led to the adoption of various
social policies in the West such as:
– Divorce laws
– Birth control policies
– Abortion rights, and
– Lesbian rights
b) Socialist Feminism
• In contrast, socialist feminists typically highlight the links between female subordination
and the capitalist mode of production, drawing attention to the economic significance of
women being confined to a family or domestic life where they, for example,
- relieve male workers of the burden of domestic labor,
- rear and help to educate the next generation of capitalist workers, and
- act as a reserve army of labor.
c) Radical Feminists (―difference‖ feminism)
- considers women to be different from men and superior to them.
- belief that men are responsible for and benefit from the exploitation of women
- They often concentrate on the family as one of the primary sources of women‘s
oppression in society
- critics the liberal notion of legislative reform
- engaged in direct action and political opposition aiming at challenging the existing socio-
political order such as capitalism, private property, religion and patriarchy
- argue that women can be emancipated only through the abolition of the family and the
power relations that characterize it. Radicalists argue for the overthrow of patriarchy
through
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• Not engage in sexual relationship with men,
• to reclaim power over sexual reproduction (for example through the use of technology
such as artificial insemination),
• to provide and organize in women-only organizations.
Conclusion On Feminism
• The underlying themes of feminism are therefore, first, that society is characterized by
sexual or gender inequality and, second, that this structure of male power can and should
be overturned.
• Feminist theory also argues that the current system fails to promote the interests and roles
of women in the world community.
• By ignoring women`s contribution and issues, the history and present system of as well
as the approach to international politics is considered as one-sided, masculinity and not
fully representative.
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COURSE 9: PUBLIC POLICY MAKING AND ANALYSIS
Unit One:
Concepts of Public and Policy
1. Concepts of Public and Policy

Before having a look at public policy, lets have brief discussions about policy and the
public. In most cases, the term policy is used to indicate the behavior of some actor or set
of actors (l.e. official, governmental agency, or legislatures) in an area of activity with
public values. However, the historical root of policy comes from its etymological
definition. The word policy comes from the Greek, Sanskrit, and Latin Languages.
Indeed the Greek and Sanskrit root from polis (city-state) and Pur (city) evolved into the
Latin Politia (state) and later into police, which is the English word.
The policy is a broader notion than a decision because the policy covers a bundle of
decisions. More generally, it reflects an intention to decide in a particular way.
Policies consist of courses or patterns of action taken over time by governmental officials
rather than their separate, discrete decisions. A policy includes not only the decision to
adopt a law or make a rule on some topic but also the subsequent decisions that are
intended to enforce or implement the law or rule. Industrial, health and safety policy
A policy is defined as a relatively stable, purposive course of action followed by an actor

or set of actors in dealing with a problem or matter of concern. This definition focuses on
what is actually done instead of what is only proposed or intended; differentiates a policy
from a decision which is essentially a specific choice among alternatives; and views
policy as something that unfolds over time.
 Policies are mechanisms that are arranged to achieve specific goals.
 Policies are expected to show coherence (policy as a strategy), hierarchy (policy
as an institution to staff) and instrumentality (policy as a purpose).
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POLICY AS AN EXPRESSION OF GENERAL PURPOSE OR DESIRED STATE

OF AFFAIRS. State of policy in this context expresses the broad purposes (or ―ends‖) of
governmental activity in one field and also describes the state of affairs which would
prevail on achievement of those purpose;
POLICY AS SPECIFIC PROPOSALS. The statements of specific actions which

political organizations (interest groups, parties, the Cabinet itself) would like to see
undertaken by government;
POLICY AS DECISIONS OF GOVERNMENT. Most of the times Political Scientists

tend to focus on case study of government decisions, They may take a larger view of
policy-making, looking for broader patterns of related decisions and taking into account a
longer time span which should certainly extend to what happens after the moment of
choice and to questions of implementation and actual outcomes. However, policy is
larger than decision because it usually involves a series of more specific decisions. While
one decision in the sequence may be seen as crucial, an understanding of the larger policy
requires some study of decisions.
POLICY AS FORMAL AUTHORIZATION. When it is said of government that it has

a ―policy‖ on a particular topic, the reference is sometimes to the specific Act of
Parliament or statutory instrument which permits or requires an activity to take place. Or
it may be said when legislation is enacted that the policy is to be carried out or
implemented;
POLICY AS A PROGRAMME. Most American students refer to policy as

programmes. A programme is defined as relating to specific sphere of government
activity involving a particular package of legislation, organization and resources. For
example, government policy can be said to consist of a number of programmes, such as:
the provision of subsidized council houses, a housing improvement programme, an
option mortgage programme, and so on. Programmes are usually seen as being the means
by which governments pursue their broader purposes or ends.
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POLICY AS OUTPUT. Here, policy is seen as what government actually delivers as

opposed to what it has promised or has authorized through legislation. Such outputs can
take many forms – the delivery of goods or services, the enforcement of rules, or the
collection of taxes. The form of outputs varies between policy areas. It is sometimes
difficult to decide what the final ―output‖ of government policy is in a particular area. For
example, in the health service, there is a tendency to describe such items as more funds,
more trained staff, and more beds as the outputs of a policy intended to improve the
quality of medical care. In fact, these are necessary but not sufficient conditions of
improved medical care: they should be regarded as important contributory factors to the
desired output, but not the output itself. They could perhaps be described as ―intermediate
outputs‖ rather than the final or ―ultimate‖ output.
POLICY AS OUTCOME. Another way of looking at policy is in terms of its outcome,

that is, in terms of what is actually achieved. This distinction between outputs (the
activities of government at the point of delivery) and outcomes (the impact of these
activities) is often slurred over, and is sometimes difficult to make in practice, but it is an
important one. Thinking of policy in terms of outcomes may enable us to make some
assessment of whether the stated purpose of a policy is compatible with what the policy is
actually achieving. It will also enable us to focus on the impact of the delivery of that
policy to the targeted population
POLICY AS A THEORY OR MODEL. All policies involve assumptions about what

governments can do and what the consequences of their actions will be. These
assumptions are rarely spelt out, but policies nevertheless do imply a theory (or model) of
cause and effect.
POLICY AS A PROCESS. Policy involves a process over a much longer period of

time. It could begin from the statement of an objective, moment of decision or approval,
implementation and evaluation.
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Furthermore, a policy may be general or specific, broad or narrow, simple or complex,

public or private, written or unwritten, explicit or implicit, discretionary or detailed, and
qualitative or quantitative.
What is public? The concept of public policy presupposes that there is a domain of life which is
not private or purely individual, but held in common. It is important to understand the concept of
―public‖ for a discussion of public policy. We often use such terms as ―public interest‖, public
sector‖, ―public health‖ and so on. The starting point is that
―Public policy‖ has to do with those spheres which are so labeled as ―public‖ as opposed
to spheres involving the idea of ―private‖. The concept of public policy presupposes that
there is an area or domain of life which is not private or purely individual, but held in
common. The public comprises that domain of human activity which is regarded as
requiring governmental intervention or common action
1.2 Definitions in Public Policy
The systematic study of public policy began nearly half a century ago. The discipline of
public policy emerged as an important field in the early 1950s with pioneering work of
Harold Lasswell. In the mid-60s the works of David Easton also provided an intellectual
framework for understanding of the entire policy process.
Some scholars pointed out the difficulty of finding a single neat phrase to define the
concept of public policy. Therefore, there is no universally accepted definition of public
policy. However, some scholars have provided certain definitions which enable us to
have conceptual understanding about public policy.
Dye (1995) define public policy as what government choose to do or not to do. This
definition of public policy clearly shows that government is the agent of public policy
making and it highlights the fact that policies involve fundamental choice on the part of
the government to do something or not to do.
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The policy of government can be defined as its programme of action to give effect to
selected normative and empirical goals in order to address perceived problems and needs
in society in a specific ways and therefore to achieve desired changes.
Anderson(1997) on the other hand describes public policy as a relatively stable,

purposive course of action followed by an actor or setoff actors in dealing with a problem
and matter of concern. Anderson‘s definitions somehow differ than dye‘s definition
because it stress that set of actors rather than sole actor,(government) take policy
decisions. And it also highlights the link between the government action and a perceived
problem or concern that needs government action.
Dror (1968) offers more comprehensive definition of public policy. It‘s a more complex,
dynamic and continuous process whose various components make different contributions
to it. It decides major guidelines for actions directed at the future mainly by government
organs. This definition contains the essential elements of public policy.1) it stress that
public policy making involves structures or components and its an ongoing process
taking place with in governmental institutions. 2) depend on the nature and structure
policy and policy systems institutions (legislature, executive, judiciary ) make different
contribution to public policy making.3) it asserts that public policy decisions are
legislative enactment that can be made by public institutions.
Saasa (1985) states that public policy is not only a conscious goal selecting process
undertaken by actors in the political process, but also it includes the identification of
means for achieving such public goals.
 Public policy is designed to accomplish or produce definite result.
 Public policy should distinguish between what governments intended to do and
what they actually do, policy involves what governments actually do, not what
they intended to or what they say they are doing
 Public policies are enacted and enforced by governmental institutions and actors.
 Public policy involves all level of actors, and is not necessarily restricted to
formal actors
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 Numerous government structures and institutions contribute to policy making

 Public policy is an ongoing process
1.3 The scope and nature of public policy
Public policy is what government chooses to do or not to do. It is government actions or
proposed course of action directed at achieving certain goals. Its scope includes variety of
areas and issues, such as: economy, education, health, defense, social welfare, foreign
affairs, transportation and housing. Policy analysis is the study of public policy. It is the
study of the causes, processes, formation, implementation and consequences of public
policy.
1.4 NATURE OF PUBLIC POLICY
Prior to the revolution propounded by the Behaviouralists, the study of Political Science
was largely dominated by the Traditionalists who borrowed a lot from the historical
method of analysis (descriptive method). Consequently, the pre-Second World War
political scientists did not concern themselves with the scientific study of events.
However, there has undoubtedly been an increased interest over the past twenty years in
the analysis of policy as a focus. This increased interest has been accompanied both by
grandiose claims for how ―policy science‖ can improve the decision-making capacity and
the outputs of government, and imitative relabeling as ―public policy‖ of traditional
courses in government or public administration.
In the past, studies on public policy have been mainly dominated by scholars of political
science and public administration and have tended to concentrate more on the content of
policy, the process of its formulation and its implementation. The study of public policy
has evolved into what is virtually a new branch of the social sciences- the so called policy
sciences (Dror, 1968:8-9). This concept of policy sciences was first formulated by Harold
Lasswell in 1951. Today, the policy sciences have gone far beyond new and naïve
aspirations for societal relevant knowledge.
―Policy science is a new supra-discipline, oriented towards the improvement of policy-

making and characterized by a series of paradigms different in important respects from
contemporary normal sciences‖.
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Policy Science was conceived as a supra-discipline – which will integrate several

disciplines, such as: Political Science, Public Administration, Economics, Psychology,
Sociology and tools of operational research and build multi-disciplinary knowledge,
skills and techniques to resolve social problems. It is aimed at improving the knowledge,
methods and analysis in policy making.
1.5 Policy Types and Its Classifications
1.5.1 Classification of Public Policies

Governments at all levels are involved in a large number and complexity of public
policies. These policies are classified by political scientists and others according to
various categories of policies. Although these categories are convenient for designating
various sets of policies and organizing discussions about them, they are not helpful in
developing generalizations, because they do not reflect the basic characteristics and
content of policies. Policies may be classified as either substantive or procedural.
1.5.1.1 SUBSTANTIVE POLICIES
Substantive policies involve what government is going to do, such as constructing
highways, paying welfare benefits, acquiring bombers, or prohibiting the retail sale of
liquor. Substantive policies directly allocate advantages and disadvantages, benefits and
costs, to people.
1.5.1.2 PROCEDURAL POLICIES
Procedural policies, in contrast, pertain to how something is going to be done or who is
going to take action. So defined, procedural policies include laws providing for the
creation of administrative agencies, determining the matters over which they have
jurisdiction, specifying the processes and techniques that they can use in carrying out
their programmes, and providing for presidential, judicial and other controls over their
operations. However, procedural policies may have important substantive consequences.
That is, how something is done or who takes the action may help determine what is
actually done. Frequently, efforts are made to use procedural issues to delay or prevent
adoption of substantive decisions and policies. For example, an agency‘s action may be
challenged on the ground that improper procedures were followed.
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1.5.2 POLICY TYPES

Differentiating policy according to its types explains the effect of such policy on the
society and the relationships among those involved in policy formation. Lowi (1972:298-
310) suggests a classification of policy issues in terms of being:-
(i) distributive,
(ii) regulatory,
(iii)redistributive, and
(iv) Constituent policy issues.
Sometimes self-regulatory
1.5.2.1 DISTRIBUTIVE POLICY
Policy issues concerned with distribution of new resources are distributive policies.
Distributive policies involve allocation of services or benefits to particular segments of
the population – individuals, groups, corporations, and communities. Some distributive
policies may provide benefits to one or a few beneficiaries. The policies involve using
public funds to assist particular groups, communities, or industries. Those who seek
benefits usually do not compete directly with one another.
1.5.2.2 REDISTRIBUTIVE POLICY
Redistributive policy issues are those which are concerned with changing the distribution
of existing resources. Redistributive policies involve deliberate efforts by the government
to shift the allocation of wealth, income, property, or rights among broad classes or
groups of the population, such as: haves and have-nots, proletariat and bourgeoisie.
Redistributive policies are difficult to enact because they involve the reallocation of
money, rights, or power. Those who possess money or power rarely yield them willingly,
regardless of how strenuously some may discourse upon the ―burdens‖ and heavy
responsibility attending their possession. Example of re-distributive policy is graduated
income tax or taxing the wealthy to allocate resources to the poor.
1.5.2 .3 REGULATORY POLICY
Regulatory policy issues are those which are concerned with regulation and control of
activities. Regulatory policies impose restrictions or limitations on the behavior of
individuals and groups. That is, they reduce the freedom or discretion to act of those
regulated, whether utility companies, or agencies. When we think of regulatory policies,
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we usually focus on business regulatory policies, such as those pertaining to control of

pollution or regulation of transportation industries. Among others, these sorts of policies
were the focus of the movement for deregulation. The most extensive variety of
regulatory policies, however, is that which deals with criminal behavior against persons
and property. Examples of regulatory policies are: consumer protection policies,
NAFDAC, SON, NDLEA, policies that regulate entry into businesses-National
Communication Commission, Federal Character Commission, PHCN regulatory policies
etc.
1.5.2.4 Self-Regulatory
Self-regulatory policies are similar with that of regulatory policy in that they involve the
restriction and control of some matter or group. Unlike regulatory policy, however, self-
regulatory are usually sought, supported and controlled by the regulated group as a means
of protecting and promoting the interests of its members.
1.5.2.5 CONSTITUENT POLICY

Constituent policy issues are those which are concerned with the setting-up or re-
organization of institutions. Each of these policy issues forms a different power arena.
1.5.2.6 MATERIAL AND SYMBOLIC POLICY
Public policies may also be described as either material or symbolic, depending upon the
kind of benefits they allocate. Material policies actually either provide tangible resources
or substantive power to their beneficiaries, or impose real disadvantages on those who are
adversely affected. Legislation requiring employers to pay a prescribed minimum wage,
appropriating money for a public-housing programme, or providing income-support
payments to farmers is material in content and effect.
Symbolic policies, in contrast, have little real material impact on people. They do not
deliver what they appear to deliver; they allocate no tangible advantages and
disadvantages. Rather, they appeal to people‘s cherished values, such as: peace,
patriotism and social justice. The material – symbolic typology is especially useful to
keep in mind when analyzing effects of policy because it directs attention beyond formal
policy statements. It also alerts us to the important role of symbols in political behavior
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1.6 Significance and why study Public Policy

Political scientist usually most concerned with political institutions, like legislature or
international organizations, with political process like judicial and electoral processes,
and elements of political systems such as public opinion and interest groups. However, it
doesn‘t mean that they are not totally concerned with public policy. Foreign policy and
civil rights and liberties policies have traditionally been viewed as appropriate for their
attention. These too has what professor Robert H. Salisbury calls constitutional policy or
decisional rules by which subsequent policy actions are to be determined. Each helps to
shape decisions and public policy. Therefore some political scientists with normative bent
are also concerned with what government should do with the nature of correct and proper
public policies.
Students of public policy usually seek answers to such questions as the following: what
effect do urbanization and industrialization have on welfare policies? How does the
organization of congress help shape agricultural or welfare policies? What role do
interest groups play in environmental policy formation? Who does and doesn‘t benefit
from current tax policies? What are the problems in implementing hazardous waste
disposal program? Although these questions are often difficult to answer, especially with
precision, they direct our attention to the actual operation of the policy process and its
societal consequences.
Generally there will be one response which is very important for the question why we
study public policy? That is, we all affect and get affected (positively and negatively) by
public policy and thus we should know something about them. However, far beyond this
we need systematic responses for why we study public policy? So this can be framed in
terms of scientific, professional, political reasons for studying public policy.
Scientific Reasons
Public policies can be studied for gaining greater understanding of their origin, the
process by which they are developed and implemented and their consequences for the
society. This in turn increases our understanding of the political process and political
behaviour. Policy may be regarded as either a dependent or independent variables for this
sort of analysis. When it is viewed as a dependent variable, as a product of various
political factors, attention is focused on the environmental and political factors
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contributing to its adoption and content. For instance how is policy affected by the
distribution of power among various levels of government? Were pressure groups and
public opinion important in the adoption of a policy? If public policy is viewed as
independent variable our focus shift to the impact of policy on the nature and operation of
political process and its environment. One may then seek answers to such questions as
these. How does policy affect/support for political system? What effects does policy have
on social wellbeing? Does policy making vary depending upon the kind of policy
involved?
Professional Reasons
Don K. Price draws a distinction between the ―scientific estate‖ which seeks only to
discover knowledge and the ―professional estate‖ which strives to apply the scientific
knowledge to the solution of practical social problems. Here we encounter those
practitioners of policy analysis whose numbers both inside and outside the government
have multiplied greatly in the years. Policy analysis has a practical orientation and is
concerned with determining the most efficient or best alternative for dealing with the
current problems, such as reduction of air pollution or the collection of household
garbage. A variant policy analysis is evaluation research, which assess the societal effects
of particular public policies. The policy evaluator wants to know, for instance, whether a
job training program increases the employment prospects and earnings of its enrollees
and if so, by how much.
Policy analysis relies heavily upon the economic theory and statistical and mathematical
techniques. Cost benefit analysis, for example, is widely used in determining the
efficiency of the proposed alternatives or actual policies. In appraising the efficiency of
government actions, the policy analysis is concerned with their impact on society
generally, on whether society as a whole gains or losses, rather than their distributional
consequences. Which particular groups receive the benefits and which pay the cost of a
policy are not of a real concern. In sum professional policy analysis tries to identify and
adopt good public policies as measured by the efficiency criterion.
Political Reason
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Some political scientists don‘t believe that Political scientists should strive to be neutral
or impartial in the study of public policy. Rather they concerned that the study of public
policy should be directed toward helping to ensure that governments adopt favoured
public policy to attain the right goals. They reject the notion that policy analysts should
strive to be value free, contending rather that political science should not be silent or it is
important on how to deal with current political and social problems. They engage in
policy advocacy and are undeterred by the substantial disagreement in society over what
constitute correct policy or the right goal of policy. Research engaged by policy is often
skewed by the desire to develop evidence to support their cause. Policy study in contrast
is motivated by the intent to impartial.
Chapter Two
Policy Analysis
2.1 Meaning and Issues of Policy Analysis
Policy analysis is principally concerned with describing and investigating how and why
particular policies are proposed, adopted, and implemented. This is the theoretical side of policy
studies. A policy option must be evaluated in the light of what policy analysis reveals about its
chances of being adopted, the probable effectiveness or impact of the option, and the difficulties
of implementation.
Policy analysis is not, however, value neutral. Policies analysts want to discover which policy
proposals best fulfill important public values. Thus, policy analysis invokes such principles as
freedom, equality, justice, decency, and peace. Indeed, politics often concerns debates about the
very meaning of these terms.
Those who would sharply separate policy analysis from fundamental social values make a grave
mistake. Policy analysis without awareness of ethical perspectives is incomplete. This is
particularly true when evaluating the impact of policy. Ethical principles must be brought to bear
on the discovery of the good and bad effects of policy. Such principles not only measure success
and failure; they also provide insight into consequences that otherwise would not be revealed.
Policy analysis carried out by political scientists can be distinguished from policy advocacy by
politicians, partisans, or interest groups. Advocacy differs from analysis, because advocacy
begins with a commitment to economic interests or to principles as interpreted by specific
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ideological systems, such as liberalism, conservatism, and environmentalism. Analysis should

better equip policymakers to make policy choices while advocacy attempts to impose such
choices on others. Nevertheless, both advocacy and analysis draw upon similar principles and
goals, and the two intertwine in the real world of politics. Although ideological commitments can
bring important overlooked values to policy analysis, policy advocates are more concerned to
advance their ideology than to understand the policy process, which is the goal of policy
analysis.
Public Policy analysis, therefore, has been variously defined by scholars. Quade (1975), says it is
―any type of analysis that generates and presents information in such a way as to improve the basis
for policy-makers to exercise their judgment‖. On his part Chandler and Plano, (1988:96) posit that
policy analysis involves ―systematic and data-based alternative to intuitive judgments about the
effects of policy or policy options‖. Ikelegbe (1994:5), defines it as the study of the causes,
processes, formation, implementation and consequences of public policy.
Dye (1976) defines policy analysis ―as finding out what governments do, why they do it and
what difference it makes‖. He labels policy analysis as the ―thinking of man‘s response‖ to
demands. He observes that specifically public analysis involves:
1. A primary concern with explanations rather than prescription.;
2. A rigorous search for the causes and consequences of public policies; and
3. An effort to develop and test general propositions about the causes and consequences of public
policy and to accumulate reliable research findings of general relevance.
Policy analysis as a technique puts data to use in, or deciding about, estimating and
measuring the consequences of public policy. Its purpose is twofold. It provides
maximum information with minimal cost about:
(i) The likely consequences of proposed policies, and
(ii) The actual consequences of the policies already adopted.
To achieve these two purposes, various methods or approaches are applied. Among the
principal methodologies are:
(a) Systems analysis and simulation;
(b) Cost benefit analysis;
(c) New approaches to budgeting;
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(d) Policy experimentation; and

(e) Policy evaluation
Policy analysis is thus an inter-discipline drawing upon data from other discipline.
The common denominators in these definitions are:
-base alternative to intuitive judgments;

-oriented and analytical in nature;
-disciplinary and an academic discipline that draws on the
knowledge, methods, theories, and models developed in political science, economics,
psychology, sociology, law and philosophy. It is descriptive and prescriptive in nature,
especially as it attempts to proffer solutions to social problems.
For our purpose, policy analysis can be conceptualized as the study of the formation,
implementation and evaluation of public policy, the values of policy-makers, the
environment of the policy-making system, the cost of policy alternatives and the study of
policies for improving policy-making (meta-policy). Its goal is to improve the basis of
policy-making and generate relevant information needed to resolve social problems.
Public policy analysis is aimed at improving the basis for public policy making.
2.2 ELEMENTS OF GOOD POLICY ANALYSIS

The key elements of good policy analysis include the following (Nagel, 1984):
(i) VALIDITY
Validity, in general, refers to being accurate. In the context of policy analysis, validity
refers to the internal consistency of logically drawing a conclusion that follows from the
goals, policies, and relations, the external consistency with empirical reality in describing
the relations between the alternative policies and the goals; the policies being considered
encompass the total set of feasible alternatives (feasibility in this context refers to capable
of being adopted and implemented by the relevant policy makers and policy appliers);
and the listed goals include all the major goals and only the goals of the relevant policy
makers in this context.
(ii) IMPORTANCE
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The concept of importance can be defined in two ways. First, does the research deal with
issues on which there are big societal benefits and/or big societal costs being analysed?
Second, does the research deal with a subject matter or a set of causal hypotheses that
potentially have broad explanatory power? This is theoretical importance, as contrasted to
policy importance.
(iii) USEFULNESS
Usefulness as as its lowest level involves doing policy research that is not referred to/by
the people who make policy in the subject-matter area. At the next level is research
referred to/by policy makers orally or in a citation, even if the research cited is not on the
winning side. At a higher level is research that reinforces pre-conceived decisions. Policy
researchers should be pleased if their research accelerates a worthwhile decision that
otherwise might be delayed. At the highest level is the rare case of policy research that
converts decision makers from being negative to being sensitive, or vice versa, on an
issue.
ORIGINALITY
Originality refers to the extent to which policy research differs from previous research,
although even highly original research builds and synthesizes prior research.
(v) FEASIBILITY
Feasibility is an additional criterion for judging proposed policy research, as contrasted to
completed policy research. Feasibility is concerned with how easily research can be
implemented given the limited time, expertise, interest, funds, and other resources of the
researcher.
2.3 PHASES OF POLICY ANALYSIS
Regardless of the nature, type and level of policy to be analyzed, three inter-related
steps are required, namely:
2.3.1 PERCEPTION PHASE
This phase requires much interaction between policy-makers and specialist of
policy analysts. For an analytic approach, the first step is to identify whether and
why there is a probe, at all. Defining the problem involves moving from mundane
descriptions to a more abstract, conceptual plane. However, there is a general
tendency for policy analysis to accept statements on problems made by politicians
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without much scrutiny to ascertain the soundness or correctness of those

statements or how they could influence the policies that emerge from them. Another
difficulty experienced in this phase of policy analysis stems from the ideological,
professional and communication differences between politicians as policy-makers
and administrators and technocrats as executors of policies.
2.3.2 DESIGN PHASE
This is basically concerned with finding alternative solutions to problems and
determining the criteria for comparing one against the other. Too often we lose
sight of the rational objectives. Paying careful attention to the objectives is very
important. Design is the process of discovering new elements and building on
known or existing elements in such a way as to produce a desired whole. It also
means constructing different alternatives to solving a particular problem given that
possible number of alternatives in any given situation is virtually unlimited. While it
is technically possible in many cases to consider all possible alternatives and their
impact, the time, cost and relevance of doing so is often prohibitive. Policy analysis
and decision-makers invariably find a way of judging which alternatives seem more
relevant than the others. Real world constraints also limit the number of feasible
alternatives to a few choices. The danger, however, is that some important
alternatives may be overlooked.
2.3.3 EVALUATION PHASE
Having identified the underlying problem and having determined the alternatives
for policy choice, what are the consequences of each of the alternatives? For this, the
policy analysts will turn to a relevant model for forecasting consequences. It is
important to determine which kind of government intervention is most positive in
any particular situation. This is an intellectual process which involves predicting the
consequences of selecting each of the various alternatives and deciding which of
them to select. It may simply require the judgment of an individual expert or it may
involve using a quantitative model, such as: an elaborate computer programme that
combines in a single computation various sub-models for determining the financial
cost, environmental forecasts and goal achievements. It may also involve a variety of
processes including quantitative and qualitative methods and gaming exercises.
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What is common to all evaluations is that they are done with the aid of some kind of
model which is used in an experimental fashion to try out the various alternatives. It
is necessary to predict all the effects of the proposed policies, not just the economic
effects desired by the decision-maker.
If the consequences of an alternative course of action are uncertain and especially if
the possible outcomes differ widely from one another, the analyst may wish to
develop a decision tree and evaluate the probability of each outcome. Evaluation of
the outcomes is of great importance as it reminds us to look carefully at the cost-
benefit analysis of a particular policy choice Too often, policy choices are sabotaged
by bureaucrats and interested politicians. The analysts should seek the counsel of
experts in the field.
2.3.4 MAKING A CHOICE PHASE
The last step in policy analysis relates to making the preferred choice (course of
action). The situation may be so simple for the policy maker that he can simply look
at the consequences predicted for each alternative and select the one that is best. In
contrast, it may be so complex that he will have to think of his preferences among
the various possible outcomes, that is, how the world will behave in response to the
possible choices. However, it should be noted that the choice among competing
policy alternatives is complex, for the future is always uncertain. But, by enhancing
our capability to forecast the consequences of the alternative courses of action and
providing a framework for valuing those consequences, the techniques of policy
analysis lead us to better decisions.
Chapter Three
Models for Policy Analysis

3.1 Process of Policy Making
Policy making is the process by which the government or enterprise develops or formulates
and implements an effective strategy to meet desired objectives. Strategy in this context is
the unified comprehensive plan that is developed to reach these objectives. Public policy
process can be classified into five stages, as illustrated in figure below:
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Public Policy Cycle or Process
policy
policy formation
evaluation
policy policy
implementation formulation
policy adoption
3.2 Models for Policy Analysis
3.2.1 Elite Mass Group Model
In this approach, public policy can be regarded as the values and preferences of the
governing elites. The essential argument of the elite theory is that it is not the people or the
―masses‖ who determine public policy through their demands and action, rather, public
policy is decided by ruling elite and effected by public officials and agencies. Dye and
Zeigler, (1981) in the ―Irony of Democracy‖ provide a summary of the elite theory:
(i) Society is divided into the few who have power and the many that do not. Only this
small number of privileged persons allocates values for society, the masses do no decide
public policy;
(ii) The few who govern are typical of the masses who are governed. The elites are drawn
disproportionately from the upper socio-economic strata of society;
(iii)Movement of the non-elite to elite positions must be slow and continuous to maintain
stability and avoid revolution. Only the non-elite who have accepted the basic elite
consensus can be admitted to governing circles;
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(iv) The elites share a consensus on the basic values of the social system and the
preservation of the system;
(v) Public policy does not reflect demands of the masses but rather the prevailing values of
the elite. Changes in public policy will be incremental changes permit responses to events
that threaten a social system with a minimum of alteration or dislocation of the system;
(vi) Active members of the elites are subject to relatively little direct influence from
apathetic masses. The elites influence the masses more than masses influence the elite.
So state, the elite theory is a rather provocative theory of policy formation. Policy is the
product of the elite, reflecting their values and serving their ends, one of which may be a
desire to provide for the welfare of the masses. Thus, elite theory does focus our attention
on the role of leadership in policy formation and on the fact that, in any political system, a
few govern the many. However, whether the elite rule, and determine policy, with little
influence by the masses is a difficult proposition to handle.
3.2.2 SYSTEMS THEORY

Public policy may be viewed as the response of a political system to demands arising from its
environment. The political system, as defined by Easton,(1965) is composed of those identifiable and
interrelated institutions and activities in a society that make authoritative decisions (or allocations of
values) that are binding on society. In puts into the political system from the environment consist of
demands and supports. The environment consists of all those conditions and events external to the
boundaries of the political system. Demands are the claims made by individuals and groups on the
political system for action to satisfy their interests. Support is rendered when groups and individuals
abide by election results, pay taxes, obey law, and otherwise accept the decisions and actions of the
authoritative political system made in response to demands.
These authoritative allocations of values constitute public policy. The concept of feedback indicates
that public policies (or outputs) may subsequently alter the environment and the demands generated
therein, as well as the character of the political system itself. Policy outputs may produce new
demands, which lead to further policy outputs, and so on in a continuing, and never ending flow of
public policy. Political system theory is useful in understanding the policy-making process and its
value to policy analysis lies in the questions that it asks:
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 What are the important dimensions of the environment that generate demands upon the
political system?
 What are significant characteristics of the political system that enable it to transform
demands into public policy and to preserve itself over time?
 How do environmental inputs affect the character of the political system?
 How do the characteristics of the political system affect the content of public policy?
 How do environmental inputs affect the content of public policy?
 Finally, how does public policy affect, through feedback, the environment and the character
of the political system?
The usefulness of systems theory for the study of public policy analysis is limited by its highly
general nature. It does not say much concerning how decisions are made and policy is developed
within the ―black box‖ called that political system. Nonetheless, systems theory is a useful aid in
organizing inquiry into policy formation. However, the usefulness of the system model is limited due
to several factors. First, this model is criticized for employing the value-laden techniques of welfare
economics, which are based on the maximization of a clearly defined ―social welfare function‖. The
missing ingredients in the systems approach are the ―power, personnel and institutions‖ of policy
making.
In examining these, there is need to note that decision-makers are strongly constrained by economic
factors in the environment of the political system. Secondly, the model also ignores an important
element of the policy process, namely, that the policy makers (including institutions) have also a
considerable potential in influencing the environment within which they operate. The traditional
input-output model would see the decision-making system as ―facilitative‖ and value-free rather than
―causative‖ that is as a completely neutral structure. In other words, structure variations in the
systems are found to have no direct casual effect on public policy.
Finally, the extent to which the environment, both internal and external is said to have an influence
on the policy-making process is determined by the values and ideologies held by the decision-makers
in the system. It suggests that policy-making involves not only the policy content but also the policy-
makers perceptions and values. The values held by the policy-makers are fundamentally assumed to
be crucial in understanding the policy alternatives that are made.
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3.2.3 INSTITUTIONAL THEORY

The study of government institutions is one of the oldest of political science. The approach focuses
on the formal or structural aspects of an institution and can be adopted in policy analysis. An
institution is a set of regularized patterns of human behavior that persist over time. Some people,
unsophisticated, of-course, seem to equate institutions with the physical structures in which they
exist. It is their differing sets of behavior, which we often call rules, structures and the like, that can
affect decision-making and the content of public policy. Rules and structural arrangements are
usually not neutral in their impact; rather, they tend to favour some interests in society over others,
some policy results rather than others. Public policy is formulated, implemented and enforced by
government institutions.
Government institutions are given legal authority to policies and can legally impose sanctions on
violators of its policies. As such, there is a close relationship between public policy and
governmental institutions. It is not surprising, then, that political scientists would focus on the study
of governmental structures and institutions. Institutionalism, with its focus on the legal and structural
aspects can be applied in policy analysis. The structures and institutions and their arrangements and
can have a significant impact on public policy. Traditionally, the focus of study was the description
of government structures and institutions. The study of linkage between government structures and
policy outcomes remained largely unanalyzed and neglected.
The value of the institutional approach to policy analysis lies in asking what relationships exist
between institutional arrangements and the content of public policy and also in investigating these
relationships in a comparative manner. It would not be correct to assume that a particular change in
institutional structure would bring about changes in public policy. Without investigating the actual
relationship between structure and policy, it is difficult to assess the impact of institutional
arrangements on public policies.
3.2.4 PROCESS THEORY

This is similar in some ways to the systems theory. But instead of looking at policy outputs as
consequences of environmental inputs, it focuses on the process or procedure of policy
formulation. There are identifiable patterns of political activities or processes which often
culminate in the formulation of public policies. The policy processes are as follow:
 Policy formation
 Agenda setting
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 Policy formulation
 Policy enactment
 Policy implementation and
 Policy evaluation
The approach is cyclical. However, it should be noted that a change in the process of
policy making may not bring about changes in the content of policies. It appears that
social, political, economic and technological constraints on policy makers in developing
countries are so many that changing either the formal or informal processes of decision
making may or may not change the content of public policy.
3.2.5 GROUP THEORY
According to the group theory of politics, public policy is the product of the group
struggle. As one writer states: ―what may be called public policy is the equilibrium
research in this (group) struggle at any given moment, and it represents a balance which
the contending factors or groups constantly strive to weight in their favor‖. Group theory
rests on the contention that interaction and struggle among groups in the central fact of
political life. A group is a collection of individuals that may, on the basis of shared
attitudes or interests, make claims upon other groups in society. It becomes a political
interest group ―when it makes a claim through or upon any of the institutions of
government. And of course, many groups do just that. The individual is significant in
politics only as he is a participant in, or a representative of groups. It is through groups
that individuals seek to secure their political preferences.
Public policy, at any given time, will reflect the interest of dominant groups. As groups
gain and lose power and influence, public policy will be altered in favour of the interests
of those losing influence. Group theory, while focusing attention on one of the major
dynamic elements in policy formation, especially in pluralist societies, such as the United
States, seems both to overstate the importance of groups and to understate the
independent and creative role that public officials play in the policy process. Indeed,
many groups have been generated by public policy.
The American farm bureau federation, which developed around the agricultural extension
programme is a notable example, as is the National welfare rights organization. Public
officials also may acquire a stake in particular programmes and act as an interest group in
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support of their continuance. Finally, we should note that it is rather misleading and
inefficient to try to explain politics or policy formation in terms of group struggle without
giving attention to the many other factors for example, ideas and institutions that abound.
This sort of reductionist explanation should be avoided.
3.2.6 INCREMENTAL MODEL
Braybrooke and Lindblom (1963) attempted to discredit rational model of decision-making
before formulating their preferred alternative. They point out that it was not easy to distinguish
between ends and means. They suggest that the rational comprehensive model of decision-
making did not accord with facts. They argue that in the real world, the rational model or even
―bounded rationality‖ cannot be applied. According to them, decision-makers do not in practice
evaluate all the possible options open to them in a given situation, but choose between relatively
few alternatives.
Moreover, strategic decision-making tends to involve small-scale extensions of past
policies (incrementalism), rather than radical search. Decision-making does not normally
involve a detached planner or manager impartially sifting options to find the best
solution. In practice it necessitates seeking accommodation or compromises with interest
groups a process, they describe as ―partisan mutual adjustment‖. Such decision was seen
as the outcome of political bargaining. They argue that strategic decision-making often
does not proceed according to any coherent plan, but rather proceeds disjointedly
(disjointed incrementalism). Braybrooke and Lindblom thought this incremental model
has to be preferred to the rational comprehensive model of Simon and Dror.
3.2.6.1 ELEMENTS OF INCREMENTAL MODEL

Incremental model of decision-making has the following elements:
(i) The selection of goals or objectives and the empirical analysis of the action needed to attain
them are closely intertwined with rather than distinct from one another.
(ii) The decision-maker considers only some of the alternatives for dealing with a problem and
these will differ only incrementally from existing policies
(iii) For each alternative, only a limited number of important consequences are evaluated
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(iv) The problem confronting the decision-maker is continually redefined
(v) There is no single or right solution to a problem. The test of a good decision is that various
analysts find themselves directly agreeing on it, without agreeing that the decision is the most
appropriate means to an agreed objective
(vi) Incremental decision-making is essentially remedial and is geared more to the present,
concrete social imperfections than to the promotion of future social goals.
This model of decision-making attracted so many practitioners involved in decision-making,

as it tends to suggest that what they were actually doing in their organizations (muddling
through) was right all the time. It also became attractive to political scientists because the
model involved political process and politics were treated as natural and not as regrettable
interference with rational decision-making. However, critics of incrementalism argue that the
model is not a good prescriptive model that decision makers should aspire to do better. It
cannot explain or account for spontaneous or sudden changes that take place in the
environment, especially, in the long-term strategic planning or where technological changes
are taking place that require radical decision. Thirdly, incrementalism does not seem to high-
high the role of corporate culture (strategy as perspective) perhaps on decision-making, as it
filters out unacceptable choices.
Fourthly, the anti-rational position of incrementalism leaves no room for the development and
application of rational analysis, especially with contributions from modern analytical tools and
techniques, for example, linear programming probability decision trees, forecasting, simulation
etc.
Finally, even as a descriptive model of the public sector, it does not always fit some
changes so not all incremental, but involve dramatic shifts, such as, the re-organization of
Natural education Policy in Nigeria Universal Basic Education Scheme (6-3-3-4).
However, in his later work Lindblom (1968) countered this criticism and asserted that
incrementalism was possible to achieve a radical shift as ―one person‘s incremental
decision could be another man‘s radical change‖. He conceded the argument for forward
planning and application of analysis using analytical techniques.
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3.2.7 RATIONAL CHOICE THEORY

Rational choice theory is best characterized as a school or an approach to understanding the
dynamics of public policy; it is a ―family of theories‖ rather than a single theory (Green and
Shapiro 1994, 28). The likes of game theoretical accounts of strategic interactions (Axelrod
1984), social choice critiques of the impossibility of a democratic aggregation of interests
(Arrow 1951), and public choice applications of economics to politics (Niskanen 1971; Olson
1982) all sit shoulder to shoulder under the auspices of rational choice. In this opening section,
we identify a set of common building blocks that arguably provide the foundations that hold such
mainstream rationalist approaches together; foundations that have however been stretched or
applied over time with varying levels of consistency as we shall discover below. Our first
common building block is the assumption of rationality, which posits that individuals in the
policy process are rational, and that the behavior of agents is best explained by imputing
rationality on to them (Dowding and King 1995, 1). We then go on to examine further heroic
qualities associated with individuals in the form of consistent and rank-ordered preferences
before addressing the premises of methodological individualism and deductive reasoning.
The rational-choice theory, which is sometimes called social-choice, public-choice, or formal
theory, originated with economists and involves applying the principles of micro-economic
theory to the analysis and explanation of political behavior (or nonmarket decision-making). It
has now gained many adherents among political scientists.
Perhaps the earliest use of rational-choice theory to study the political process is Anthony
Downs's Economic Theory of Democracy. In this influential book, Downs assumes that voters
and political parties act as rational decision-makers who seek to maximize attainment of their
preferences. Parties formulated whatever policies would win them most votes, and voters sought
to maximize the portion of their preferences that could be realized through government action. In
attempting to win elections, political parties moved toward the center of the ideological spectrum
to appeal to the greatest number of voters and maximize their voting support. Thus, rather than
providing voters with "meaningful alternatives," parties will become as much alike as possible,
thereby providing an "echo rather than a choice."
Let us now look more closely at the major components of rational-choice theory. One of its
basic axioms is that political actors, like economic actors, act rationally in pursuing their own
self-interest. Thus economist James Buchanan, a leading proponent of rational-choice theory,
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contends that politicians are guided by their self-interest rather than an altruistic commitment to
such goals as statesmanship or the national interest. "This should be no surprise," says Buchanan,
"because governments are made up of individuals, and individuals operate from self-interest
when they are engaged in a system of exchange, whether this is in the market economy or in
politics." Individuals who are engaged in decision-making exchanges or transactions, such as
voting, also have preferences that vary from person to person. Being rational, individuals are
able to comprehend and rank their preferences from most to least desired. In making decisions
(whether economic or political), they are guided by these preferences and will seek to maximize
the benefits they gain. In short, people are self-interested utility maximizers, not the uninformed,
confused, or irrational choice-makers often depicted in analyses of political behavior.
A second basic axiom of rational-choice theory involves methodological individualism. The
individual decision-maker is the primary unit of analysis and theory. The individual's preferences
or values are assumed to be more important than other values—collective, organizational, or
social. Conversely, rational-choice theorists argue that the actions of organizations and groups
can be satisfactorily explained in terms of the behavior of a model individual. Nothing
substantial will be lost by so doing in explaining the behavior of all persons.
For example, a rational-choice explanation of why Congress delegates discretionary power to
administrative agencies begins with the assumption that the preference of members of Congress
is to get reelected. To this end, legislators delegate power to agencies, knowing that in exercising
that power the agencies will create problems for their constituents. Legislators will then be called
on by their constituents to assist them with their bureaucratic problems and, in return for
assistance, the grateful constituents will vote to reelect the legislators. The pursuit of self-interest
by the members of Congress thus explains the delegation of power and the growth of
bureaucracy.
Some rational-choice theorists have explored the effects of incomplete or imperfect
information and uncertainty on policymaking. Political decision-makers are said to be possessed
of differing amounts of information (a condition called information asymmetry) and are uncertain
about the outcomes or consequences of laws and policies when they are implemented. In
Congress, legislative committee members, as policy specialists and the basic developers of
legislation, are best informed about the relationship between a proposed policy and its likely
consequences. In comparison, the rank-and-file members of Congress, who make the final
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decisions on the enactment of legislation, have only limited knowledge of the policy-
consequences relationships. Conceivably this information asymmetry would permit committee
members to act strategically and secure the enactment of policies of benefit primarily to
themselves (and their constituents).
Various rules and practices in Congress, however, help ensure that legislators will have
incentives both to specialize in analyzing public problems and Grafting policies and to make
information generally available to the members of Congress. The problem is to identify the
institutional arrangements that help reduce uncertainty. This "information-theories" variant of
rational choice continues to assume that legislators are utility maximizers with differing interests.
Their utility, however, is determined by policy outcomes rather than by policies per se. About
outcomes, as we have seen, there is uncertainty.
THE ASSUMPTION OF RATIONALITY
Within rational choice accounts of public policy, individuals are characterized as instrumental
actors, pursing courses of actions ―not for their own sake, but only insofar as they secure desired,
typically private ends‖ (Chong 1996, 39). In this instance, rationality is entwined with utility-
maximization. Rational individuals are those individuals who, when faced with distinct courses
of action or policy options, choose the feasible course of action, which is most likely to
maximise their own utility. Rationality thus emerges from an actor‘s capacity to calculate and
attach costs and benefits to available policy options, and to select the course of action that best
maximises her own utility (Dunleavy1991, 3; Majone 1989, 13; Elster 1986, 4). Policy actors are
constructed as egotistical, self-regarding instrumental actors, ―choosing how to act on the basis
of the consequences for their personal welfare (or that of their immediate family)‖ (Dunleavy
1991, 3). As such, mainstream rational choice lends itself towards explanations of policy
outcomes grounded in the goal-oriented action of individuals (MacDonald 2003, 552) where the
desires, beliefs, and preferences of individual actors are identified as the causes of their actions
(Green and Shapiro, 1994: 20). Of course, such rational behavior by individuals will not
necessarily produce positive collective outcomes. Rational utility-maximizing individuals will
and do deliver collectively unintentional outcomes or socially irrational outcomes (Levi 1997,
20) as the ―tragedy of the commons‖ demonstrates (Hardin 1969). Rational choice thus explains
the irrational collective outcomes of the individual actions of rational actors.
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RANK-ORDERED AND CONSISTENT PREFERENCES

As we suggested above, this assumption of rationality hinges upon a number of heroic qualities
attached to individual actors, not least that rational actors possess, even when faced with
complex situations, the capacity (in terms of information, time, and objectivity) to choose the
optimum course of action open to them (Ward 2002, 68). Importantly, individual rational actors
must, if the assumption of rationality is to hold, possess preferences or wants that are ranked-
ordered, and consistent in that they are both transitive and stable over time. First, the rank-
ordering of preferences asserts that individuals are able to establish a hierarchy of wants or
preferences; preferences of course have to be comparable. Second, the condition of transitivity
establishes a particular consistency of preferences in that if an individual prefers oranges (x) to
pears (y) and pears (y) to apples (z), she will prefer oranges (x) to apples (z). Under such
conditions, preferences are said to be transitive. Finally, an individual‘s preferences are taken to
be both stable over time (at least in the short-term), and to be given. In terms of this latter
condition, that which assumes the given-ness of preferences, mainstream rationalist accounts are
simply saying that for the purposes of explanation, they are not overly concerned with the origins
of individuals‘ preferences. For Shepsle and Bonchek, rational choice accounts ―take people as
we find them,‖ less concerned with ―why they want what they want‖ (1997, 17).
METHODOLOGICAL INDIVIDUALISM
Mainstream rational choice builds its explanations of policy outcomes on the actions of
individuals, privileging the role of actors over and beyond that of social structures. Social
structures are attributed no ―independent status apart from the individuals who constitute them.
Only actors choose, prefer, believe, learn and so on: society does not act independently of them‖
(Lichbach 2003, 32–33). This privileging of actors locates the explanation of macro-level
phenomena at the micro-level of the individual, or at the aggregated behavior of individuals (Van
Thiel 2004, 180). Social structures are thereby conceptualized through the intentional behavior of
individuals, interpreted as the aggregate result of the calculations and utility-maximizing
strategies of individual actors, such that institutions become ―instrumental products used by
individuals to maximise their respective utilities‖ (Blyth 2002, 19). As such, rational choice
stresses the production of causal mechanisms, underplayed in structural and functionalist
explanations (Chong 1996, 42–43). For, as Laver argues, ―the primitive motivational
assumptions‖ of rational choice ―relate to the individual as a self-contained unit of analysis‖
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DEDUCTIVE REASONING
In applying deductive reasoning, rational choice explanations of policy outcomes advance
through first establishing sets of propositions and statements about real world phenomena and
the rational behavior of individuals, and then testing these propositions through comparison with
events and the actual behavior of actors (Laver 1997, 4). Indeed, Laver (1997) makes an
emblematic defence of the value of what he calls the a priori approach of rational choice over
and beyond predominant empirical approaches to policy analysis (for another defense see Ward
2002, 69–70). Such predominant empirical approaches, Laver argues, simply extrapolate
generalized propositions about political behavior from ―systematic observations of what real
people actually do,‖ which ―in the last analysis more or less says that the world is as it is because
that‘s how it is‖ Laver argues, however, that the very value of deductive reasoning in rational
choice accounts lies in the fact that the explanation of political outcomes derives from
motivational assumptions defined in another realm, that of the individual.
RATIONAL COMPREHENSIVE MODEL
The rational comprehensive model has the following elements:
(i) The decision-maker is confronted with a given problem that can be separated from other
problems or at least considered meaningfully in comparison with them.
(ii) The goals, values or objectives that guide the decision-maker are classified and ranked
according to their importance
(iii) The various alternatives for dealing with the problems are examined
(iv) The consequence (Cost and benefits) that would follow from the selection of each
alternatives are investigated
(v) Each alternative and its attendant consequences can be compared with the other alternatives
(vi) The decision-maker will choose that alternative and its consequences that maximize the
attainment of his goals, values and objectives.
However, these assumptions are difficult to attain in real world. There are many barriers
associated with rationality. In rational comprehensive model, all information required for
alternative decisions are not available. All alternatives cannot be possibly obtained and
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consequences predicted. Beside, most societal values do not reach the decision agenda because
of powerful elites and interest groups. Hence, the model is criticized by scholars as being too
idealistic and narrow because it neglects some political variables of decision making.
1.3 Actors and Institutions in Public Policy
3.3.1 Official Actors

The official Actors in public policy process are those who are legally empowered to formulate
public policy. They are those who occupy the formal offices prescribed by the political
community as authoritative. They are members of the legislature, local councilors, ministers,
senior officials and judges. Since governments at the national level are formed usually by the
leaders of the political party with the majority of seats in the legislature, it is important to
understand how the parliamentary leadership is likely to behave. Unofficial Actors include the
political parties, interest groups and citizens. In this unit, we shall examine each official and
unofficial actor in public policy making process.
3.3.1.1 EXECUTIVE
One dimension of the study of policy-making attempts to assess the role of the executive.
Modern governments everywhere rely on executive leadership both in policy formation and
policy implementation. In the United Kingdom with parliamentary system operating cabinet
government, the governments in most cases rely on their back-benchers to provide them with the
majorities necessary to conduct government business. The executive arm of government has a
legal authority in public policy formulation. It is one the official Actors. The executive councils
collectively reach decisions on various policy matters placed before them at cabinet meetings.
For example, various policy initiatives emanate from ministries, departments and agencies of
government.
3.3.1.2 LEGISLATURE
The legislature also plays a notable role in policy-making. In democratic political environment
implementation of most policies can only be commenced when the appropriate legislation has been
put in place and money appropriated in the budget for the programmes and initiatives requiring
legislation go through assembles. These assemblies wield a lot of power as policy proposals
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submitted by the executive are subjected to substantial amendments in the assembly. The national
assembly performs oversight function of largely done through select committee, which has the power
servant‘s ministers of their ministries. The public accounts committee in the national assembly
monitors public expenditures of various ministries and agencies.
3.3.1.3 EXPERTS/TECHNOCRATS IN ADMINISTRATIVE AGENCIES/Bureaucrats

Top Administrators or appointed officials play major role in policy implementation. Policy is
laid down by the legislature or the political authorities, who are vested with the power of giving
policy the legal authority. The legislature lays down a policy in general terms which is usually
expressed in the form of acts and laws. In order to give more precise expression to these acts and
laws, the administrative arm of the government plays an important role in policy-making also.
But, in the main, the administrative arm does not legally possess the power of making a policy; it
assists in policy making. Its responsibility lies in the sphere of policy implementation.
In summary, experts and technocrats in administrative agencies play roles in policy formation
process. They supply information and help to articulate (at both the macro and micro levels, on
the hand, and at the objective and subjective levels, on the other) the broad objectives that guide
policy directions as a totality of management. The advice of experts can also lead to the initiation
of policies by decision-makers or politicians, apart from the vision of the government itself in
addition, experts assist with the scientific management of the policy process through policy
formulation and analysis.
3.3.1.4 LAW COURTS

In countries where the courts have the power of judicial review like Nigeria and United States of
America, courts play an important role in policy formation. The courts have often greatly affected the
nature and content of public policy through exercise of the powers of judicial review and statutory
interpretation in cases brought before them. In any political system, the courts or judiciary participate
in policy-making process indirectly. Courts are approached to interpret and decide the meaning of
legislative provisions that often generally stated and permit conflicting interpretations. Any judge
confronted with a choice between two or more interpretations and applications of a legislative act,
executive order or constitutional provision must choose from among them because the decision has
to be given or the controversy must be ended. And when the judge does so, his or her
interpretation becomes policy for the specific litigants. When a court accepts one interpretation
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or a decision is accepted by other courts, the court has made a policy for all jurisdiction in which
that view prevail.
3.3.2 UNOFFICIAL PARTICIPANTS

Beside the official Actors in public policy making, many others participate in the public policy
process. These units influence policy formation without possessing legal authority to make
binding policy decisions. These unofficial Actors include:
3.3.2.1 POLITICAL PARTIES

In modern societies generally, political parties perform the function of ―interest aggregation‖,
that is, they seek to convert the particular demands of interest groups into general policy
alternatives. The way in which the parties ―aggregate‖ interests is affected by the number of
desire of the parties to gain widespread electoral support will force both the parties to include in
their policy proposals popular demands and avoid alienating the most important social groups
3.3.2.2 INTEREST GROUPS

While the executive (cabinet ministries, agencies/parastatals) plays the central role in policy-
making, the need for consensus building in the process dictates that various interest groups be
carried along these groups contribute inputs in various ways into the policy-making process and
use covert and overt pressures to influence directly or indirectly the policies of government at
any particular point in time. Through various channels, they contribute inputs into the debates
and discussions that go on before a particular issue is crystallized as policy decision of
government. For example, deregulation of petroleum product policies. Various interest groups,
such as labour union, media, private sectors/ professional bodies, non-governmental
organizational and civil society organizations were given the opportunity to contribute towards
shaping the desired policy.
3.3.2.3 INDIVIDUAL CITIZENS

Since democratic governments are representative governments, it is often said that citizens are,
therefore, indirectly represented in all policy making. In an abstract sense, this is true, but
concretely, this aphorism means very little. Citizens‘ participation in policy making, even in
democratic countries, is very negligible. Many people do not exercise their franchise or engage
in party politics. They neither join pressure groups nor display any active interest in public
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affairs. Even, while voting, voters are influenced comparatively little by policy considerations.
However, despite such political attitudes of great majority of citizens, some still participate
directly in decision making through demands to government.
3.3.2.4 INFLUENCE OF MEDIA

A prerequisite of democracy is free media of communication. The media channel information
between the citizen and government. They communicate the information to the citizen s about the
decisions the governments have taken. In this way, the media help shape their reactions to each
other‘s decisions. By publicizing specific causes, the media act as the most important source of
information for the government on the public‘s reactions to contemporary issues. However, if the
citizen is to make rational decisions about public policy, the media should be of a high standard of
reliability. They should be seen as biased against government of the day, but offer constructive
criticisms when necessary. The media can influence public opinions especially where the government
is responsive and responsible to the public. It is only then they can be influential in determining
policy.
3.3.2.5 Think tanks

A think tank is a research organization whose objective is to influence the policy process through
the provision of information and ideas, either directly to government or by informing the
community more generally. Think tanks are likely to have quite different interests, resources and
objectives, but a shared theme appears to be the desire to introduce research and ideas into the
public policy process with a view to influencing the outcome of that process. Measuring and
understanding the impact of think tanks is difficult, however, as Ian Marsh has suggested:
[t]he complexity of the policy-making process and the absence of clear benchmarks for
effectiveness complicates the task of assessment. Think tanks are one institutional actor
in a complex system made up of a variety of organisations and processes. It is no easy
task to determine the contribution of particular actors to particular outcomes or to judge
the adequacy of a whole system.
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Chapter Five
The Process of Public Policy Making
5.1 Perspectives on Policy Process
From the year 1950 the field of policy analysis has been strongly connected with a perspective
that considers policy process through a sequence of discrete stage or phrases. The policy cycle
framework or perspective has served as a basic template to systematize and compare the
diverse debates, approaches and models in the field and to assess the individual contribution
of the perspective approach to the discipline.
5.2 The Policy Cycle- Simplified Model of the policy process

The idea of modeling the policy process in terms stage and phases was first put forward by
Lasswell. In his attempt to establish a multidisciplinary and perspective policy science,
Lasswell introduced a model of the policy process comprised of seven stages: Intelligence,
Promotion, Prescription, Advocacy, Invocation, Termination and Appraisal. Even though the
sequence of this model has been contested, the model itself has been highly successful in
providing basic framework for the field of policy studies and became the starting point of a
variety of typologies in policy process. Subsequently, a number of various stages typology
have been put forward by various scholars.
Today, the differentiation between agenda setting, policy formulation, decision making,
implementation and evaluation has become the conventional way to describe the chronology
of a policy process. Lasswell‘s understanding of the model of policy process was more
prescriptive and normative than descriptive and analytical. His sequence of the different
stages had been designed like a problem solving model and accords with other prescriptive
rational models of planning and decision making developed in organization theory and public
administration.
Still stages of public policy were conceived as evolving in a chronological order- first
Problems are identified and put on the agenda, next policies are developed, adopted,
implemented, and finally these policies will be assessed against their effectiveness and
efficiency and either terminated and or restarted. Combined with Easton‘s input-output model
this stages perspective was then transformed into a cyclical model, the so-called policy cycle.
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The cyclical perspective emphasizes feed-back (loop) processes between outputs and inputs of
policy-making, leading to the continual perpetuation of the policy process. Outputs of policy
processes at t1 have an impact on the wider society and will be transformed into an input
(demands and support) to a succeeding policy process at t2. The integration of Easton‘s input
output model also contributed to the further differentiation of the policy process.
While the policy cycle framework takes into account the feedback between different elements of
the policy process (and therefore draws a more realistic picture of the policy process than earlier
stages models), it still presents a simplified and ideal-type model of the policy process, as most
of its proponents will readily admit. Under real-world conditions, policies are, e.g., more
frequently not the subject of comprehensive evaluations that lead to either termination or
reformulation of a policy. Policy processes rarely feature clear-cut beginnings and endings. At
the same time, policies have always been constantly reviewed, controlled, modified, and
sometimes even terminated; policies are perpetually reformulated, implemented, evaluated, and
adapted. But these processes do not evolve in a pattern of clear-cut sequences; instead, the stages
are constantly meshed and entangled in an ongoing process. Moreover, policies do not develop in
a vacuum, but are adopted in a crowded policy space that leaves little space for policy
innovation.
5.3 THE STAGES OF THE POLICY CYCLE
5.3.1 AGENDA-SETTING:
Policy-making presupposes the recognition of a policy problem. Problem recognition itself
requires that a social problem has been defined as such and that the necessity of state
intervention has been expressed. The second step would be that the recognized problem is
actually put on the agenda for serious consideration of public action (agenda-setting). The
agenda is nothing more than ―the list of subjects or problems to which governmental officials,
and people outside the government closely associated with those officials, are paying some
serious attention at any given time‖. The government‘s (or institutional) agenda has been
distinguished from the wider media and the overall public (or systemic) agenda. While the
government‘s (formal and informal) agenda presents the center of attention of studies on agenda-
setting, the means and mechanisms of problem recognition and issue selection are tightly
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connected with the way a social problem is recognized and perceived on the public/media
agenda. Problem recognition and agenda-setting are inherently political processes in which
political attention is attached to a subset of all possibly relevant policy problems. Actors within
and outside government constantly seek to influence and collectively shape the agenda by taking
advantage of rising attention to a particular issue, dramatizing a problem, or advancing a
particular problem definition). The involvement of particular actors (e.g., experts), the choice of
institutional venues in which problems are debated and the strategic use of media coverage have
been identified as tactical means to define issues. While a number of actors are involved in these
activities of agenda control or shaping, most of the variables and mechanisms affecting agenda-
setting lie outside the direct control of any single actor.
Agenda-setting results in a selection between diverse problems and issues. It is a process of
structuring the policy issue regarding potential strategies and instruments that shape the
development of a policy in the subsequent stages of a policy cycle. If the assumption is accepted
that not all existing problems could receive the same level of attention.
Systematic research on agenda-setting first emerged as part of the critique of pluralism in the
United States. One classic approach suggested that political debates and, hence, agenda-setting,
emerge from conflict between two actors, with the less politically powerful actor seeking to raise
attention to the issue (conflict expansion). Others suggested that agenda-setting results from a
process of filtering of issues and problems, resulting in non-decisions (issues and problems that
are deliberately excluded from the formal agenda).
The crucial step in this process of agenda-setting is the move of an issue from its recognition—
frequently expressed by interested groups or affected actors—up to the formal political agenda.
This move encompasses several sub-stages, in which succeeding selections of issues under
conditions of scarce capacities of problem-recognition and problem-solving are made.
While problem recognition and problem definition in liberal democracies are said to be largely
conducted in public, in the media or at least among domain-specific professional (public)
communities, the actual agenda-setting is characterized by different patterns in terms of actor
composition and the role of the public. The outside-initiation pattern, where social actors force
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governments to place an issue on the systemic agenda by way of gaining public support, presents
but one of different types of agenda-setting. However in the policy process agenda setting will be
carried out without public input when interest groups have direct access to government agencies
and are capable of putting topics on the agenda without major interference or even recognition of
the public. The agriculture policy in certain European countries would be a classic example for
such inside-initiation patterns of agenda-setting. Such kind of agenda setting usually comes out
from the government bodies without significant inputs from the people.
Another pattern has been described as the mobilization of support within the public by the
government after the initial agenda-setting has been accomplished without a relevant role for
non-state actors (e.g., the introduction of the Euro or, rather, the campaign prior the
implementation of the new currency).
Despite the existence of different patterns of agenda-setting, modern societies are characterized
by a distinctive role of the public/media for agenda-setting and policy-making; especially when
novel types of problems (like risks) emerge.
Frequently, governments are confronted with forced choice situations where they simply cannot
ignore public sentiment without risking the loss of legitimacy or credibility, and must give the
issue some priority on the agenda. While the mechanisms of agenda-setting do not determine the
way the related policy is designed and implemented, policies following so-called knee-jerk
responses of governments in forced choice situations tend to be combined with rather intrusive or
coercive forms of state interventions. However, these policies frequently have a short life cycle
or are recurrently object of major amendments in the later stages of the policy cycle after public
attention has shifted towards other issues.
5.3.2 The essence of Policy Formulation

In this stage of the policy cycle, expressed problems, proposals, and demands are transformed
into government programs. Policy formulation and adoption includes the definition of
objectives— what should be achieved with the policy—and the consideration of different
alternative actions. Some authors differentiate between formulation (of alternatives for action)
and the final adoption (the formal decision to take on the policy). Because policies will not
always be formalized into separate programs and a clear-cut separation between formulation and
decision-making is very often impossible, we treat them as sub-stages in a single stage of the
policy cycle.
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Policy formulation process includes the following:

(i) The identification of the policy issues/problems
(ii) Specification of objectives/targets
(iii) Development of options/strategies
(iv) Selection of preferred option/strategies
(v) Policy decision-making
(vi) Design of implementation strategy; and

(vii) Policy review and reformulation
Policy formulation involves the development of pertinent and acceptable proposed courses of action
for dealing with the public problem. Several competing policy proposal for dealing with a given
problem may be presented. Policy formulation doesn‘t always culminate in a law, executive order or
administrative rule. Policy makers may decide not to take positive action on some problem, decide to
leave it alone, to let matters themselves out.
Policy formulation differs from policy formation. Policy formation usually refers to the total process
creating or forming a policy whereas policy formulation refers more narrowly to the development a
proposed course action for handling a problem.
Policy formulation as a technical process involves two different sort of activities. One, what
should be done about a particular problem. The second type of activity comes into play.
Legislation and administrative rules must be drafted which will appropriately carry the agreed
upon general principles and statements.
5.3.3 POLICY ADOPTION STAGE

Legitimating of public policy is another sub-stage in policy formulation. This process means
having a particular proposal authorized. Formulators do not think only of problems and how to
solve them, but whether the course of action is feasible and getting it authorized. Decision or
choices of policy requires some authoritative ratification as an aspect of the principle of public
accountability. While decision may be effectively reached at one level, they will often be
authorized and confirmed at another. Therefore, some strategic considerations are directed
toward the legitimization of process – building support for a proposed course of action,
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maintaining support held previously, deciding where compromises can be made; calculating
when and where to make the strongest play and controlling information flow to advantages.
This is often done by the notion of majority lobby building in legislature. In other words, a
course of action is legitimate when a majority in both houses of the legislature (National
Assembly) approves and the chief Executive affixes his signature to the measure. So, given the
necessity for building majority in a given course of action, formulators of policies must consider
all factors involved in its legitimating process. However, the most formal adoption strategy is
one of proposal, legislative approval and Presidential (Executive) signature. Although, there are
other adoption strategies that exist in government
5.3.4 Policy Implementation

Policy implementation is the process of assembling resources (including people), allocating
resources and utilizing resources (operations), in order to achieve policy objectives. The
administrative agencies are the primary implementers of public policy, but the judiciary and
legislature are also involved. The legislature may over-rule the decision of the executive by two-
third majority, while the Courts interpret statutes and administrative rules and regulations.
Agencies also make ―administrative laws‖ through delegated legislative authority by the
legislature when implementing statutes passed by the congress or National Assembly. The
application of a public policy passed by the Legislature can change the nature of the policy itself,
as implementation often affects policy content.
After a policy has been set, it must be put into effect. An obvious point, of course, except that
much political science stopped at the point where government reached a decision, ignoring the
myriad difficulties which arise in policy execution. Probably the main achievement of policy
analysis has been to direct attention to these problems of implementation. Even today, putting the
policy into practice is sometimes still regarded as a technical matter of administration. Turning a
blind eye to implementation issues can be politically convenient for ministers but is always
dangerous and can be damaging.
The decision on a specific course of action and the adoption of a program does not guarantee that
the action on the ground will strictly follow policy makers‘ aims and objectives. The stage of
execution or enforcement of a policy by the responsible institutions and organizations that are
often, but not always, part of the public sector, is referred to as implementation. Policy
implementation is broadly defined as ―what happens between the establishment of an apparent
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intention on the part of the government to do something, or to stop doing something, and the
ultimate impact in the world of action‖. This stage is critical as political and administrative
action at the frontline are hardly perfectly controllable by objectives, programs, laws, and the
like. Therefore, policies and their intentions will very often be changed or even distorted; its
execution may be delayed or even blocked altogether.
An ideal process of policy implementation would include the following core elements:
 Specification of program details (i.e., how and by which agencies/organizations should
the program be executed? How should the law/program be interpreted?);
 Allocation of resources (i.e., how are budgets distributed? Which personnel will execute
the program? Which units of an organization will be in charge for the execution?);
 Decisions (i.e., how will decisions of single cases be carried out?).
The detection of the implementation stage as a missing link in the study of policymaking can be
regarded as one of the most important conceptual innovations of policy research in the 1970s.
Earlier, implementation of policies was not recognized as a separate stage within or element of
the policy-making process. What happens after a bill becomes a law was not perceived as a
central problem—not for the decision makers and, therefore, also not for policy analysis. The
underlying assumption was that governments pass laws, and this is where the core business of
policy-making ends.
The implementation of policy usually carried out by legislature, court, pressure groups ,
community organizations, Administration organizations or bureaucrats etc.
5.3.5 Policy Evaluation and Dimensions of Evaluation

This is the last stage of the policy process. It involves an attempt to determine whether a policy
has actually worked. It is essential to monitor formulated policies during implementation.
Monitoring involves the assessment of progress on policies, programmes and projects in
comparison with what was initially planned. Its object is the detection of deviations, so that
corrective measures could be applied. Evaluation, on the other hand, is concerned more with
results of a policy or programme. It tries to determine the relevance, effectiveness and impact of
policy and programme activities in the light of their objectives. It is also concerned with the
efficiency within which programmes are implemented. Such an evaluation can lead to additional
policy formulation to correct deficiencies.
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Generally speaking, policy evaluation is concerned with the estimation, assessment and appraisal
of a policy. Policy evaluation involves the contents, implementation and effect of the policy. As
a functional activity evaluation can or does occur throughout the policy process not simply as it‘s
a final stage. For instance an attempt is usually made to determine the consequence of various
policy alternatives for dealing with the problem prior to the adoption of the policy.
Anderson, Brady and Bullock, (1978) categorized evaluation in two ways:
 Political evaluation to assess the political feasibility of the policy;
 Systematic evaluation seeks to objectively measure the impact of the policies and
determine how well objectives are actually accomplished. Such an evaluation focuses on
the effects which a policy has on the problem to which it is directed. Systematic
evaluation must address question related with; is this policy achieving its objectives?
What are the cost and benefits? Who are its beneficiaries? What happed as a consequence
of the policy that wouldn‘t have happened with its absence? Systematic evaluation gives
the policy makers, people and other interested body about the actual impact of policy.
Policy-making is supposed to contribute to problem solving or at least to the reduction of the
problem load. During the evaluation stage of the policy cycle, these intended outcomes of
policies move into the center of attention plausible normative rationale that, finally, policy-
making should be appraised against intended objectives and impacts forms the starting point of
policy evaluation. But, evaluation is not only associated with the final stage in the policy cycle
that either ends with the termination of the policy or its redesign based on modified problem
perception and agenda-setting.
At the same time, evaluation research forms a separate sub-discipline in the policy sciences that
focuses on the intended results and unintended consequences of policies. Evaluation studies are
not restricted to a particular stage in the policy cycle; instead, the perspective is applied to the
whole policy-making process and from different perspectives in terms of timing (ex ante, ex
post).
5.3.5.1 Problems in Policy Evaluation

The most useful form policy evaluation for policy makers, administrators as well as for policy
critics, who wish to a factual basis for their position, is systematic evaluation that tries to
determine the cause and effect relationships and rigorously measure the impact of policy.
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Determining whether a policy program is doing what is supposed to do is not an easy

straightforward task.
A. Uncertainty over policy goals
When goals of a policy are unclear, diffused or diverse, determining the extent to which they
have been attained becomes a difficult and frustrating task. This situation is often the product of
policy adoption process.
B. Difficult in determining causality
Systematic evaluation requires that societal changes must be demonstrably caused a policy
action. The inner fact that when action A is taken condition B develops doesn‘t necessarily mean
that the cause and effect relationship exists. Other actions or variables may have been the actual
causes of conditions B. therefore; it is usually difficult to determine causality between policy
action and other societal changes which are supposed to be the consequences of the policy.
C. Diffuse Policy Impact
Policy actions may affect groups other than those at whom they are specifically directed. A
welfare program for example may affect not only the poor but also others such as tax payers, low
income people who are not receiving welfare benefits. The effect on those groups may be
symbolic or material. Tax payers may grumble that there hard earned dollars are going to support
those too lazy. Some low income working people may decide to go on welfare rather than
continue working at unpleasant jobs for low wages. So far as the poor who receive material
benefit are concerned, what effects do benefits have on their initiative and self-reliance, on
family solidarity and on maintenance of social order? The effect of some policy or programs may
be very broad and long range in nature.
D. Difficulties in Data Acquisition
Shortage of accurate and relevant statistical data and other information may handicap the policy
evaluator. Therefore, absence of adequate data and information makes difficult the policy
evaluation process and it also makes the policy evaluation very incomplete.
E. Official Resistance
The evaluation of policy, the measurement of policy impact involves making of judgments on
the merit of policy. This is true even if the policy evaluators are experts or university researchers.
Agency and program officials are going to be concerned about the possible political
consequences of the evaluation.
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F. Limited Time Perspective

Public officials and other often requires quick results from governmental programs, even social
and educational programs whose effects may take longer time. As a result short run evaluation of
programs may be unfavorable. If time dimension is ignored in evaluation studies the result may
be flawed and neglect important impacts. The pressure for rapid feedback concerning a policy
can create a dilemma for the evaluator.
G. Evaluation Lack Impact
Once completed the valuation of the program or policy may be ignored or attacked as
conservative or unsound on various grounds. For example it may be alleged that the evaluation is
poorly designed, the data used were inadequate or the findings are inconclusive.
Chapter Six
Policy change and continuity

Introduction
Here an attempt is made to discuss various approaches to studying the way in which policy
changes takes place. As it is known policy evaluation involves some kind of feedback in to the
policy process which results in change in policy.
Evaluation often acts as an engine of policy change. There are generally two aspect of analyzing
change.
i. How does change in policy goals, purposes, and priorities take place?
ii. What is the relationship between changing goals, values and etc. and organizational
context of policy and vice versa?
Three approaches have been suggested to examine these two dimensions of policy change:
i. Policy Cycle Approaches.

ii. Organizational approaches.
iii. Policy change and policy learning models.
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6.1 Policy Cycle Approaches

Under the policy cycle, May and Wildavsky(1978), Hogwood and peters (1985), de Leon
(1987) and Hogwood (1992) examined the policy change. Policy change is the consequences
of earlier policies which may have changed the conditions. New Policy, therefore, frequently
emerges from the existing policy or overlaps with on-going programmes.
Brain Hogwood and Guyi Peters suggest a model of policy change as given below:
Policy Innovation: when government becomes involved in a problem or an area which is
―new‖. Given the fact that the modern policy space is very crowded, new policy is likely to be
framed within the existing related policies.
Policy Succession: Involves the replacement of the existing policies by other policies. The
change doesn‘t involve any fundamental change in approach, but it is continues with the
existing policy.
Policy maintenance: is the adaptation of policies, or adjustments to keep the policy on track
Policy Termination: is the flip side of innovation. In termination a policy or a programme is
abandoned, wound down and public expenditure on that policy is cut. It is a dead policy, a
policy that has ceased to be an ex-policy.
They argued that policy change will take place within the context of policy succession and in
a domain between innovation and maintenance, maintenance and termination.
Succession Innovation Maintenance Termination
Replacement of existing policies new policies Types of policy growth Types o f policy Reduction
 Linear *Programme extension *E xternally generated decline

 Consolidation *clientele extension *Dilution and deterioration
 Splitting *programme enhancement * Remo val of Clientele
 Non-linear *Indexing *Elimination of a program element
* Externally generated expansion *Elimination of a programme
Figure: Hogwood and Peter‘s Model of Policy change
To Hogwood and peters there are four types of policy succession:

i. Linear: The replacement of existing policy by another policy
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ii. Consolidation: consolidation of a number of policies into a unified framework.

iii. Splitting: splitting a policy into a number of separate component parts.
iv. Non-linear
6.2 Contingency Approaches

For contingency theorists such as Woodward, Lawrence and Lorsch, it is important to understand the
way in which organizations change to meet the growing demands of different environments and
technologies.
This approach points to the importance of organization shaping itself to fit its wider environment. Its
focus is on impact of environment and technology on the organization. However this theory doesn‘t
consider the issue of power. The main source of change in the public sector organizations comes
from decision makers who have the power and authority to bring about change. Here two critiques of
the contingency approaches of Woodward and of Lawrence and Lorsch have a relevance to explain
how and why change comes about in the organizations:
a. Strategic Choice approach
b. Population ecology approach
Strategic Choice Approach: according to John Child, who is the exponent of strategic choice
approaches, change in an organization is an essentially political process. He argues that bureaucrats
and politicians form a dominant coalition, shape the organization‘s structure and objectives. They
have also the capacity to influence the conditions prevailing by manipulating the environment (what
markets to enter). Under the contingency approach the aim is to bring about a better fit with the
environmental conditions.
Population Ecology Approach: population ecology approach rejects the idea that organizations
have the power to fit themselves to the environment which contingency approach argues. On the
contrary population ecology approach focuses on the power of the environment to determine
organizational change (the idea of fittest survival prevails).
In this organizations have to obtain the necessary resources in order to survive, failing which they
decline or die. With strategic choice, the population ecology approach lends itself to understand the
way in which organizations change. For example, the public sector management has followed the
practice of management in the private sector to improve its functioning.
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Di Maggio and Powell offer a framework which proposes that change comes about as organizations
are shaped to resemble other units which face the same conditions. Their model supposes that
organizations exist in the field of ―supplier, resource and product consumers, regulatory agencies
and other organization that produces similar services or products‖. According to Di Maggio and
Powell, organizational change may take place through three mechanisms:
i. Coercive: formal or informal pressures which are exerted on organizations by the other
organizations upon which they are dependent. It also includes cultural expectations in the
society within which the organizations are located
ii. Mimetic: in conditions of uncertainty, the change may be the result of copying or imitating
other organizations which are seen as offering a solution or model.
iii. Normative: professionals operating in organizations may change their organization so as to
ensure that they resemble the preferred or dominant organizational pattern in the field.
This isomorphic approach provides a framework for understanding the pressures which are shaping
between the voluntary and public and private sectors. The professionals act to shape organizations so
that these have a uniformity and similarity which facilitate movement and professional standards.
Thus strategic choice would argue that it is the decision making coalitions that have the power to
bring about change in the environment. On the contrary resource dependency would argue that it is
the power of the environment which determines organizational change.
6.3 Managerial Approach to Change

In recent years Managerial approach to change in public sector has come to occupy an important
place in the debate of change. Within this domain two central ideas tend to predominate: Culture and
Leadership
i. Cultural Change: the managerial approach has laid emphasis on changing the culture in public
sector so that it is more business-like and less bureaucratic. The cultural approach lays
emphasis on the importance of beliefs, values, attitudes, norms, in the analysis of how
organization works, rather than the environmental factors.
ii. Leadership Role: the managerial approach has led neat stress on the role of leadership in
bringing about change in the organization. In conditions of rapid change and uncertainty the
public sector may follow the private sector in managing change in terms of culture and
leadership.
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Kaufman is concerned with understanding the relationship between change and conflict with a view
to managing change successfully. According to her the process of change will involve different
stakeholders with varying levels of power, representation, resource, and kinds of relationship. It will
also be shaped by the environment and decision rules overtime. Further in order to manage conflict,
stakeholders will engage in a unilateral moves (such as Litigation, appeal to rules and press release)
and joint moves which involve communication mediation, and negotiation.
6.4 Policy Learning Model

Sabatier and Jenkins-Smith suggest that the key to understand policy change is the dynamics of
beliefs and policy learning. The learning model provides an integrative framework for viewing
change in the policy process. Two models may be identified here: the organizational learning
models and social learning models.
6.5 Organizational Models of Learning

The focus in organizational models of policy learning is on the way in which People and policy
makers in the organizational context learning. The learning approach has been most developed by
Sabatier and Jenkins-Smith in addition there are many others who talk about learning to the policy
process.
Argyris and Aschon argue that in the organization there is on the one hand pressure for its stability
and on the other hand the necessity for change. This creates a confusing environment in which
individuals have to think defensively and competitively on the one hand and functional
cooperatively on the other hand. Organizations, according to them, tend to function under model I
behavior.
Model 1, single loop: in this model individuals are driven by the desire to pursue their goals, reduce
their dependence on other, keep their ideas and feelings to themselves and protect themselves from
change. Learning in this model is self-contained and self-oriented. Its aim is to defend the position of
the individual. It is a model of learning which produces conformity, mistrust, inflexibility and self-
sealing. Hardly, it is a model to facilitate change and adaptation.
Argyris and Aschon have proposed a new approach which provides for ―double loop‖ learning
process.
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Model 2 double loop: This model involves the cultivation of decision making based upon openly
obtained information, taking action with other. Model 2 involves joint inquiry and a restructuring of
organizational norms, strategies and assumptions to foster an organization responsive to change.
As against defensive model which pollutes the decision making system and is hostile to change, the
model 2 provides the conditions for change and adaptation. They argue that the aim of management
should be to promote an environment in which ‗double-loop‘ learning occurs.
Les Metcalfe developed his ideas on the relevance of the learning model to define a distinctive form
of public sector management in the 1960s.
―In the political environment of public management learning processes are especially difficult to
create and maintain. Individual learning is a psychological process. Organizational learning is a
political process. A critical task of public management is to build institutional learning capacities at
the macro level to manage the environment in which private management operates. But,
conventional political processes often block learning because ideology overrides evidence or vested
interests resist policy evaluation and change… public management reforms are better regarded as
management by design rather by direction. It should be concerned with designing adaptable systems
rather than producing blueprints specific reform‖.
Browne and Wildavsky have developed a theory of evaluation and implantation as an ongoing
learning process: as self-evaluating process. Lindblom focuses on learning as a means of reducing
impairment in the policy making process.
To David Collingridge, learning is a trial and error process. He advocates the use of trial and error
method for improving the tasks of management. The rules of the trial and error method are:
i. Trials are kept to a minor nature, thus being expensive even when they fail;
ii. Changes are marginal in nature ;
iii. Trials have a rapid result;
iv. The energy of critical scrutiny is to be proportional to the cost of mistakes;
v. Many diverse interest groups take part in the decision process;
vi. Political power is shared among these groups;
vii. Choice is through compromise amongst these groups;
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viii. Actions are co-ordinated by mutual interaction rather than planned from the center.
This method does not offer a distinct normative framework for policy making. In this method,
concept fails to provide a satisfactory account of what is happing in the post decisional phase of
policy making.
6.6 Social Learning Models

The social process approach is concerned with the way in which learning takes place in society
as a whole, and how this learning can be promoted. Edgar Dunn called for the development of
forms of organizations.
Chapter Seven
Globalization of National Policy Making: An International Perspective
Introduction
Policy-making is an extremely analytical and political process which involves a complex set
of forces. It begins with the ideas people or interest groups have about the actions they want the
government to take. In other words, these are the demands or proposals made by interest groups
or by other actors upon the political system for action or inaction on some perceived problems.
Public policies are being conditioned everywhere by the external environment [19, p. 95-96]. It
is impossible to separate the external environmental factors, as they invariably influence the
political processes and policy outcomes. The influence, being brought to bear on socio-economic
problems of a country by agencies (WHO, ILO, UNEP, UNDP, etc.), the World Bank, the
International Monetary Fund, the European Policy Forum, the Organization for Economic
Cooperation and Development (OECD) and the European Central Bank, etc., is of critical
importance in shaping its policies.
7.1 The Impact of Global Events on National Policy Agenda

Developing countries are particularly vulnerable to global events and actions and have come
to depend heavily on the international community for financial and technical assistance.
Consequently, national policies are interlocked with global issues. As Landell Mills and
Serageldin state, ―Because poor countries generally have fragile politics and weak systems of
accountability, with few autonomous institutions and little power to offset that exercised by the
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central government, external agencies are potentially key political players, capable of exerting
considerable influence […]‖. The boundaries of the political system are no longer impermeable
to outside pressures and influences. Public policy now takes place in a world system as well as in
national political systems. The international environment has an added role to play in influencing
the national policies. The mass media and international conferences ease the process of policy
diffusion. Harrop notes that ―The international environment forms much of the context of
national policy-making. Policy-makers in each country share a policy context formed by the
international economic cycle of prosperity; recession depression and recovery […] International
organizations such as the EC also form an increasingly important part of the context of national
policy-making. The policy agenda is also becoming international‖.
As multinational corporations and international organizations come to exercise a great degree
of influence, so the capacity of national policy-makers to frame their own agendas in reduced.
National issues, such as social welfare, environment, drugs and trade, are items on the national
policy agenda which have become global issues. This has been accompanied by increasing
transnational cooperation. National policy agenda in a developing country of Iran is now exposed
to developed countries. With globalization, there is a greater scope of interaction between a
nation state and other countries. A nation state has now come to exercise less control on policy
agenda than it was in the second half of the twentieth century. From the national perspective, this
means that the policy agenda may be global, but the policy-making and implementation remain
national. Thus, there is a new kind of inter-play between transnational companies and the
national and world economies. Global issues interact with national issues, which, in turn, interact
with the local level. Globalization posits that these layers are becoming even more interactive
and permeable and that a new policy is emerging. For example, in European context, a new
policy level is developing in terms of Europeification of national policy-making Europe‘s
common currency (Euro notes and coins issued by the European Central Bank from 1 January
2002) is expected to open the way to a closer political union among European nations.
Similarly, most developing countries undertook significant liberalization of their trade
regimes during the late 1980s and the 1990s slashing tariffs, reducing non-tariff barriers to trade,
and privatizing public enterprises under the pressures of the World Bank and European countries.
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7.2 The Need for a Global Perspective

It may be noted that the nation of World Politics was central to Harold Laeewell‘s
conception of the policy sciences. In 1951, Lasswell argued that policy sciences should take
account of world trends and forces when considering the context of policy problems. He
maintained the following: ―Indeed, one of the major tasks of the policy sciences today is to
follow in detail the processes of social invention, diffusion, and restriction throughout the globe
for the sake of estimating the significance of specific events‖. Writing in 1968, Lasswell also
maintained that ―As the globe shrinks into interdependence, relying more fully on science and
technology, the policy sciences gain significance […] Interdependence implies that every
participant and every item in the social process is affected by the context in which it occurs.‖
Similarly, Etzioni in 1968 also observed that there was a rising interdependence between
nations and economies. But he also felt that ―Surprisingly, many social scientists tend to
overplay that nation-state as the unit of societal analysis and underplay supranational bonds and
controls; above all they tend to take the nationalistic moral community as the community of
values‖.
7.3 Determinants for Globalism

As it has been already maintained, the country‘s ―political system‖ also functions within the
―world system‖. The boundaries of the political system are no longer impermeable to outside
pressures and influences. The world has become a single social system as a result of growing ties
of interdependence. The point is that there is a new kind of interplay between transnational
companies and the national and world economies. To Giddens, transnational corporations,
growing economic integration and the globalization of communications and media are major
factors that make for globalism. Globalization as a term has gained wide attention and
recognition. To Albrow, globalization refers to ―all those processes by which the peoples of the
world are incorporated into a single world society, global society‖. He further says that
―globalism is one of the forces which assist in the development of globalization‖. The
implications of the nation of globalization are that policy-makers must consider agenda
formation and problem definition within a global context. The ―policy-makers in each country
share a policy context formed by the international economic cycle of prosperity, recession,
depression and recovery‖. In a global environment, it is possible to speak of the convergence of
concerns for which global strategies may be formulated. As such, in a global context, more and
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more issues will be structured by larger forces outside the nation‘s constitutional framework of
public policy-making.
7.4 Policy Agenda in a Global Context

It is important for policy-makers to take account of global issues when considering the context of
policy problems in national setting.
Environment
Pollution of the air and water, destruction of forests and loss of fertile soil are becoming critical
problems with serious consequences for health, food production, productivity, and perhaps even
the ability of the earth to support human life. Protection and improvement of the quality of the
environment has become a global issue since 1980s.
To Porter and Brown, the environmental issue is increasingly penetrating policy issues, such as
international security, North-South relations and world trade. Their study shows how the issue
has involved the development of new levels of interactions among states to form a ―global
environmental regime‖. Because of a growing global environmental stress, there is a sustained
pressure on national policy-makers to change or modify their policy positions.
The World Commission on Environment and Development (WCED) observed the following:
―The traditional forms of national sovereignty are increasingly challenged by the realities of
ecological and economic interdependence. Nowhere is this more true than in the shared
ecosystems and in ―the global commons those parts of the planet that fall outside national
jurisdictions‖.
Industrial growth places pressures on policy-makers to prevent control pollution. International
agreements on ways to control pollution and close ties between environmentalists have provided
an exchange of information that shapes the policy agenda. The United Nations Conference on
Environment and Development in Brazil in June 1992 produced treaties to control global
warming and preserve the diversity of species. The meeting issued the Rio Declaration, setting
forth broad principles of environmental protection and sustainable development, and Agenda 21,
a detailed plan for combating various environmental problems. In sectors, such as land, fresh
water, forests, biodiversity and climate change, the 1997 UN assessment found that conditions
either were no better than in 1992 or had worsened.
Poverty and Population Growth
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Developing countries are facing increasingly serious population growth and poverty problems.
Despite lower poverty rates, the number of poor people has increased largely because of
population growth in developing countries, as well as uneven development, and increasing
concentration of wealth.
Almost half of the world‘s population (approximately 2.5 billion) lives on less than $ 2 a day,
and one fifth of the world‘s population (approximately 1.4 billion) live on less than $ 1.25 a day.
This horrific level of poverty persists despite unprecedented increase in global wealth in the past
century. As the 21st century begins, a growing number of people and rising levels of
consumption per capita are dimensions of poverty.
Poverty and population growth have now become global issue. The World Bank‘s (WB) new
strategy proposes, for example, an approach to fighting poverty. The three-pronged approach of
the WB focuses on increasing opportunities for people, facilitating their empowerment and
enhancing their security. Policy-makers and environmentalists now largely agree that efforts to
reduce poverty and population growth and to achieve better living standards can be closely
linked and are mutually reinforcing. The policy agenda at the global level is now slowing the
increase in population and attacking poverty.
Most countries, especially developing ones, have come out with national health policies, which
are global in context. As diseases have no barriers, there is the need for international cooperation
and national political action by turning statements of principle into specific policies and actions
throughout the world.
Family planning is seen as a strategy to reduce population growth. The 1994 International
Conference on Population Development (ICPD) programme of action states that ―the aim of
family planning programmes must be to enable couple and individuals to decide freely and
responsibly the number and spacing of their children‖ with a view to reducing population size.
Governments of nations that sign international documents of principles make a commitment to
act on these principles. The extent of government attention to such commitments and the amount
of money allocated to implementing them, however, vary considerably around the world.
AIDS
AIDS as a communicable disease has become a serious concern to the international community.
ADIS has already killed more than 20 million people, and today 35 million people are living
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with HIV/AIDS, 23 million of them alone are living in Sub-Saharan Africa. Every day another
7,000 people are infected. And around the world, the epidemic is having a huge effect on GNP.
Since it is a global issue, the policy analyst must find a global solution involving a coordinated
international cooperation and national political action. Iohnatan Mann, the Director of the
WHO‘s AIDS Programme, stressed that AIDS has been bringing about a ―new paradigm of
health, because of four factors: ―it is a global problem; it is understood and spoken as a global
problem; and it is known worldwide; and AIDS is combated at the truly global level‖.
Drugs
The use of drugs has become an equally global concern. Earlier, it was regarded as a social
problem and the focus was on seeking a national policy. However, since 1980s drug use has
posed a serious menace to the international community and it requires a global cooperation and
action. The international concern has addressed the supply and transportation of drugs from the
producer nations, such as Thailand, Afghanistan, Pakistan, Columbia, Peru and Bolivia.
Trade and Industry
Changes have occurred in industry as a consequence of global changes and shifts. The major
sources of global shift are transnational corporations which organize production on a world-wide
scale, the policies pursued by national governments and the enabling technologies of transport,
communication and production. This has largely weakened the ability of national governments to
make policies independently of those changes. Dicken observes the following: ―[…] the well-
being of nations, regions, cities and other communities depends increasingly merely on events in
their own backyards but on what happens at a much larger geographical scale […] we need a
global perspective‖.
Yet nearly 80 countries containing a third of the world‘s population are being increasingly
marginalized, and over the past 20 years developing countries‘ share of global trade fell from 0.8
to 0.4 percent. The fact is that 2.5 billion people live on less than $ 2 a day, and 1.4 billion live
on less than $ 1.25 a day. In this way, international development cannot be achieved.
However, national policy-makers have the task of formulating policies which help create
business climate. The global industrial environment interacts with the national political
processes, and consequently, national policies are increasingly influenced by activities and
events happening well away from the national context. So, the capacity of the national policy-
makers to frame their own agendas is considerably reduced.
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Privatisation
The beginning of the 1990s witnessed a marked privatization instead of government control.
There has been a renewed emphasis on privatization and competition throughout the world.
Governments of most countries, both developed and developing, have adopted policies of (1)
transferring government – controlled enterprises to have private sector; and (2) opening up a
large number of industries to the private sector to encourage competition. Privatization is now
fashionable in European community, South and North America, Australia, Asia, Africa, and is
gaining popularity in Eastern Europe.
The concept of privatization is ambiguous, as it may imply severe reductions in the size of the
public sector and a drastic shrinkage of public ownership ofkey industries. Privatization is being
driven by the shift of important economic sectors to operation on a global scale. National policy
agendas are being shaped by forces of global economic restructuring.
Terrorism
Terrorism is another global problem, which is spreading like a cancer. In Iran, examples of
terrorism are Hypocrites group (MKO), Jundullah in Sistan and Baluchistan Province, PJAK
group in west of Iran. In the world, Al-Qaeda, Taliban, Revolutionary Armed forces of
Colombia, Ansar al-Sunnah Army, Basque Fatherhood and Freedom are operating as terrorist
organizations. Attacks on the World Trade Centre and Pentagon in the United States on 11
September, attacks on India‘s Parliament on 13 December in 2001, bombings of three subway
trains and one bus in the UK on 7 July 2005 and an attack by bombing to Islamic Republic Party
office in Iran on 1 October 1982 are four important dates that made the whole world realize that
terrorism had challenged the world community.
Sabharwal observed that ―Our main enemy in the twenty-first century will be terrorism.
Terrorism organizations or countries using them as a front could explode a stray nuclear warhead
or carry out biological or chemical attacks which in turn could cause a chain reaction and bring
the world to the brink of destruction‖.
There were several wars in the last century, including two World Wars, but the first decade of
this century saw a radically different scenario – highly motivated groups of people launching
attacks on nation-states. The shadowy figure of the terrorist has loomed large in homes and
outside, menacingly.
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Now, there is the need for global cooperation for fighting global terrorism. For this aim, in
September 2006, the UN General Assembly adopted the Global Counter- Terrorism Strategy.
Then, between November 2010 and May 2012, the Office of the UN Counter-Terrorism
Implementation Task Force (CTITF) was established. Also, recently, the second global
conference of the national focal points has been held in Geneva, entitled International Counter-
Terrorism Focal Points Conference on Addressing Conditions Conducive to the Spread of
Terrorism and Promoting Regional Cooperation. Today, countries more than any other time have
concluded that they cannot stand alone to fight with this phenomenon. Therefore, more and more
are encouraged to international cooperation. An example of such international cooperation is
Iran‘s recent cooperation with Argentina about identifying the perpetrators of terrorist explosions
in the AMIA Trade Center.
Other Global Issues
It may be added that the world is becoming reluctantly internationalist, recognizing that the
diversity of domestic social and economic issues (social welfare, trade, industry, agriculture,
health, education, nuclear war, famine, etc.) is an item on the national political agenda, which is
tied up with global issues. This has been accompanied by growing regionalization and
internationalization. The global environment forms much of the context of national policy-
making.
Generally it is largely felt that in developing democratic countries policy agenda is driven by
global forces. Problems arise in a context in which economic and social conditions play a major
role in shaping opinions and political strategies. For example, the economics that stuck with the
planning model experienced slow growth, stagnation, or worse; the collapse of the socialist
economies was but ―the final nail in the planning coffin‖. By the 1990s, countries around the
world were actively engaged in privatizing public enterprises. But the power of decision or
policy and the capacity to implement it remains largely within the nation states. There is,
therefore, a tension between the spillover, which may be said to be taking place at the global
level and the reality of the maintenance of national sovereignty. Against the pressure of global
agenda, the fact remains that at times of crisis ―governments are prone to withdraw from
intergovernmental cooperation and supranational policy-making rather than move positively into
closer collaboration‖. A common issue and problems within a global context may be increasingly
identified in international terms, but decision-making and implementation still remain largely
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within nation states. The global socio-economic framework interacts with the political processes
and policies pursued by governments of nation states. The success of nation states in policy
performance will diverge notwithstanding the convergence of the global policy concerns.
Chapter 8
An Overview of Public Policy Making in Ethiopia
8.1 Background perspectives on the historical, politico-cultural and

institutional antecedents to public policymaking in Ethiopia
Politico-cultural antecedents
Ethiopia‘s past (its history and the traditional institutions developed in the course of time) have
had an enormous impact on state-society relationships with respect to policymaking. The
traditional values and institutions appeared to have encouraged neither open opposition nor
reasoned criticism of government authorities, nor the policies that they unilaterally adopted. It is
argued, therefore, that deep-seated traditional and indigenous political forms that have long been
rooted in the past have vital relevance in explaining state-society relationships and the dynamics
of public policymaking in Ethiopia.
Therefore, having a good grasp of the historical, social and cultural circumstances will be of
paramount importance in understanding the dynamics of public policymaking in Ethiopia.
Minilik II was the Emperor who oversaw the country’s expansion to the south, the restoration
of the medieval territories and the unification of Ethiopia, as noted above. The treaties that he
concluded with the colonial powers that had colonial territories bordering on Ethiopia – such as
Italy, France and Britain – earned him the recognition of the country’s sovereignty. However,
the success in territorial gains in the course of internal conquest, expansion and resistance to
external colonial expansions brought with it and bequeathed to the succeeding generations the
notion that the use of force could be largely recognized as a major instrument of control and
domination. Over the years not only has this been gradually ingrained in the belief system and
values of the policy elites in Ethiopia, but also has it been promoted by the cultural and social
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structure of traditional Ethiopia. The Solomonic myth, for instance, purportedly established the
ruling line of Ethiopia into blood relationship with the House of David and ultimately with
Christ. The people were persuaded to believe that Solomon’s descendants, such as Emperor
Haileselassie, should rule over Ethiopia, because they were divinely ordained. Chapter I, article 1
of the first Ethiopian constitution provided: ‘the Imperial dignity shall remain perpetually
attached to the line of His Majesty Haileselassie I, descendant of King Sahleselassie, whose line
descends…from the dynasty of Minilik I, son of King Solomon of Jerusalem and of Queen
Sheba of Ethiopia’. Thus, Emperor Haileselassie, who ruled Ethiopia for half a century, used
the following titles in policy documents and official appearances: ‘Conquering Lion of Judah,
Haileselassie I Elect of God, Emperor of Ethiopia’. Additionally, not only did the Solomonic
legend find its spiritual justification in the Ethiopian Orthodox Church, but the latter also
campaigned to inspire awe among the Ethiopian populace. The people were preached into
believing that, although the ultimate source of authority is God, its worldly exercise was
bestowed up on the emperor.
Therefore, not only was authority claimed to have originated from the pinnacle of the hierarchy
and the direction of its flow downward, but also the excessive respect accorded to authority made
it difficult, and even impossible, to express any opposition to a superior. This was even more
complicated by the hierarchical nature of the politico-administrative structure and the
predominantly feudal socio-economic formation. Ethiopian society has long been ruled by a
hierarchical politico-administrative order, with public institutions operating under the monarchy
(Meheret, 1997: 64). Since land was the basis for status and wealth, the monarchical structure
had to sustain and adapt to modern bureaucratic institutions by extracting surplus from the mass
of the peasantry. The basic components of the social system were the monarchy, the landed
aristocracy, the clergy and the mass of rural farmers (ibid). However, the traditional polity had to
strike a balance between the landed nobility and the modern educated elites, in which case a
measure of adaptation had to take place in order to preserve the stability of the monarchical
structure and exercise control in the face of continuing social and administrative changes. The
process of adaptation not only integrated educated elites into the apparatus of the administrative
structure, but it also become instrumental in the process of centralization that Haileselassie’s
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regime had pursued ever since his ascension to the throne. Centralization was accomplished
through the partial modernization of state apparatus, and thereby establishing the basis of the
elite status of the educated group (Clapham, 1969; Markakis, 1974; Bahiru, 1991). In the last
years of the imperial era, the incorporation of the educated group into the politico-administrative
structure not only had changed the monarchy into a veritable autocracy, but also this very
adaptation engendered an imperial-bureaucratic elite structure (op. cit).
Hence, most Ethiopians have long been captured by traditions deep-seated in their sociopolitical
cultures that defined the relations of the state to the society in authoritarian terms. The only
politically active groups were those in the upper-most hierarchy of the government institutions.
Authority was treated with the utmost respect, and a person holding it was received with
reverence; thus, he could neither be challenged nor was there any reasoned criticism of policy
proposals possible. Most Ethiopians had profound reverence for their great men, above all for
their monarch, and to them it was considered as a diminution of that greatness for the
subordinates to take decisions and perform actions entrusted to their superiors (ibid). For the
latter, too, delegating ones authority was unlikely, because doing so could be seen as lowering of
the status of the superior in the eyes of the subordinates (op. cit). These entrenched feelings
might have gradually changed over the past three decades, though they have been influencing
remarkably the broad spectrum of public policymaking and relationships between state and
society. Furthermore, policy and political problems have hardly been resolved through open
debate and compromise; rather authority and the use of force have more often than not been used
to discourage even the most ordinary disobedience and dissent. Except for the privileged few, the
bulk of the people remained apolitical. Nor was there any right to form associations. Till very
recently neither transfer of power nor change of government were resolved peacefully. In the
Ethiopian context, therefore, resorting to a violent mechanism of ascertaining political power and
asserting one’s domination has been integral in socio-political culture and history. History and
culture also have an enormous influence on the dynamics of public policymaking and state-
society relationships in contemporary Ethiopia.
In summary, major social and economic policy decisions affecting citizens and the country were
conceived and made by the emperors and palace courts. Not only were the administrative.
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personnel who executed policies protégés of court officials of higher order, but they were also
groomed to implement policies and decrees with absolute obedience. Moreover, the feudal order
had long been the bedrock of the Ethiopian socio-economic order. In its worst form the feudal
order nurtured a culture of subjugation and inculcated absolute compliance with the decisions
made by the imperial court. Not only was the power of the emperors and nobility unchallenged,
but citizens also had no say in policy matters. In pre-revolutionary Ethiopia socio-economic
power and/or status were dictated by one’s possession of large tracts of land (Bahiru, 1991).
Emperors allocated land to the nobility and loyal subjects as patronage. The landlords,
government officials and the Orthodox Church owned the bulk of land, and controlled the lives
of millions of the peasantry. The latter had no legal, economic and political rights. The fact that
state-society relationships and the structure of policymaking evolved from and were determined
by the prevailing socio-economic order meant not only that the ordinary citizens’ participation
in the policymaking process was virtually undermined, but also that independent civil society
groups had no chance of entry into the narrow circle of the policymaking process. In short, the
client-patron relationship that has over the past several hundred years been developing between
the state and society tends to haunt the structures and institutions of public policymaking in
Ethiopia to this day.
8.1.1 Institutional antecedents: Haileselassie’s period

To begin with, the 1931 constitution was a landmark in the history of Ethiopian public policy,
not only because the first constitution was promulgated, but also because the first bicameral
parliament convened immediately after the constitution was promulgated. The first constitution
resembled in part that of the Japanese Empire of 1889, which in turn was similar to the
constitution of 1871 of the German Empire (Redden, 1966; Assafa, 2002). Looking back to the
time (i.e. 1931) when parliament was founded, nearly all sub-Sahara African states were still
under colonial rule. It is probably not surprising to see a legislature whose powers had been
circumscribed entirely. Nor was it expected to represent the basic repository of the authority of
the people or supreme policymaking body of the state. The emperor had unrestricted
constitutional powers, extraordinarily exceeding the power of the legislators, including the power
to declare war, appoint judges, dissolve parliament, negotiate as well as sign treaties (Meheret,
1997: 86). The gist of the matter lies in article 6 of the constitution: ‗In the Ethiopian Empire
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supreme power rests in the hands of the Emperor‘. Hence, the parliament was neither meant to
carry out the usual functions of an elected legislature, nor was it a source of pubic authority.
The 1931 constitution concisely defined the structure of the legislature to consist of two
deliberative chambers. The Chamber of Senate or upper house (Yeheg Mewesegna Mekerbet)
was to consist of members appointed by the emperor drawn from among the nobility ‗who have
for a long time served his Empire as Princes or Ministers, Judges or high military officers‘
(Article 31). Till the people are in a position to elect the members of the Chamber of Deputies or
lower house (Yeheg Memria Mekerbet) themselves, the constitution stated, the nobility and local
chiefs shall designate them (Article 32). The bulk of the 1931 constitution, nevertheless, was
devoted to stipulating the power of the monarch, with the virtual power of initiating laws and
policies resting in the person of the emperor.
Promulgated in November 1955, the revised constitution appeared to state some provisions
giving the lower house (Chamber of Deputies) a power base separate from the emperor. In much
the same way as the 1931 constitution, however, while the Senate remained an appointed
chamber with members still chosen from among the nobility, dignitaries, the clergy and other
prominent personages assigned to sit for a 6-year term by the emperor, members of the lower
house (Deputies) were elected by universal adult suffrage for a four-year term (Revised
Constitution, 1957). Unfortunately, a strict wealth requirement imposed on candidates coupled
with the absence of a party from which Deputies could have drawn organized inspiration forced
the MPs to rely on government patronage for re-election (Lipsky, 1962; Clapham, 1969). Nor did
they put up any challenges to any legislative proposals originating from the executive. In fact,
the powers of the monarch were even more precisely sharpened in the revised constitution than
in the first constitution promulgated in 1931. It vested a multitude of powers of vital importance
in the emperor. Not only did it invest sovereignty of the empire in the emperor with the power to
determine the organization, powers and duties of all government departments, and to appoint and
dismiss government officials, but he also had absolute control over the armed forces with wide
ranging emergency powers (Articles, 26, 27 and 29). Apart from this, the emperor had absolute
control over foreign relations, the power to dissolve the parliament and to reverse the decisions
of the courts and grant pardons (Articles 30, 33 and 35).
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Instead of reducing the powers of the emperor, the revised constitution substantially enlarged and
reinforced his powers. Article 4 of the constitution, among others, made an explicit reference to
the absolute powers of the emperor: ‗…the person of the Emperor is sacred, His dignity is
inviolable and His power indisputable‘. Additionally, he had virtual powers and control over the
executive and administrative structures: ‗The Emperor has the right to select, appoint and dismiss
the Prime Minister and all other Ministers and Vice-Ministers‘ (article 66). Put simply, the
Council of Ministers, the organs of administrative apparatuses at central and provincial levels,
operated as extensions of the palace court. After 1943 the emperor appointed ministries till an
imperial order issued in 1966 granted the prime minister the power to nominate members of his
cabinet, though subject to palace approval (Markakis, 1974)
In fact, intermediating between the emperor and the parliament, the prime minister and the
council of ministers chiefly remained a clearinghouse for legislation. The close involvement of
the emperor with the executive functions of central government certainly made the executive
more important than the legislature and higher organs of the judiciary. Unlike as we know it
today, the prime minister‘s office then lacked a useful supervisory and executive power, with
little influence on the central government. In other words, the prime minister hardly provided
unified executive direction for the government, whether by enforcing general policy initiatives or
by commanding the obedience of other high officials, nor had he powers over such vital areas as
provincial administrations and the armed forces (Clapham, 1969; Markakis1974).
Furthermore, radiating from the central government in the capital, the emperor also gained more
control over local government. The administrative divisions had been revised and administrative
offices corresponding to them were established to reflect the modernization thrust and ambitions
of the emperor. The provinces (Teklay Gizat) constituted the biggest administrative units, with
each province divided into sub-provinces (Aawrajas), districts (Woredas) and sub-districts
(Mikitil Woredas). Local administrators in rural Ethiopia were primarily concerned with the
traditional functions of law enforcement, maintenance of law and order, and collection of taxes
(Lipsky, 1962). Although provincial administrations remained the preserve of the nobility and
traditional ruling elites, young educated men of unquestioned loyalty to the emperor were also
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assigned to help provincial governors and streamline administrative processes (Perham, 1969;
Meheret, 1997).
The foregoing discussion attested to the fact that both legally and politically the palace (the
monarchy) was the most powerful institution of policymaking and the center of all political
activities during Haileselassie’s era. The vital institutions of the palace court such as the Crown
Council, the Private Cabinet, the Minister of Pen, Aquabe Saat surpassed the formally
established institutions of policymaking and implementation such as the council of ministers, the
parliament and the provincial administrations. The emperor, as an apogee of both modern and
traditional political institutions, became the source of legislation, and no policy was issued
without his approval (Bahiru, 1991). As noted earlier, both constitutions had duly underlined that
the power of the palace can neither be disputed nor challenged. Furthermore, the predominant
legal, socio-cultural, historical and political milieu permitted no political associations of any
kind; thus, the political system hardly encountered demands for preferred policies, neither were
there any such significant societal pressures on the political system to put up proposals and
demands for policy changes till 1974.
In the wake of the 1960 aborted military coup, the last fourteen years of Haileselassie reign
witnessed growing opposition to his regime. In the aftermath of the coup, the Emperor sought to
re-claim the loyalty of coup sympathizers by introducing a few reforms, but they were far too
few. For the most part the measures, which took the form of land grants, primarily targeted
enriching the senior and middle-level military and police officers, but no coherent economic and
social development programs had been launched (Ottaway, 1978; Halliday and Molyneux,
1981). Haileselassie‘s government failure to carry out significant economic and political reforms
over the previous fourteen years, combined with rising inflation, widespread corruption and
maladministration, a famine that affected millions of farmers in the northern part of the country,
and the growing discontent of urban interest groups provided the backdrop against which the
Ethiopian revolution unfolded in 1974.
8.1.2 Public policy making during Dergue regime

Process, roles and institutions, 1974-1987
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The legislative process

For thirteen years since the downfall of Haileselassie‘s regime in 1974, there had not been any
written constitution in Ethiopia. Established as a collective head of government by a
proclamation, a body of junior and non-commissioned officers (NCOs) drawn from the armed
forces, police and territorial army held government power (PMAC, 1974). The group was
popularly known as the Dergue (the Amharic word for ‗committee‘ or ‗council‘). It deposed the
emperor, annulled the 1955 constitution, dissolved Hailesellasie‘s parliament and officially
declared the establishment of a Provisional Military Administrative Council (PMAC) in place of
the imperial government (PMAC, 1974:1-2). Afterwards, a plethora of proclamations were
promulgated in the name of the corporate group, namely, the Dergue or the PMAC.
After removing the imperial establishments, the Dergue did not offer guidelines to deal with the
policymaking process. The proclamation that the Military Government issued in September
1974 nonetheless suggested, at least indirectly, where the power of policymaking in Ethiopia
resided. It stated:
… Hailesalssie I is hereby deposed as of today, September 12, 1974. The Chamber of
Deputies and the Senate (Parliament) is hereby dissolved until the people elect through
democratic processes their genuine representatives dedicated to serve the interests of the
people... The Constitution of 1955 is hereby suspended. The Armed Forces, the Police
and Territorial Army Council has hereby assumed full government power until a legally
constituted people’s assembly approves a new constitution and a government is duly
established… (PMAC, 1974).
The proclamation was, however, vague about many contentious issues such as what the
legislative-executive relationships and the separations of functions in the policymaking process
would entail. Nor did it clearly stipulate the institutions with powers to initiate, adopt and
implement policies, which did not augur well for a democratic policymaking process. Issued in
the same year, the PMAC designated the organs of government that would be active in the
legislative process, and it, too, lacked clarity on a wide range of issues pertaining to
policymaking (PMAC, 1974).
Towards the end of December 1976 the Dergue introduced a hierarchy within itself. It involved a
congress (consisting of all of the Dergue members), a central committee comprising forty
members and designated by the congress, and a standing committee consisting of seventeen
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officers drawn from and elected by the congress (PMAC, 1976). A year later the Dergue
promulgated a piece of legislation that had a semblance of ‘a supreme law of the country’.
The legislation was enforced till the People’s Democratic Republic of Ethiopia (PDRE) was
officially inaugurated in September 1987 (PMAC, 1977). Not only did the legislation
substantively guide the policymaking process in the country, but it also widely regulated
relationships within various government agencies, on the one hand, and between government and
mass organizations, on the other.
The proclamation empowered the Dergue with both the legislative and executive mandates
(PMAC, 1977). Not only did the legislation institutionalize the hierarchy within the Dergue, but
also the virtual powers of legislation and execution resided in the Standing Committee. Hence,
almost all the powers of policymaking resided in the PMAC. The Congress consisted of all
surviving members of the Dergue, the Central Committee composed of thirty-two members
elected by the former and sixteen Standing Committee members elected by the Congress from
the members of the Central Committee (PMAC, 1977, EMI, 1981). Thereafter, its membership
never changed, although actual membership declined from 120 in 1974 to 80 in 1978 as
defections, death and assassinations took their toll (Pilany, 1978: 3). Chaired by the Head of the
State, who was also the Chairman of the PMAC, the Council of Ministers’ competences had
been limited to one of deliberating rather than incorporating critical inputs into the draft laws and
policies (Shiferaw, 1989; Andargachew, 1993). However, with the assignment of trusted
personnel from the military to each ministry and administrative regions, not only had
administrative fiat eclipsed responsibilities assigned to civilian ministers by law, but also parallel
decision-making characterized the policymaking institutions. In other words, government
agencies at each level of the policymaking structure had to account to the PMAC, the trusted
military officials posted in every ministry and the Council of Ministers, which came to be known
as multiple disunity of command.
What is more, the legislative process appeared to be limited to small circles of policymakers.
In fact, the bulk of policy decisions of vital importance as rural and urban land reforms,
nationalization of manufacturing industries, banks and insurance companies were made by the
Dergue. Andargachew noted:
All these radical reforms could be said to have originated from the demands of
the public and of the civilian activists. Once a policy was taken up by the Derg,
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however, it was up to the department heads to follow up their successful

completion. Each one of had one or more ministries and other public agencies
under their jurisdiction to assist them in this endeavor. Following the initiation of
a policy, a drafting committee was established in the relevant public agency over
which the concerned head of the Derg’s department presided.
Again, after the completion of the draft, it was up to the same department head to
submit and explain it to the Ad-hoc Supreme Organizing Committee. The latter
would then approve it with or without referring the matter to a general assembly
of the Derg. (1993, 169)
Lacking experience and expertise in legislation, the Dergue sought the assistance of civilian
ministers in the policymaking to complement its apparent weaknesses, although the latter had
marginal influence on agenda setting and the choice of policies. Nor had they exacted any
significant leverage to affect the directions of the implementation process (Teferra, 1997).
Hence, each ministry or government agency primarily proposed laws, pending their deliberation
and approval by the Dergue (Shiferaw, 1989). The Legal Department in the Office of the
Chairman of the Council of Ministers prepared the draft when, under certain conditions, the
Head of the State or the Council of Ministers had to initiate laws (Shiferaw, 1989:124). The draft
laws from these sources were to be sent to the Legal Committee in the Council of Ministers, with
the Department of Legal Affairs in the Prime Minister’s Office serving as secretariat of the
Committee. Chaired by the Minister of Law and Justice, the Legal Committee, whose members
included the Minister of Education, the Minister of Foreign Affairs, the Deputy Minister of
Finance, the Deputy Minister of Mines and Energy, a representative from the National Planning
Supreme Council, the
Department Head of Legal Affairs in the Office of the Chairman of the Council of Ministers, and
the Minister or Head of the Agency sponsoring the draft legislation would deliberate the sprit of
the legislation, and send that to the PMAC via the CoM for approval (ibid). Shiferaw (ibid.: 125),
however, noted that there were exceptions to the established procedures, as when draft laws were
assigned to a group of experts specially established to examine bills to be able to provide their
expert opinion and recommendation. In some other cases, legislation was referred to a joint
Legal and Administrative Committee or to a joint Legal and Economic Committee, all of which
were established by the Office of the Council of Ministers (ibid.). After having studied and
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incorporated their wisdom, the draft legislation would be sent to the Provisional Administrative
Council for final approval. The proclamations were published on the official Negarit Gazeta
bearing the name of the corporate body, Provisional Military Administrative Council (the
Dergue). Albeit the same personalities remained in the leadership positions, the virtual power of
decision making over the years shifted from the Dergue (PMAC) to COPWE/WPE.
The official ideology, the party and policymaking

In a desperate search to find a guiding philosophy, the ideological values, which PMAC
(Dergue) espoused, had metamorphosed since its coming to power in 1974. It started with
‗Ethiopia Tikdem‘ (Ethiopia First) and/or Hibrettesebawinet (Ethiopian Socialism), which had
for most part been kindled with the rhetoric of justice, equality, freedom, nationalism, national
sovereignty and the primacy of the economic benefit of the common people. The first such
attempt appeared in the official government policy document. The politico-administrative, social
and economic policies that underpinned the philosophy had further been emphasized (op. cit).
Dergue pledged to invest resources and exert efforts to promote collective decision making from
village to higher-level government institutions. It also pledged for an establishment of a single
political party under which every facet of social life had to be mobilized and to which every
segment of Ethiopian society had to pay its allegiance (ibid: 8). Hence, not only was this single
political party enjoined to ensure ‗popular participation‘, but it would also be instrumental for the
dissemination of the political philosophy as well as state control (ibid, 8). Ottaway and Ottaway
(1978: 63), nevertheless, argued that Ethiopia Tikdem meant in effect a rejection of a pluralist
parliamentary system in which various societal groups were represented in a struggle to
determine national policy. In other words, only the military government and the higher echelons
of its administrative structures could interpret the common good and steer Ethiopia in the ‗right
direction‘.
The guidelines certainly indicated that the Dergue placed it self in an analogous position to a
vanguard party among the plethora of government institutions, with the public bureaucracy
enforcing its policies (Schwab, 1985). In addition, the political philosophy that set policy
guidelines redefined Ethiopia’s economy, calling for the state control of major industrial
establishments, with a limited participation of the private sector in the economy. It also called for
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government ownership of land (which was the center piece of Ethiopia Tikdem),
communications, manufacturing industries, electricity, and mining of precious metals, tourism,
and large-scale construction. In effect, the new economic policy provided value premises upon
which a socialist Ethiopia would be constructed.
The Dergue further outlined its economic program as follows:
The principle that the common good takes precedence over the pursuit of individual gain is the
starting point of both economic and social policies. In the domain of economic policy, giving
priority to the interests of the majority means curing its basic economic diseases. The basic
economic disease of the majority is at present poverty. The primary element of economic policy
is consequently the abolition of poverty. In addition, the prevention of economic exploitation
will also be an element of this policy. This requires the public ownership of the nation’s
economic resources.
 Accordingly those resources that are either crucial for economic development or are of
such a character that they provide an indispensable service to the community will have to
be brought under government control or ownership…
 The natural resources of the country will be a special instrument of this policy.
Agriculture is at present the mainstay of the national economy. Land tenure and
agricultural policy will consequently be changed in a manner which will make it possible
to abolish poverty and narrow the gap in the level of living. As land belongs to the entire
community, the government is the trustee of this important national resource.
 Land exclusively under public ownership and management will be designated
periodically. Government will give guidelines for land which is owned communally.
Similarly, private holdings which will fall under cooperative associations will also
operate under guidelines provided by the Government. Individuals and communities
which have the legal right to operate communal, cooperative, or private farms will be
accountable to the Government for the good care and management of their holdings. The
forthcoming law on land reform will in particular cover this point. Those who operate
communal and cooperative farms will be given special government support and
assistance. (PMAC, 1974: 10)
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These represented the overriding parameters and beliefs that had guided the commitment of the
emerging policy elites till they adopted National Democratic Revolution Program (NDRP) in
April 1976. This period had also witnessed the rapid growth of a cohesive administrative
framework in which all social, political and economic policies that were to be pursued would be
incorporated within that socialist construct (Schwab, 1985). In other words, not only did
December 1974 represent the genesis of the institutionalization of policymaking structures under
the leadership of the Dergue, but it was also a turning point in Ethiopian history for it witnessed
the official introduction of socialism.
The ideological metamorphosis that had its inception even before the Dergue took power
culminated in the National Democratic Revolution Program (NDRP) that made its entrance into
the official government policy documents and pronouncements after April 1976. Predicated on
the teachings of Marx and Lenin, the NDRP was a radical recourse for ideological commitment
towards scientific socialism. The Program set out the following objectives:
1. To completely abolish feudalism, imperialism and bureaucratic-capitalism from Ethiopia and
with united effort of all anti-feudal and anti-imperialist forces build a new Ethiopia and lay a
strong foundation for the transition to socialism.
2. Towards this end, under the leadership of the working class and on the basis of the worker-
peasant alliance and in collaboration with the petty bourgeoisie and other anti-feudal and anti-
imperialist forces, establish a peoples’ democratic republic in which the freedom, equality,
unity and prosperity of Ethiopian peoples is ensured, in which self-government at different levels
is exercised and which allows for the unconditional exercise of human and democratic rights.
(PMAC, 1976)
These pronouncements coincided with the establishment of the Provisional Office for Mass
Organizational Affairs (POMOA). The responsibility of translating the teachings of Marx and
Lenin into different ethnic languages, disseminating the same among the Ethiopian public and
laying the groundwork for the establishment of a workers’ party as well as a Soviet-style
people‘s republic was assigned to the latter by legislation (PMAC, 1976). Despite it took several
years of acrimonious conflict and bickering within the Dergue and between it and civilian
activists, the objectives stipulated in the Program had an enormous impact on the modus
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operandi of policymaking and organization of policymaking institutions. From this time forth,
the teachings of Marx and Lenin set the parameters of rallying the peasantry and the urban poor
behind the government and its policies and practices. Nationalization of the means of production
and the reorganization of the economy in terms of a central planning and command structure;
and the promotion of anti-West and pro-East foreign policies were entirely predicated on the
ideology.
Not only did the ideology set the parameters and modus operandi of public policymaking, but it
also provided the party and the executive leadership with the powers to set priorities for agenda
setting and policy choices to be made. Put simply, policy elites adopted Marxism-Leninism,
whose conceptual tools guided the policy goals to be pursued and the institutional instruments to
be constructed in formulating and implementing public policies.
When the Commission for Organizing the Working People of Ethiopia (COPWE) was
established in 1979, not only did the Dergue make the official claim that building socialism and
communism in Ethiopia would only be possible under the leadership of a Leninist party, but it
also claimed that the single most important actor in the socio-economic policymaking process
was the party of the working people (PMAC, 1980: 60). With COPWE as a leading political
entity, the importance of disseminating Marxist-Leninist doctrine among government and mass
organizations, cooperatives and the public had boldly been underscored (op. cit.). Policy elites
further pledged to organize a single party of the working people and instituting a new people’s
democratic republic essentially guided by and based on the ideology of Marxism-Leninism.
Hence, the clamor for embracing Marxism-Leninism stems from the fact that it served as a tool
for the socio-economic transformation of the country. It was also seen as the only reliable
conceptual tool and guiding principle for formulating the ‘correct’ socio-economic strategies
and policies and determining the lines of the country’s socio-economic and political
development (op.cit.).
In just a few months after its establishment, COPWE’s structure spanned almost all the regions,
provinces, districts and work places in the towns and rural villages. It increasingly came to
symbolize the cutting edge of all socio-economic and political initiatives and national policy
decisions, although the core group of Dergue members as yet remained the top echelon of the
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COPWE leadership. The Second Plenary Session of the Central Committee of COPWE, for
instance, conducted a four-day deliberation on the vital national social and economic policy
issues, and issued an 11-point resolutions mainly targeting the re-organization of the Ethiopian
trade unions, urban dwellers’ and peasant associations, youth, women’s and professional
associations along party lines (COPWE, 1981). COPWE’s leadership issued a set of guidelines
for restructuring and implementing administrative institutions that had vital importance, such as
the Ministry of Urban Development and Housing, National Revolutionary Development
Campaign and Central Planning Supreme Council (NRDC-CPSC) and other implementing
agencies dealing with natural resources, tourism, agriculture and commerce (ibid.). Having been
the hallmark of socialist socio-economic transformation, the establishment of NRDC-CPSC in
Ethiopia marked the ascendance of a command economy and central planning based on
socialism. By a proclamation promulgated in September 1984, COPWE was renamed as the
Worker‘s Party of Ethiopia (WPE). Since then, the latter issued guidelines and decrees to guide
and monitor state-society relationships. Although much of the statutory pronouncements were
often made in the name of the Dergue, since the end of the 1970s, nevertheless, COPWE and
after mid1980s WPE assumed virtual control over the entire socio-economic policymaking
process. With the coming into being of the WPE, not only had policymaking by far been
centralized and institutionalized, but so also did the teachings of Marx, Lenin and the program of
WPE dictate the policymaking process. The overriding strategic objective of the party was
claimed to be building socialism, and via socialism achieve socio-economic and political
transformation and move towards a classless society, namely, communism (WPE, 1984). The
party professed that any socio-economic development and transformation in Ethiopia would be
unthinkable in the absence of the leading role of the WPE and the principles of Marxism-
Leninism from which it got its inspiration.
Much like its successors, WPE laid emphasis on the primacy of agriculture both in the short and
medium terms, and transformed the economy from a predominantly agriculturally based to an
industrially based economy. WPE’s central strategy in agriculture, therefore, was targeted at
the transformation of miniscule and isolated farming units into modern large-scale farming
whereby more advanced organization of agricultural production could be utilized (ibid.). The
corollaries of WPE’s agricultural strategies, at least in the medium term, included expanding
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big state-owned farms, and transforming small peasant holdings into large-scale producer
cooperatives that would in turn facilitate improved organization, use of better and more advanced
technology, better production services (op. cit.). Another important corollary of the rural
transformation program was the relocation and reorganization of the peasantry from peasant
associations based on scattered homesteads to producers’ cooperatives organized on the basis
of rural resettlement and villagization programs, which had rigorously been pursued before and
after the establishment of WPE (Harbeson, 1988). Additionally, WPE exerted an effort to create
an efficient system of socialist economic management based on the principles of democratic
centralism and strong central and regional planning.
In the political and administrative spheres, based on a worker-peasant alliance and progressive
revolutionary elements, WPE pledged the establishment of a people’s democratic republic of
Ethiopia. ‘WPE is at the forefront of the new socio-political order whose ultimate objective is
the establishment of proletarian dictatorship and under the leadership of WPE. The Party’s
commitments to its historic mission of establishing the dictatorship of the proletariat and laying
the socio-political basis of socialism can come true only if it can assert its supremacy in the
political leadership’ (WPE, 1984: 39-40). Moreover, not only did the party claim that it was at
the cutting age of the entire political process, but also professed that no socio-economic
development programs would be accomplished without its leadership. Suffice it to say that
Marxism-Leninism profoundly influenced development goals, with the establishments of the day
centrally guiding policy implementation. As earlier noted, the real policymaking power in WPE,
however, resided in the Politburo, which had eleven full and six alternate members. Dawit
(1990), an insider and a former member of the Central Committee of WPE, nevertheless noted
that, although WPE’s Politburo had ostensibly been the country’s most important
policymaking body, the latter was a little more than the articulation of ideas already decided on
personally by Mengistu. In other words, most policies of vital importance, including major socio-
economic decisions, that Mengistu proposed had little difficulty finding their way onto the
agenda, and, therefore, he could make decisions that had far-reaching consequences without
consulting the executive ministries.
607
The making of the 1987 constitution and its implications, 1987-1991

The making of the constitution
WPE‘s program set the preconditions for the making of the constitution in 1984. It spelt out the
following points.
1. A new political order called for an establishment of the Peoples’ Democratic Republic of
Ethiopia under the leadership of WPE. The major task ahead of the leadership of WPE and the
government of PDRE would be to undertake a non-capitalist path of socio-economic
development, build socialism and communism. The achievement of these objectives would again
call for restructuring of government institutions based on a worker-peasant alliance, which would
gradually evolve into the dictatorship of the proletariat.
2. The institutional structure of the PDRE would be based on the universal tenets of Marxism-
Leninism and the principles of socialism. Hence, the republic would be supported by democratic
centralism, socialist legality and proletarian internationalism. In general, the modus operandi of
the PDRE as well as the fundamental rights of citizens would be enshrined in the constitution
and other laws.
3. WPE would ensure that the National Shengo operates as the supreme organ of state power in
the PDRE, and the supremacy of the working people would be affirmed in the republic.
Moreover, the structures of PDRE would be unitary and take into account the settlement factors
and economic conditions of ethnic groups or nationalities. In the republic the organization of
government power from the lowest regions to the national government organs would be
predicated on popular elections.
4. In view of the proper discharge of duties at different levels in the hierarchy of the republic,
government officials would come under close government and public scrutiny as well as control
(WPE, 1984: 41-43)
Although there had been a flurry of activities (among the public, the ruling party and government
circles) during the process of the making of the constitution, the above guidelines continued to
reign all along. In fact, the directives appeared in the different parts of the constitution that
contained 119 articles and 17 chapters in 1987. In his opening remarks to the first plenary
608
session of the Constitutional Commission, Mengistu reiterated the guidelines that underpinned
the constitution making process:
….the People’s Democratic Republic of Ethiopia (PDRE) will be organized and run on
the basis of the well-known principles of Democratic Centralism, Proletarian
Internationalism and socialist legality. It will also be founded for the purpose of the
realization of the programs and policies of the WPE. It will accordingly make a vital
contribution to finalize our struggle, which is aimed at accomplishing the National
Democratic Revolution through mobilization of the working people, and lay the
necessary material and technical foundation for the attainment of socialism.
As you well know, intensive and extensive research has been conducted at the Institute
for the Study of Nationalities to act as a springboard for the preparation of the
constitution. Considerable work has been carried out in this regard primarily with the
close attention of COPWE and the Revolutionary Government and later under the
guidance of our party (WPE). Useful preliminary ideas have been advanced by
examining conditions in light of the characteristics of the revolution and its long-term
objectives in order to qualitatively formulate the constitution of the New Ethiopia.
Accordingly, the constitution drafting commission is not beginning its work in a vacuum
but on the basis of the concrete studies and research on which much labor has been
invested. (Herald, 25 February 1986)
The primary task facing the WPE following its formation in 1984 was thus to develop a new
national constitution that would lead to the inauguration of the People's Democratic Republic of
Ethiopia (PDRE). A Constitutional Commission consisting of 343 members was formed, by a
proclamation, to draft a new constitution in March 1986 (PMAC, 1986:3-8). Eventually, the 122
full and alternate members of the WPE Central Committee who had been appointed to its
membership dominated the commission (Teferra, 1997). The Constitutional Commission had its
origins in the Institute for the Study of Ethiopian Nationalities, which the Dergue established in
March 1983 to seek solutions to problems resulting from Ethiopia's ethnic diversity, to conduct
research, and undertake studies leading to the drafting of the constitution as well as the
restructuring of national and regional organs.
The implications of the constitution for policymaking
609
The preamble of the PDRE’s constitution traced Ethiopia’s origins back to olden days,
praised
the historical heroism of its people, eulogized the country's unexploited, natural and human
wealth, and pledged to continue the struggle against imperialism and poverty (PDRE, 1987:55).
The government claimed that its primary concern was the country's development through the
implementation of the National Democratic Revolution Program (NDRP), with the primary
emphasis placed on setting the material and technical bases necessary for the implementation of
socialism (ibid.).
It further situated Ethiopia in the context of the movement of proletarian internationalism and
progressive states. Critics claimed that the constitution was no more than an abridged version of
the 1977 Soviet constitution, although strong powers were assigned to the office of the president
(Clapham, 1988; Andargachew, 1993; Teferra, 1987). A second difference between the
Ethiopian and Soviet constitutions was that the former declared the country a unitary state rather
than a union of republics. The 1987 constitution also pledged to seek solutions to simmering
problems of ethnicity within the framework of a single multiethnic state rather than a federation
(PDRE, 1987).
The ultimate policymaking power appeared to have resided in the president of the republic and
the Council of the State (which largely comprised the highest echelon of Dergue members). The
articles that follow the preamble largely addressed the political and socio-economic system that
the country had to be built to be a member of the family of socialist nations (PDRE, 1987: 55-
61).With the republic’s commitment to the building of socialism via the accomplishment of
national democratic revolution, Ethiopia was seen as a state of the working people established on
the basis of a worker-peasant alliance (1987: 55-56). The equality of nationalities and languages
within the framework of a unitary state were also assured. Guided by Marxism-Leninism, the
Workers’ Party of Ethiopia (WPE) was the sole vanguard political organization with a supreme
commitment to determine socio-economic policies of the country as well as with the powers to
lead the state and the entire society (article 6). Not only did socialist legality take center stage in
the governance of the relationships between the different state organs in the hierarchy of state, on
the one hand, and mass organizations, officials and individuals in the society, on the other, but it
was also the key political parameter in the selection of the participants and actors in the country‘s
610
socio-economic policymaking process (articles 5 and 6). Furthermore, the organization of the
organs of the state were based on democratic centralism, with the lower organs accounting to the
next higher organs for their actions and abiding by the decisions of the higher organs (article 4).
In the economic sphere the state would relieve the country of economic backwardness by
strengthening the socialist relations of production and building ‘a highly integrated national
economy based on central planning (article 9). While allowing for a limited form of private
ownership within limits set by laws, it reaffirmed the pre-eminence of socialist ownership of the
means of production, distribution and exchange (articles 9 and 12). In the field of culture, the
constitution pledged to imbue the working people with socialist morality and the proletarian
culture (article 23).
Having provided for equality before the law regardless of ethnicity, sex, religion, occupation,
social and cultural status, the provisions dealing with citizenship, freedoms, rights and duties
tended to be egalitarian. Citizens were granted the right to work, to receive free education, to
have access to health care, to conduct research and engage in creative activities in science and
technology. Unlike in an imperial state, the state and religion were separate. Citizens were also
guaranteed the freedom of conscience, religion, of speech, press, peaceable assembly,
demonstration and association, although in reality citizens enjoyed very little in this regard
(articles 35, 40, 41, 42, 46 and 47).
The bulk of chapters eight to fifteen of the constitution described the modus operandi of
policymaking during the first republic and detailed the hierarchical and horizontal
relationships between organs within the republic (PDRE, 1987: 73-92). PDRE was essentially a
unitary state comprising of administrative and autonomous regions, with the administrative
regions and units of administration hierarchically organized from the highest to the lowest levels
(articles 59 and 60). Elected for a five-year term and holding sessions annually, the supreme
organ of the Republic was the National Shengo (national parliament) with extensive legislative
powers (articles 63, 67 and 68). They were, among others, enacting, amending and
following up the observance of the constitution and proclamations, issuing domestic,
611
foreign, defense and security policies; determining the state of peace and war; determining
monetary and fiscal policies (ibid).
As provided under the constitution, the National Shengo was empowered to institute the vital
organs of the state such as Council of the State, the Council of Ministers, ministries, state
committees, commissions and other government agencies, the Supreme Court, the Office of the
Procurator General, the National Workers’ Control Committee and the Office of the Auditor
General. Electing the President of the Republic, the Vice-President, the Vice-Presidents of the
Council of the State, approving the appointment of other high government officials had also been
vested in the National Shengo (article 63). It is worth noting here that the Council of State, the
President of the Republic, Commissions of the National Shengo, members of the National
Shengo, the Council of Ministers, the Supreme Court, the Procurator General, Shengos of higher
administrative and autonomous regions, and mass organizations through their national organs
were designated to propose laws and policies, although in practice the upper reach of the party
and executive leadership had exclusive claim on public policymaking (article 71). Having been
assigned to follow up the implementation and interpretation of the constitution, the Council of
the State represented the standing body of the National Shengo. Its powers included, among
others, revoking the directives and decisions of regional government organs that had to account
to the National Shengo, ratifying and revoking international treaties, granting amnesty, granting
citizenship and political asylum (articles 81 and 82). Announcing the date of the election of the
Shengo, calling its extra-ordinary sessions as well as coordinating the work of its ad-hoc and
standing committees, overseeing the discharge of responsibilities by the Council of Ministers, the
Supreme Court, the Procurator General, the National Workers’ Control Committee had as well
been entrusted to the Council of the State. Moreover, the latter had the power to issue decrees in
the pursuit of responsibilities assigned by the Shengo. Comprised of the president of PDRE, the
vice presidents, a secretary and high officials of the National Shengo, not only was the Council
of the State empowered to issue special decrees between the recesses of the Shengo, but also was
it empowered to declare states of emergency, war, martial law, mobilization or issue peace
decrees (PDRE, 1987: 79).
612
Although the Council of Ministers was formally the highest executive organ, sweeping executive
powers were vested in the President, a position which was held by Mengistu (PDRE, 1987: 81-
84). The President of the PDRE was, therefore, the Head of the State, who represented the
Republic both at home and abroad, and the Commander-in-Chief of the Armed Forces (article
85). The constitution also vested additional executive powers in the President, ranging from
presiding over the sessions of the National Shengo and Council of Ministers to appointing
personnel to ministerial and executive leadership, and conferring high military and civilian
appointments (ibid). He enjoyed legislative powers such as: issuing Presidential decrees in the
pursuit of powers provided by the 1987 constitution, promulgating laws approved by the Shengo,
the Council of the State and the President of the PDRE (PDRE, 1987: 83). Equally, the President
enjoyed the privileges of appointing or dismissing the prime minister, deputy prime minister, and
members of the Council of Ministers, the president and vice-presidents of the Supreme Court, the
Procurator General, the chairman of the National Workers’ Control Committee, and the
Auditor General and the Judges of the Supreme Court (article 87). Consisting of the Prime
Minister, Deputy Prime Ministers, Ministers and other members as defined by law, the Council
of Ministers was the highest executive as well as administrative organ of the Republic (article
89). Comprised of the Prime Minister, Deputy Prime Ministers and other government officials,
the Council of Ministers was chiefly empowered to execute policies (articles 91 and 92).
The constitution and other statutory provisions, nevertheless, appeared not to have clearly shown
the overwhelming powers of the combined forces of the executive and party leadership in public
policymaking during the first republic (i.e. from 1987 to 1991). The powers of legislation and
policy initiation had been vested in the National Shengo, as provided under the 1987 constitution.
In practice, nevertheless, policymaking power resided in the higher echelons of the organs of the
Republic and WPE precisely because of the requirement of the principle on which policymaking
institutions were premised, namely, ‘democratic centralism’. In fact, by default or design, not
only had the party and the executive claimed the prerogatives of designating and fielding
candidates to the Shengo, but they were also the architects and key players to lead the state and
society. Apparently, the party (WPE) represented a sustained effort to create a political
leadership with a structure though which policy decisions were to be communicated and
implemented (Clapham, 1988). Despite the official claim put the members of the Dergue‘s
613
parliament drawn from the peasantry and urban poor to 48 percent, in reality, however, over 95
percent of the Shengo members who had been classified as workers, farmers, state and party
functionaries were the members of the party.
In addition, the fact that the Dergue‘s parliament could only hold sessions once in a year
rendered difficult the exercise of legislative duties, oversight and subpoena over the executive as
stipulated in the constitution. In other words, while the National Shengo was during the long
recess, the Council of the State which drew its members largely from the ‘top-notch’
members of the Dergue chaired by Mengistu, made all the policy decisions.
Additionally, while the Council of Ministers, various government bodies and the national
leadership of mass organizations received official recognition in proposing policies, in reality,
however, enormous powers remained with the executive, the President and the party leadership
(Dawit, 1990). In sum, by default or by design, the Presidency, the Council of the State and the
inner circles of the WPE leadership remained the repositories of policymaking powers till 1991.
Implementation through centrally guided institutions, 1974-1987
The prelude
The bulk of the implementing agencies and government institutions had been introduced since
1974, notwithstanding the fact that a few agencies were inherited from the imperial government.
Most of these structures appeared to be volatile, due in part to the uncertainty characterizing a
revolution, partly because clear guidelines to govern the relationships between the Dergue, the
Council of Ministers, ministries, various other government agencies and the fourteen provincial
administrations were almost non-existent Hence, in the first few years of the revolution; the
Dergue had to rely on transient government bodies to execute most of its reforms.
The Dergue depended on, among others, its sub-committees to a considerable degree to preside
over and parallel the civilian ministries. Additionally, despite that fact that they had not held
official government positions, the PMAC assigned a few of its key individual members such as
liaison to such ministries as transport and communication, housing and urban development,
agriculture and settlement and various other ministries and quasi-governmental agencies.
614
In a bid to acquire loyal personnel, the PMAC selected over 250 persons from the army and
assigned them to government ministries and nationalized commercial and industrial enterprises
in the capital city and the fourteen administrative regions as permanent secretaries, department
heads and managers (Pliny 1978; Teferra, 1997). The powers and responsibilities of the vigilante
groups, who came to be known as the ‘missionaries of change’ (Yelewout Hawariat), vis-à-
vis professional appointees and experts had not been properly defined. Ranking civilian officials
usually complied with the orders of the military supervisors, while informally indicating their
lack of respect for inexperienced military judgments regarding the professional and technical
problems confronting the government agencies (Cohen and Koehn 1980, 296). Although the
‗missionaries of change’ (Yelewout Hawariat) were ostensibly seen as roving cadres upon
whom the Dergue relied for the implementation of socio-economic reforms, their appointment to
various government institutions nevertheless generated perpetual inefficiency and
mismanagement in the public bureaucracy, and despondency and mistrust among employees.
Furthermore, having had the objectives of explaining socio-economic policies to the regional
administrators, the public and the military units, Dergue members took regular tours throughout
Ethiopia. In mid-1978, the regular tours through the provinces were replaced by postings of
PMAC members as permanent representatives to the regions. Toward the end of 1977 PMAC
posted twelve of its members to the provinces to oversee the implementation of socio-economic
and political policies. Not only the representatives enjoyed enormous powers and seized ultimate
authority in overseeing implementation outcomes, but they also capitalized on their direct
contact with the Standing Committee of the Dergue leadership to override the decisions of
regional and local administrations (ibid.).
However, as the socio-economic transformations and institutional restructuring deepened, and in

view of the recourse to Soviet-style government structures, the transitory structures proved
inadequate. As a result, the wave of proclamations that the PMAC issued in the mid-70s called
for fundamental institutional transformations at the center, and down the line at the regional and
local levels. In other words, the post-revolution government had moved forward to strengthen
central planning and policy implementation through modifications on the Soviet models and
reliance on central level bureaucratic technicians.
Molding implementing institutions from top
615
The Council of Ministers, which the Dergue established in the first few years of its coming into
power, consisted of civilian ministers and other high-level government officials appointed by the
chairman of the Dergue (PMAC, 1977, EMI, 1981). Although the legislation assigned the CoM
wide-ranging responsibilities, in reality it remained a clearing-house of legislation and channel of
communication between the military elites and a network of administrative institutions. In mid-
1981, twenty-one ministries, several commissions, authorities and other government agencies
were organized under PMAC/COPWE (EMI, 1981). Following the COPWE/WPE establishment,
not only had party establishments overlapped with the bureaucratic structures, but also ministries
and other implementing agencies had to account to the party and its leadership for all of their
actions. In other words, chiefly because of the ascendance of the party and central planning, the
powers of the government bureaucracy had been severely curtailed. Emerging victorious over the
Somali invading force and civilian opposition, the Dergue’s leverage in reorganizing centrally
controlled implementing structures had substantially been enhanced.
616
Figure 3.1. Policy Implementation through State and Party-Led Structures: 1974-1987
PARALLEL STRUCTURES
617
Central and regional policymaking structures of the PDRE

The institutional mechanisms that had over the previous eight years evolved were also used for
much of the duration of the first Republic, except that new names appeared to reflect the 1987
constitution of the PDRE. Officially, however, the People’s Democratic Republic of Ethiopia
(PDRE) replaced the Provisional Military Administrative Council (PMAC). The first congress of
the National Shengo adopted legislation introducing new state organs including itself, the
Council of the State, the President, the Procuracy, the Judiciary and the Council of Ministers, as
noted earlier (PDRE, 1987). Designated as the highest executive and administrative organ of
government, the latter became responsible for the implementation of policies that the Shengo, the
standing legislative organ of the Republic (the Council of the State) and the President
formulated.
The second important institutional mechanism that the Institute for the Studies of Nationalities
contributed to PDRE was the reorganization of Administrative Regions into five autonomous
regions and twenty-five administrative regions. The reorganization of administrative regions was
primarily motivated by the desire to streamline the implementation of policies and legislation
made along the then prevailing party thinking.
By 1989 the Council of Ministers became a massive structure spanning the national and regional
implementing agencies, with a prime minister, five deputy prime ministers, twenty ministries,
two state committees, seven commissions, six authorities, two institutes and a central bank under
its jurisdiction. In essentially administrative respects, the newly carved-out five autonomous and
twenty-five administrative regions came under ‘the highest executive and administrative organ
’ of the Republic. Much the same as in the Soviet-style republics, the Prime Minister had five
Deputy Prime Ministers working under him, with each Deputy Prime Minister heading a division
Assisted by a secretariat and a group of advisors, the Prime Minster was the head of the
government with wide-ranging powers, although Mengistu appeared to have eclipsed almost all
of the competences of the executive assigned to the CoM as provided under the 1987
constitution. Furthermore, down the line central government establishments had been replicated
at different levels in the hierarchy of administrative structures, with a three-tier structure
consisting of autonomous and administrative regions (at regional level), provinces (Awerajas),
618
and neighborhood (Kebele) at a local level. The district (Woreda) that appeared the lowest unit in
the hierarchy of the administrative structure in the imperial period, and a very basic institution of
the administrative apparatus till 1987, was integrated into the provincial structure (Awerajas)
after the constitution came into force. However, not only does the Kebele (neighborhood)
establishment remain the basic unit of administration to this day, but was also was as much at the
center of immense socio-economic and political activities during the Dergue era as it is today.
Endowed with limited executive powers, the implementing agencies operating below national
levels had solely been required to ensure and/or follow up the implementation of policies of the
higher state and party organs (FDRE, 1987). Not only had regional and local assemblies very
limited legislative powers, but central government institutions such as the CoM could also
override their decisions. Nor could administrative organs of the local government implement the
decisions of their respective assemblies without the approval of the central government
institutions (op. cit.). In other words, regional and local government institutions had neither the
powers to formulae policies in a very rudimentary and local sense, nor did they have the leverage
to use the local initiative to execute policies as local circumstances permit.
By 1989, amidst civil war and a malfunctioning economy, regional Shengos (regional
assemblies) had been elected in only eleven of the twenty-five newly designated administrative
regions and three of the five regions designated as autonomous (Hailu, 2003). Excluding Eritrea
and Tigray, where the insurgents grew stronger, the government introduced the structures of the
new Republic in Dire Dawa, Assab and Ogaden. Eleven of the 25 administrative regions singled
out for introducing the PDRE structure included North Wello, South Wello, Metekel, Asosa,
Bale, Gambella, West Hararege, East Hararege, South Omo, North Omo and Wollega (op. cit.).
In retrospect, WPE dominated the entire election process, and party members filled the positions
in Shengos and their respective executive committees (op. cit.). Eventually, the newly emerging
autonomous and administrative regions came under the centralized and strong arm of the party
and the national executive structure. The all too familiar, ‘the hegemony of WPE, democratic
centralism, socialist legality, the primacy of central planning and proletarian internationalism’,
guided the choices of public policies and the modus operandi of policymaking.
619
8.1.3 Public policymaking under the EPRDF, 1991-2004

The major actors during the transition, 1991-1995
In the wake of the fall of the Dergue, the Transitional Government of Ethiopia (TGE)
promulgated scores of policy and legislative enactments. A total of one hundred thirtythree (133)
proclamations providing for regional restructuring and regional elections, the powers and duties
of central and regional government agencies, annual and emergency budget legislation,
terminating the institutions of the defunct regime and ratification of multilateral and bilateral
relations with foreign governments had been promulgated during the transition period (the
Minutes of CoR: 1991-1995). The CoR held 114 sessions, 109 plenary and 5 ad-hoc sessions,
with each session extending to two or more meetings. Held in April 1994 for a series of twelve
days to deliberate on the draft constitution, the 94th Plenary Session marked the highest such
extended meeting. Although the minutes of every session were regularly recorded, it was not
until several months later that they were subject to approval, to such an extent that redressing the
soundness of the records proved beyond reproach. Attendance of all the sessions was properly
recorded and incorporated into the minutes, albeit the volatile nature of the TGE coalition
rendered continuous membership unlikely.
The CoR began its sessions in July with 80 active members, save Addis Ababa University’s
representation, whose seat remained vacant till in fact its representation was annulled in January
1992 (the 36th Plenary Session, March 1994). In September 1991 CoR decided to distribute six
seats to ‘hitherto neglected’ nationalities and thereby expand the number of active CoR
members to 86. However, amidst acrimonious conflict and armed pressure, the major partner in
the TGE coalition, namely the Oromo Liberation Front (OLF), withdrew from government in
June 1992. The expulsion of five-coalition partner political organizations from south Ethiopia in
February 1993, apparently for their part in the Paris peace conference, reduced the active number
of CoR member organizations and individual members to 22 and 66 respectively.
Taking 1991 as a benchmark, making judgments about the stature of CoR’s non-EPRDF
political organizations and their role vis-à-vis policymaking could to some degree be
complicated. After the withdrawal of the OLF and the expulsion of South Ethiopia’s coalition
partners, EPRDF achieved close to fifty percent majority over the remaining divided and
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fractious non-EPRDF members of the CoR. It was thus selfevident that EPRDF had increasingly
ascertained overwhelming leverage to push any agenda and policy decisions through the Council
of Representatives after the latter half of 1993. Nonetheless, this should not give one the
impression that EPRDF was not well positioned to put its agenda through before mid-1993.
Certainly it was, but the withdrawal and expulsion of 20 non-EPRDF members of the CoR (in an
87-seat legislature) absolutely guaranteed EPRDF a monopoly on policy agenda setting, and
emboldened its control over the voting system in the CoR and the entire policymaking arena
during the transition in Ethiopia.
Additionally, the legislative enactments that EPRDF had the CoR endorse bolstered its role in
the legislative process. The President of the TGE had in fact been empowered to preside over the
CoR to ensure the implementation of policies, to confer positions on high civil and military
officials, to appoint the Prime Minister and the members of the cabinet, and to call the sessions
of the CoM at his leisure (TGE, 1991). Having had the highest executive and administrative
eminence during the transition, the competences of the latter inter alia included ensuring the
implementation of socio-economic policies, controlling and supervising the activities of the
country’s bureaucracy, preparing the national budget, initiating legislation to be approved by
the CoR (TGE, August 1991). Except for three positions and one deputy ministerial appointment
that went to the OLF and a member of the South Ethiopia coalition partner respectively, the rest
of the cabinet positions with and without portfolios had been assigned to the EPRDF and its
close allies (Kinfe, 1994).
Answerable to the President and the Council of Representatives, the Prime Minister was the head
of the CoM and the entire civil service that provided the EPRDF with the leverage to see whether
government agencies and civil servants observed policies and legislation. In other words, which
individual and institutional players in the TGE commanded a legally mandated (or otherwise)
influence on the policymaking process depended a lot on which group had ample access to the
conduits of the massive powers of the state and its resources.
Hence, despite the fact that the CoR’s vice-chairmanship and the secretary had been assigned
to non-EPRDF members of the CoR, whose organizations held not more than two seats each and
who also had neither the power nor the leverage to influence agenda setting and policymaking,
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the two vital positions, the Presidency and Prime Minister, with enormous powers and leverage,
went to the leaders of EPRDF. Furthermore, apart from having a strong military power that
installed it at the top of the policymaking pyramid, EPRDF allocated itself a controlling number
of seats that earned it and its allies (friendly organizations, so to speak) a comfortable majority to
have the TGE legislature endorse its legislative proposals. So, till the end of June 1992 the
EPRDF had 32 seats (37.2%), and its control over the agenda and voting system with the same
seats steadily grew to 42% after the withdrawal of 12 members of the OLF; the proportion was
scaled up even further to 48.5%, following the expulsion 8 members from the south Ethiopia
Coalition partners. This attests to the fact that the EPRDF was in firm control of the carrot and
the stick, so much so that the few friendly organizations which remained to its side were
rewarded with power and amenities (i.e. the carrot), but had little effect in influencing policies.
In contrast, the many others that resisted EPRDF‘s positions, terms and conditions were either
outmaneuvered to withdraw or face their outright expulsion (i.e. the stick).
As is evident from the foregoing discussion, through the majority seats in the TGE legislature
and the key leadership positions in the executive, the new policy elites were poised to propose
and scrutinize the agenda and check their feasibility against EPRDF‘s policy blueprints. Despite
the fact that the TGE Charter empowered the transitional legislature to initiate and promulgate
laws and policies, to all intents and purposes, reframing policies to match their designs
increasingly became the exclusive preserve of the new policy elites.
The official policy making institutions, 1995-2004

The House of peoples‟ representative ( HPR)
The Ethiopian parliament consists of two chambers, the House of Federation (HoF), and the
House of Peoples’ Representatives (HPR). However, unlike countries practicing a
parliamentary form of government, the former has no legislative powers. The members of the
HPR are elected for 550 seats in parliament for five years from electoral districts constituted as
such, with each district or constituency having a population of 100,000 (FDRE, 1995). For
instance, deputies won 546 and 547 seats in the general elections held in 1995 and 2000
respectively. Despite objections by the opposition for unfairly allocating advantages to the
parties having uninhibited prior access to state and power resources, deputies to the HPR are
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elected by the first-past-the-post system (plurality of votes cast) (FRDE, 1995; Dessalegn and
Meheret, 2004). Twenty seats are, however, reserved to provide for representation of minority
ethnic groups in the HPR. MPs, as is presumably the case around the world, enjoy immunity
from prosecution and/or will not be subject to any criminal and civil proceedings while attending
to legislative duties or be reprimanded unless caught in flagrante delicto. Members of the HPR
shall have the liberty to pay their allegiance to the constitution, the wish of the people and their
conscience, although most of the opposition and independent members of HRP questioned
whether the ruling party’s
(EPRDF’s) members of HPR abide, inter alia, by their conscience41. The twice-weekly
(Tuesdays and Thursdays) plenary sessions of the HPR start towards the beginning of October
and continue to the 9th of July of the following year annually. The HPR is the highest authority
with a wide range of legislative functions (FDRE, 1995: 18). Its powers evolved from the broad
federal jurisdictions assigned to it and the executive. Its competences include passing laws on:
utilization of land, rivers and lakes crossing national boundaries and connecting two or more
national regional states (NRSs); inter-state and foreign trade; air, rail, water transport operating
in two or more NRSs, postal and telecommunication services; enforcing the rights enshrined in
the constitution, including legislating electoral procedures; enacting labor and commercial codes.
The HPR also enacts civil laws, when it so desires and/or requested to do so by the HoF; declares
a state of emergency and state of war as and when the executive demands; approves the broad
socio-economic and fiscal policies of the country, and passes laws on such issues as local
currency, the national bank and foreign exchange; levies taxes and collects duties reserved for
the federal government, and approves the central government’s (federal) budget; ratifies
international agreements concluded by the executive; approves the appointment of judges,
ministers, commissioners and other officials seconded by the executive; establishes the
institutions of human rights and ombudsman; and questions and/or investigates the Prime
Minister and members of the executive (ibid: 21-22). In view of the stringent party lines and
discipline that EPRDF deputies have in fact been enjoined to observe, the latter has never taken
place and is probably unlikely to materialize in the immediate future. The Speaker of the HPR,
and in his absence his deputy, presides over the plenary and ad-hoc sessions, and on behalf of the
House acts as liaison with domestic and international agencies, leads, and administers its affairs
and coordinates the various committees (FDRE, 2002).
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The HPR has the power of legislation, the power to question the Prime Minister and other top
officials of government agencies, to examine both the executive’s handling of its powers and
discharge of its duties, taking measures should these have been misused (FDRE, 1995).
However, party discipline and structure combined with a lack of competence among the bulk of
the MPs, militated against the exercise of their legislative duties detailed in the constitution and
other by laws. In any case, calling the executive to account for its behavior and actions, and
investigating its performances, are the responsibility of the HPR. The Chief Executive (the Prime
Minister), for instance, annually presents himself twice before the House, in October to map out
his plans for the year and in early July for the assessment of his government’s performances
during the year. Nevertheless, in essentially substantive sense of the word-debate (vivacious
debate, as such) - in the HPR takes place, and in some cases acrimonious debate often flares up
between him and the opposition, each time the Prime Minister appears before the House to
deliver reports. Likewise, the head of each ministry or government agency annually delivers
reports outlining action plans for the year, and presents budget appropriations in some detail,
which in most cases are followed by an outline of the accomplishments and problems
encountered in the course of the year.
The House of Federation (HoF): a non-legislative chamber

Elected for five years, the second chamber of the Ethiopian parliament, the House of Federation
(HoF), has come to symbolize ethnic representation and the embodiment of nations, nationalities
and people (NNPs). Although critics claim that the phrases have entirely been borrowed from the
earlier works of Joseph Stalin, the new constitution defines the NNPs as ‘a group of people
who have or share a large measure of common culture or similar customs, mutual intelligibility
of language, common or related belief of identities, a common psychological make up, and who
inhabit an identifiable, predominantly contiguous territory’ (FDRE, 1995: 14, Assafa, 2002).
Not only does a member represent each ethnic community in the HoF, one additional member for
every one million of its population can also represent each ethnic community. As provided under
the new constitution, each state legislature, or, State Council elects representatives to the HoF, or
may opt to have the people elected their representatives (FDRE, 1995, 2001). Two terms having
been served, no popular elections have so far been held to send representatives to the HoF.
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Hence, NRSs’ parliaments appointed 108 and 112 members representing 59 and 66 NNPs,
during the first (1995-2000) and second (2000-2005) terms respectively51. In much the same
way as the members of the HPR, the members of the HoF also enjoy parliamentary immunity
from prosecution. Furthermore, while the presence of twothird of the members constitutes a
quorum, decisions are rather made by a simple majority vote (FDRE, 1995). Although its term of
mandate, as the HPR, is five years, unlike upper houses the world over, it can only sit for two
sessions annually.
Statutes empower the HoF, inter alia, to interpret the constitution, to organize the Council of
Constitutional Inquiry that can assist it in the interpretation of the constitution, to take decisions
on the self-determination of NNPs, including secession as provided for under the constitution, to
promote the equality of the peoples of Ethiopia, to settle disputes, if and when they arise between
two or more NNPs, to determine the division of revenues evolving from central and NRSs tax
sources, to determine formula applicable for the apportionment of subsidies that the central
government earmarks for NRSs (FDRE, 1995, 2001). Of all the responsibilities entrusted to the
HoF, the one that vividly marks the constraints of not being a legislative chamber is that it
merely identifies, but does not legislate, civil matters to be enacted by the HPR (ibid.). It can also
order the central government to deploy its military forces to an NRS, if a constitutional crisis
occurs. The previous term and the current term, which is due to expire in June 2005, the HoF
constituted three committees that by and large reflect its multiple responsibilities, and with each
committee comprising eleven members. The committees include: the State Affairs Standing
Committee, which deals chiefly with overseeing the rights of NNPs for self-determination up to
and including secession; the Revenue Administration Committee helps members determine
revenues that arise from joint tax sources and determine the apportionment of central
government’s subsidies to NRSs; and the Legal Affairs Standing Committee, which examines
and calls on the members to attend to civil cases and constitutional oversight (HoF, 1998). To fill
the deficit caused by the ethnic criteria on the basis of which members to the HoF are appointed,
the constitution provided for the establishment of the Council of Constitutional Inquiry (CCI) to
enhance constitutional interpretation. The latter consists of the President and the Vice-President
of Supreme Court, ex-officio president and vice-president of the CCI, six legal professionals
appointed by the Head of the State, and three members elected by HoF (FDRE, 1995, 2001).
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Election of the Head of the State (ceremonial President), listening to his annual address, a
perceived constitutional disorder in any of the NRSs, and constitutional amendment bring both
houses of the Ethiopian parliament for a joint session (ibid).
In view of the power of legislation, and compared with countries that have long instituted a
parliamentary system of government as Ethiopia has recently had, the HoF is, nevertheless, not
an upper chamber in its true sense of the functions that an upper chamber is called upon to
perform. Canada and the United Kingdom are the leading model parliamentary democracies on
which the framers of the Ethiopian constitution professed to have modeled the Ethiopian
parliamentary system of government (Kifle, 2001). To the contrary, the Canadian Senate enjoys
the power of legislation in much the same manner as the House of Lords of the UK and the
Council of Provinces of the South African Parliament, although the ultimate decisions and much
more policymaking powers lies in the lower chambers (the House of Commons in Canada and
UK, and the Legislative Assembly in South Africa) than the upper houses. In fact, the House of
Lords in the UK is also the highest court. To all intents and purposes, the Ethiopian ‘upper
house’ the House of Federation, is nothing but a house of nations, nationalities and peoples
(NNPs), and it simply epitomizes the pre-commitments that the sponsors of the current Ethiopian
constitution cherished during their protracted war with the Dergue. Put differently, both in spirit
and in practice it is an embodiment of ethnic representation, but with the formula predetermined
by the sponsors. The HoF, therefore, unlike its counter-parts in the UK, Canada, South Africa
and most other upper chambers around the world, has no power of legislation, albeit with an
extraordinary stubborn commitment to the NNPs, as the pronouncements in the constitution by
and large stipulate.
Moreover, in the upper chambers of Canada, the UK and South Africa the opposition and the
independent MPs have unrestricted access not only to be elected as members, but also have an
unreserved right to participate in the debates on policy and legislative matters. On the contrary,
while it is difficult to ascertain the exact figures of party affiliation for all the members of the
HoF, the appointments of members of the HoF by NRSs’ Councils, which are overwhelmingly
dominated by the ruling party, with all the seats won by EPRDF affiliates as in Amhara and
Tigray NRSs, would attest to the fact that it is much less likely for the opposition and
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independent elements to make their debut in HoF. Far worse, the house, which decides on vital
issues such as the interpretation of the constitution, self-determination up to and including
secession, and the sharing of national wealth, is totally inaccessible to civil society and the public
at large, nor has there been any channel of communication linking the non-state actors to the
HoF, so much so that the former have little or no space for influencing the critical policy
decisions of such serious of fundamental importance that affect their lives.
The executive: spearheading the legislative/policymaking/ process
The 1987 PDRE’s constitution vested the ceremonial and executive powers in the Head of the
State (i.e. the President), although some portion of the executive and administrative powers had
also been assigned to the Head of Government (i.e. the Prime Minister) (PDRE, 1987). The
current constitution entirely reversed the allocation of powers, assigning the Head of the State
(i.e. the President) and the Head of Government (i.e. the Prime Minister) ceremonial and
enormous executive powers respectively. Nominated by the HPR, the joint session of the two
houses of the Ethiopian parliament elects the President of the FDRE by a two-third majority.
Unlike the parliament whose term of mandate expires after five years, the president’s term of
office is for 6 years, and he can continue in office for another term. The constitutional design for
the parliament and the executive’s stay in office a year less than the President is to establish a
continuity of government and linkage between the preceding and the forthcoming terms (Fasil,
1997). In any case, the latter’s duties are invariably nominal. Among others, these include
addressing the joint session of the parliament annually, appointing ambassadors, granting high
military titles, and decorating high domestic and foreign dignitaries with medals and prizes, of
course, after having been recommended by the Prime Minister (FDRE, 1995). The constitution
assigned the President little role in the policymaking process. He signs bills into laws following
their approval by the HPR, although laws can still take effect within fifteen days with or without
his signature (ibid.). Enormous policymaking power in Ethiopia is vested in the executive. The
latter is comprised of the Prime Minister and the Council of Ministers (CoM). Although the
‗election‘ of the President and the Prime Minister is often concluded at the party forums behind
the parliamentary scenes, the joint session of parliament and the HPR designate the President and
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the Prime Minister respectively as provided for in the constitution. Hence, elected by the HPR
for five years, the Prime Minister is the chief executive officer, the chairman of the CoM, and the
commander-in-chief of the armed forces of the country (FDRE, 1995). The current constitution
limits the Head of State’s term of office to two; ironically, it is silent on the Head of
Government’s term of stay in office, though the latter possesses such a huge responsibility and
enormous powers that are susceptible as to be misused. The Prime Minister can have the HPR
approve his nominees for the ministerial positions who, together with him, constitute the second
leg of the executive (ibid.). He presides over the entire implementation process of laws and
socio-economic and foreign policies of the country.
Consisting of the Prime Minister, his deputy, heads of the ministries and other government
officials whom the PM wishes to be members, the second aspect of the executive constitutes the
Council of Ministers (CoM) (FDRE, 1995, PMO, 2003). Its competences revolve around the
initiation, formulation and supervision of the implementation of socio-economic and foreign
policies (ibid.). In fact, despite being subject to approval by the HPR, the CoM has control over
the power of the purse, essentially because the latter remains in the limelight for much of the
formulation, arrangement and the execution of the budget. The CoM holds regular sessions once
in a week, and conducts emergency sessions when situations requiring such meetings arise.
Besides, performance evaluation sessions are scheduled quarterly, or four times annually. Half of
the members the Council of Ministers constitute a quorum, and decisions are madeby a simple
majority vote.
Nevertheless, one should not fail to stress that, in the Ethiopian context; the machinery of the
legislative process starts rolling from the premises of the executive and is concluded with the
seal of approval in the parliament building.
The legislatures as legitimating institutions of policy decisions

The predominance of the party in every sphere of public life, coupled with the zeal with which
revolutionary democratic objectives are advocated, generate an exclusive interest in, and claim
on, public policies. Party ranks at higher levels primarily decide policy matters, for the most part
immediately preceding the adoption of the same by legislative bodies. Once consensus has been
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reached on the lunatic fringes in the party and executive leadership, policy decisions are pushed
through for government institutions to formalize, legitimate and implement them. The
parliaments, both national and NRSs, are the chief instruments of legitimizing the policy
decisions of party and executive leadership, although concerns and questions still persist among
the civil society leaders and academics concerning how far legislatures of such stature overcome
the overriding challenges of the imbalance between policymaking institutions and policy
beneficiaries in Ethiopia. For some, the party and executive leadership’s overwhelming
leverage in public policymaking as much rests on constitutional guarantees as on the majority
seats in the parliament. In other words, the Constitution sets the rules and defines parameters for
how should policies be made and executed, and who should do so; thus not only are the party
and the executive acting accordingly, but also do they see no wrong in this exercise EPRDF, in
its own assertions, reinforces this point:
Only when a political party seizes state power that it can translate the demands of the
social group that it represents into concrete deeds. Since a political party is established
based on the good will of the forerunners who adopt and promote its objectives, it hardly
accomplishes the objectives it sets out till the vanguards are elected to assume
government offices. A political party should therefore target political power as a major
goal, and then use that power to translate its program into effect. This can range from
having its program objectives and strategies incorporated into the constitution to
transforming it into government policies and strategies. Not only does it use state power
to make laws and policies, but also should advantageously use it to implement policies
and programs. The assumption of state power per se therefore is both a goal and an
essential tool for the achievement of party objectives.
However, the making of the constitution has largely been flawed, and the socio-political order
that evolves from it is bound to be suspect, as empirical evidence showed.
Although constitutional and statutory provisions have clearly bolstered the leverage of the
executive and party leadership, the issue at stake and of vital importance is how far has this
affected the legislatures and with what effects. The party, in practice often but not always led by
the Prime Minister, controls the government; the parliament is totally dominated by the EPRDF,
and in practice is only an organ to rubberstamp government decisions.
629
Furthermore, the party controls the local administration, particularly in rural areas, and by that
the population and the elections. Officially Ethiopia is a parliamentary democracy, but much
takes place behind the scenes, and the key party figures, with the Prime Minister as the
outstanding figure, have the power to make and unmake the power base of any participant in the
system, whatever that base may be (popularity shown in elections, prominence in the public
discussion, leading administrator, etc.). The anomaly lurking behind the constitutional order,
however, is that it breeds a glaring imbalance between the legislature and the executive. The
constitution introduces a parliamentary form of government, and one probably would see little
problem with the EPRDF instituting a parliamentary structure, for it is one of the most
democratic systems. Similar structures abound the world over; the UK, Canada and Israel are
classic cases, just to name a few of the well-established parliamentary democracies. Apparently,
the parliamentary form of government requires the PM and the bulk of the associates of the
executive to be drawn from the parliament, and thus they are accountable to the parliament104.
Nevertheless, in countries without a well-developed and nurtured democracy, and pluralistic
political culture are significantly absent, vibrant civil society organizations (CSOs) and a strong
opposition are non-existent, such as Ethiopia, the system is likely to promote the exclusive power
of the executive leadership. What makes the Ethiopian political system even more interesting
than similar situations elsewhere, is that a single party occupies well over 95% of the seats in the
parliament As a result, not only does the party establish the government, but the members of
parliament and the executive also belong to one party. Therefore, instead of the parliament
controlling the executive, ironically, the executive is effectively controlling the parliament in
Ethiopia. Additionally, the Prime Minister is the leader of both the party as well as the executive,
for the PM has to balance all relevant institutions. The party and the executive have, certainly, a
predominant role as well as leverage in policymaking in Ethiopia. In contrast, despite the fact
that the UK has a similar structure, the opposition parties are so strong that they can counter-
balance and challenge the actions of the executive. Equally important, if value conflicts within
the party in power in the UK, the ruling party MPs have virtually no fear in challenging their
party and its leadership if they find their party advocating misguided policies, nor do the
opposition MPs fear any harassment and reprisals if they challenge the ruling party106. Put
differently, the ruling party MPs in parliamentary democracies, unlike in Ethiopia, are more
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accountable to their conscience than to party ideology. This by far sets the Ethiopian
parliamentary system apart from other parliamentary democracies.
The establishment of separate legislative and executive institutions in Ethiopia is considered as

the division of labor within the EPRDF, whereby a segment of the EPRDF and its supporters
constitute the legislature and another subdivision forms the executive. The balance of power and
attendant checks and balances that underpin the separation of power in its substantive sense is
left nothing to be desired. One party has dominated the legislative as well as the executive, so
much so that national and NRS parliaments symbolize a single party state in all substantive and
imaginable senses of the concept. The last thirteen years has, therefore, witnessed a single party
dominating the entire process of policymaking in Ethiopia.
This would mean that the legislature has little choices of exploring alternative public policies
beyond the confines of the established party lines. Moreover, this has been complicated by the
inner party ‘democracy’ and discipline that militate against creative initiative, for party
members are barely allowed to promote ideas other than those of the party. Personal choices
made otherwise are considered seditious actions against the party, so are subject to admonitory
measures, which may include severe reproaches at best, and expulsion from party and
parliamentary membership at worst113 (EPRDF, 2003a). In other words, conceived primarily on
the basis of revolutionary democratic ideals, party members have virtually been assigned seats in
the legislatures in so far as they promote these goals. The same party document resentfully cited
several incidences party members in the HPR acting in breach of the basic belief system of
EPRDF. Among others the bills sent by the executive (PMO) to provide for the revision of the
Charter of Addis Ababa City Government, anti-corruption legislation and the motion put forth to
augment the executive’s leverage in the mass media board were classic cases in which the
loyalty of EPRDF MPs faltered and for which they were severely chastised (EPRDF, 2003a: 66).
Not only has this been seen as an infringement of the constitutional guarantees of free expression
of one’s views, but the MPs have also been reduced to party puppets who should put their
hands out when they are told to do so, in support of party-sponsored legislation and motions. In
other words, MPs are merely considered as manufacturers of party-sponsored proclamations and
professional attendees of wearisome executive narratives. Nevertheless, it is interesting to note,
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on the other hand, that for most EPRDF MPs, it serves no purpose to be a member of a party,
unless one firmly promotes the goals of the party and supports it in all its dealings. The
opposition parties should rather table any challenge to the proposals of the ruling party, but not
the EPRDF members. Having seen no difference between party and the executive leadership,
some ruling party members of the HPR have bestowed enormous trust on the executive, in terms
of the capability to articulate policies and the competence to implement them. They are very
strongly and candidly of the view that not only they have no objections to the executive presiding
over or prevailing on the entire policymaking process, but there is also nothing wrong for the
executive to command an overwhelming influence, for many of the persons in the executive are
members of the HPR representing their positions. They further contended that officials in the
executive are also in the political leadership (or are party leaders); thus they are in a better
position than the legislature to be able to articulate and forge policies along party lines. The
members of the executive, EPRDF MPs contended, are close to the world of politics as well as
knowledgeable, so much so that they are better placed to initiate laws and formulate policies.
What is more, these EPRDF MPs see nothing unconventional for the party and the executive
leadership having overwhelming influence in the policymaking and legislative process, not only
because the party and the executive leadership possess, expertise, knowledge and competence in
formulating policies and legislation by far better than MPs, but they also have the statutory
power and access to resources to be able to marshal them for the execution of laws as well as
policies.
Some EPRDF MPs have, on the contrary, perceived that the party has been engaged in a
disciplining and muffling exercise, through a series of evaluations (Gimgema) carried out
continuously around the residential areas. In other words, party rules and discipline, which have
little official recognition in the HPR, weigh against the free expression of views in the
parliamentary deliberations. In fact, for some of EPRDF MPs even a slightest deviation from
party lines may endanger one’s career, may even mean the loss of one’s parliamentary seat,
and so they are careful ‘not to make any mistake’ that would embarrass party branch
functionaries assigned to monitor and defend the ruling party’s interests. Stuck between their
personal conscience and public political life, some EPRDF MPs, therefore, continue to live in a
climate of fear and angst.
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In short, the legislative process is far more complicated than one would imagine. The Ethiopian
lower house, the HPR, has been fraught with a legion of problems. Primarily, the MPs are not
meant to question the laws and other proposals delivered to them from the party and the
executive, although MPs are accountable to the electorate, to their conscience and to the
Constitution; as provided under the current Constitution. To say the least, stringent party
requirements are imposed on the EPRDF MPs, who constitute the great majority in the HPR, to
vote for any legislation sent to the House by the executive, regardless of their consent.
Second, while there is division of labor between the legislature and the executive, the separation
of power, which is at the hub of checks and balances between the former and the latter, is non-
existent. Third, even if the House has constitutional guarantees to closely control the actions of
the executive, the ability and expertise among most of MPs for such an oversight role has left
much to be desired. Nor is the Secretariat of the House staffed with experts, so much so that they
get the assistance/advice from the experts that this endeavor calls for or to be able to adequately
discharge their legislative responsibilities over the executive. In other words, not only is there a
dire shortage of professional and administrative support staff, but the available employees have
not been well enough organized for the MPs to be able to subpoena the executive. Till the end of
May 2004, for instance, only 31% of the required staff had been acquired. A more glaring and
acute staff shortage has conspicuously surfaced in the areas where it has been badly needed,
namely in the fields of professional legal support and research. Of the 329 support staff
employed by HPR, professional staff constitutes only 18.5% (61 employees) of the total support
staff, with low pay and declining morale characterizing almost or all of them.
Fourth, led and controlled by the Speaker and his deputy, the parliament‘s secretariat is less one
of providing effective leadership, which could have brought the MPs with more experiential
learning and capacity-building exercises, than of protecting party interests, although there has
been cautious optimism in this regard over the past two years. The Speaker and Deputy Speaker
of the HPR more often than not discourage lively discussions and debates in the HPR. In fact,
thorough deliberations have been discouraged, especially when the opposition and independent
MPs raise queries and contentious issues, for which they have been very swiftly undermined.
Last, the weak intellectual capacity of most of the opposition MPs to be able to generate
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meaningful alternatives as well as the political skills to garner support in the House‘s legislative
debates, coupled with the preeminence of one party, have reduced the HPR into being a mere
manufacturer of legislation, and MPs into professional consumers of mind-numbing annual
reports of heads of the government.
Reading Books
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COURSE 10: THEORIES AND PRACTICES OF GOVERNANCE
Chapter One
Conceptualization of Governance
1.1The origin and evolution of the concept of governance
Governance was traditionally associated with government, with the exercise of power by
political leaders. The concept was not widely used in the exercise of power by political leaders.
The concept was not widely used in the post-Second World War years, but during the 1980s it
re-emerged with a new meaning, now referring to sometimes broader than government was now
included; yet no common definition of governance seemed to emerge (Kjaer 2004). Governance
is used in various fields, such as economics, cultural geography and politics. The usage of the
concept of governance, then, is applied in many different contexts and with as many different
meanings. There is not one coherent body of governance theory, and it is difficult to get clear
picture of what governance theory is about.
The term governance can be used specifically to describe changes in the nature and role of the
state following the public-sector reforms of the 1980s and 1990s. Typically, these reforms are
said to have led to a shift from a hierarchic bureaucracy toward a greater use of markets,
quasimarkets, and networks, especially in the delivery of public services. The effects of the
reforms
were intensified by global changes, including an increase in transnational economic activity and
the rise of regional institutions such as the European Union (EU). So understood, governance
expresses a widespread belief that the state increasingly depends on other organizations to secure
its intentions, deliver its policies, and establish a pattern of rule.
By analogy, governance also can be used to describe any pattern of rule that arises either when
the state is dependent upon others or when the state plays little or no role. For example, the term
international governance often refers to the pattern of rule found at the global level where the
United Nations (UN) is too weak to resemble the kind of state that can impose its will on its
territory. Likewise, the term corporate governance refers to patterns of rule within businesses—
that is, to the systems, institutions, and norms by which corporations are directed and controlled.
So understood, governance expresses a growing awareness of the ways in which diffuse forms of
power and authority can secure order even in the absence of state activity.
More generally still, governance can be used to refer to all patterns of rule, including the kind of
hierarchic state that is often thought to have existed before the public-sector reforms of the 1980s
and 1990s. This general use of governance enables theorists to explore abstract analyses of the
635
construction of social orders, social coordination, or social practices irrespective of their specific
content. They can divorce such abstract analyses from specific questions about say, the state, the
international system, or the corporation. However, if we are to use governance in this general
way, perhaps we need to describe the changes in the state since the 1980s using an alternative
phrase such as ―the new governance.‖
Whether we focus on the new governance, weak states, or patterns of rule in general, the concept
of governance raises issues about public policy and democracy. The increased role of non-state
actors in the delivery of public services has led to a concern to improve the ability of the state to
oversee these other actors. The state has become more interested in various strategies for creating
and managing networks and partnerships. It has set up all kinds of arrangements for auditing and
regulating other organizations. In the eyes of many observers, there has been an audit explosion.
In addition, the increased role of nonelected actors in policy making suggests that we need to
think about the extent to which we want to hold them democratically accountable and about the
mechanisms by which we might do so. Similarly, accounts of growing transnational and
international constraints on states suggest that we need to rethink the nature of social inclusion
and social justice. Political institutions from the World Bank to the EU now use terms such as
good governance to convey their aspirations for a better world.
Governance is not synonymous with government. Both refer to purposive behavior, to

goaloriented activities, to systems of rule; but government suggests activities that are backed by
formal authority, by police powers to insure the implementation of duly constituted policies,
whereas governance refers to activities backed by shared goals that may or may not derive from
legal and formally prescribed responsibilities and that do not necessarily rely on police powers to
overcome defiance and attain compliance. Governance, in other words, is a more encompassing
phenomenon than government. It embraces governmental institutions, but it also subsumes
informal, non-governmental mechanisms whereby those persons and organizations within its
purview move ahead, satisfy their needs, and fulfill their wants.
Governance is the exercise of political, economic and administrative authority in the

management of a country‗s affairs at all levels. Governance comprise the complex mechanism,
processes, and institutions through which citizens and groups articulate their interests, mediate
their differences, and exercise their legal rights and obligations (UNDP, 1997).
Defining Governance
There are various definitions of governance. They are given below:
It is the exercise of political, economic and administrative authority in the management of a
country‗s affairs at all levels. Governance comprises the complex mechanisms, processes, and
institutions through which citizens and groups articulate their interests, mediate their differences,
and exercise their legal rights and obligations.
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Governance includes the state, but transcends it by taking in the private sector and civil society.
The state creates a conducive political and legal environment. The private sector generates jobs
and income. The civil society facilitates political and social interaction – mobilizing groups to
participate in economic, social and political activities. Because each has its weaknesses and
strengths, a major objective of our support for good governance is to promote constructive
interaction among all three.
The regularized ways of ordering human societies at all levels of organization from family units
to entire societies
UNDP Internet Conference Forum on "Public Private Interface in Urban Environmental

Management"
4. Governance refers to the process whereby elements in society wield power and authority, and
influence and enact policies and decisions concerning public life, and economic and social
development. Governance is a broader notion than government. Governance involves interaction
between formal institutions and those of civil society.
The Governance Working Group of the International Institute of Administrative Sciences 1996.
5. There is no alternative to working together and using collective power to create a better
world. Governance is the sum of the many ways individuals and institutions, public and private,
manage their common affairs. It is a continuing process through which conflicting or diverse
interests may be accommodated and cooperative action may be taken. It includes formal
institutions and regimes empowered to enforce compliance, as well as informal arrangements
that people and institutions either have agreed to or perceive to be in their interest.
Examples of governance at the local level include a neighbourhood cooperative formed to
install and maintain a standing water pipe, a town council operating a waste recycling scheme, a
multi- urban body developing an integrated transport plan together with user groups, a stock
exchange regulating itself with national government oversight, and a regional initiative of state
agencies, industrial groups, and residents to control deforestation. At the global level,
governance has been viewed primarily as intergovernmental relationships, but it must now be
understood as also involving non- governmental organizations (NGOs), citizens' movements,
multinational corporations, and the global capital market. Interacting with these are global mass
media of dramatically enlarged influence.
Source, The Commission on Global Governance

Governance is the written and unwritten policies, procedures, and decisionmaking units that
control resource allocation within and among institutions New forms of governance allow
individual organizations to contribute their strengths and talents, to discharge their collective
637
responsibilities and to preserve and enhance the distinctiveness of their organizations and
institutions.
There are some writers who associate governance to formal institutions

The term government indicates a political unit for a function of policy making and policy
administration. Therefore, the word governance denotes an overall responsibility of exercising
authority for both political and administrative functions. Good governance refers to the way of
carrying out state functions in a participatory, responsive, transparent accountable, effective and
equitable manner.
The progress of a country depends on the quality of its governance. While a democratic
government may lay the foundation for good governance, a vigilant and active citizenry is
essential to its sustenance. Nowhere is this need more evident than in the management of public
sectors services for which citizens depend largely on their government. The quality of
governance is enhanced when government as a whole and public agencies in particular become
open to new ideas and responsive to citizens. Responsiveness in turn is improved when citizens
are well informed and collectively seek better performance from these agencies.
Source, Policy Affairs Centre
"Governance" is the art of public leadership. There are three distinct dimensions of governance:
the form of political regime; the process by which authority is exercised in the management of a
country‗s economic and social resources; and the capacity of governments to design, to
formulates, and to implement policies and discharge functions.
The criteria that constitute good governance have been drawn from these three dimensions, and
include: legitimacy of government (degree of "democratization"), accountability of political and
official elements of government (media freedom, transparency of decision-making,
accountability mechanisms), competence of governments to formulate policies and deliver
services, Respect for human rights and rule of law (individual and group rights and security,
framework for economic and social activity, participation).
Governance is about the practice of collective decision-making. A regular complaint across all
literatures is that governance is often vaguely defined, and the scope of its application is not
specified. These protests are particularly keenly expressed in our home discipline of political
science. Most reviews on the development of a governance perspective start with the comment
that governance has been used in a variety of ways in the political science literature (for example
Kjaer, 2004; Pierre and Peters, 2005; Jordan et al., 2005) and note some difficulty with definition
and focus in using the concept. According to Pierre and Peters (2000:7) the concept of
governance ‗is notoriously slippery‗ and Schneider (2004:25) comments that the conceptual
638
vagueness of the term is the ‗secret of its success‗. As Kohler-Koch and Rittberger (2006:28) put
it bluntly despite decades of work ‗there is still confusion about the conceptualization of the
term‗.
To address anxieties over the scope and coverage of the term governance, we offer the following
basic definition. Governance is about the rules of collective decision-making in settings where
there are a plurality of actors or organisations and where no formal control system can dictate
the terms of the relationship between these actors and organisations. There are four elements
about this definition that are worth dwelling on a little bit more. First, we should clarify what we
mean by rules. The rules embedded within a governance system can stretch from the formal to
the informal. Decision-making procedures generally find expression in some institutional form
and can be relatively stable over time, although not necessarily unchanging. Indeed one reason
for growing interest in governance is precisely because established institutional forms of
governance appear under challenge, and new forms of governance appear to be emerging. In
studying governance we are interested in both the formal arrangements that exist to structure
decision-making and the more informal practices, conventions and customs. In short we are most
often interested when it comes to governance in what Ostrom (1999:38) refers to as ‗rules-
inuse‗, the specific combination of formal and informal institutions that influences the way that a
group of people determine what to decide, how to decide, and who shall decide: the classic
governance issues.
The concept of „collective‟ is the second element in the definition that is worth dwelling on.
Collective decisions are, rather obviously, decisions taken by a collection of individuals. But
crucially although we can normally express our preferences through various mechanisms by way
of the agreed decision-making processes, the outcomes of the process are then imposed (Stoker,
2006a: Ch 4). You are not guaranteed what you want even in a system of formally democratic
governance. Collective decisions involve issues of mutual influence and control. As such
governance arrangements generally involve rights for some to have a say, but responsibilities for
all to accept collective decisions.
Thirdly, we should dwell on what we mean by decision-making. Decision-making can be

strategic but it also can be contained in the every day implementation practice of a system or
organisation. Deciding something collectively requires rules about who can decide what, and
how decision-makers are to be made accountable. Governance frameworks can focus on
collective decision-making in societal systems or internal processes within organisations.
Governance can be concerned about collective decision-making on global issues, and concerned
about the rules governing a local executive or administrative body. It is important to recognise
these macro and micro elements of the governance debate and distinguish between them. But
equally it can be noted that micro and macro perspectives are connected to one another and
639
although most of the literature we review tends to take a more macro perspective, we consider
that both perspectives offer something of value.
The final element in our definition of governance that deserves further attention, is the idea that
in governance „no formal control system can dictate‟ the relationships and outcomes. Or put
another way: governance is a world where ‗no one is in charge‗. Monocratic government –
governing by one person is the opposite of governance, which is about collective governing.
Authority and coercion are resources available to some in governance arrangements but never in
sufficient quantity or quality to mean they can control the decision-making process. The
characteristic forms of social interaction in governance rely on negotiation, signals,
communication and hegemonic influence rather than direct oversight and supervision.
The study of governance is focused not just on aiding a better understanding of part of our world,
but it also has a concern with how the functioning and operation of that world could be made
better. The interdependence of our lives makes constructing mechanisms for collective
decisionmaking an essential and significant human activity. The construction of governance
regimes
matters to the well-being of our societies. The world recognizes that the under-development of
Africa is in part due to failures in national and international governance regimes. It is
increasingly aware that if environmental issues are going to be resolve then global governance
issues around the making of binding collective decisions will need to be resolved in order to
resolve issues of global warming.
Governance scholars are interested in how governance arrangements are chosen (intentionally or
unintentionally), how they are maintained or how they are changed. But governance is not a
science with clear causal pathways to be identified, nor can it be adequately captured by laws,
statutes or formal constitutions. Governance is a practice. Governance is undertaken by human
agents who are defined by bounded rationality – limited by their information processing
capacities – and constrained by conflicting power positions and perceptions. Two things flow
from this statement. First governance is a political activity; it is about coordination and
decision-making in the context of a plurality of views and interests. Conflict and dissent provide
essential ingredients to a governance process. Given human society, as it has been and as it might
reasonably be expected to be in the future, people will make judgements about what is right for
themselves and for others, and that there is no reason to assume that those judgements will be
shared. Equally it is clear that as humans we need to find ways to act together, to engage in
collective action, to resolve the problems and challenges of living together. John Dunn (2000:73)
defines politics as ‗the struggles which result from the collisions between human purposes: most
clearly when these collisions involve large numbers of human beings‗. Politics informs
governance in that it provides the raw material both to construct governance arrangements and
the focus of much governance activity when it is operating.
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The second factor to flow from our assertion that governance is an intensely human activity is
that its existence to some extent is explained by the limits of our human capacities. If we are
allseeing and knowing and could faithfully predict each other‗s behaviour then the frameworks
and rules of governance would be unnecessary. We could exchange views and resolve conflicts
without resort to institutions and practices that simplify our choices, limit our areas of focus,
push our understanding in certain directions and provide rules of thumb or heuristics so that we
have a rough idea about what to do in different settings. Governance exists in part because it
provides us with effective ways to cope with the limitations of human cognition and
understanding. It provides architecture for choice in the context of our bounded rationality
(Jones, 2001).
Evolution and Development
Use of the term "governance" in place of "government" goes back at least to the work of Harlan
Cleveland (1972) and was a way of distancing authors "from the traditions of public
administration and from criticisms of bureaucracy" (Frederickson, 1999: 705). Governance has
moved in the last two decades from the status of a lost word of the English language to a
fashionable and challenging concept in a range of disciplines and research programmes.
Governance theory offers a valuable and challenging dimension to our understanding of our
contemporary social, economic, and political world. The key disciplines investigated in the
context of Governance are politics, economics, development studies, international politics and
socio-legal studies. The rise in interest in governance reflects changes in our society, and
researchers‗ attempts to come to grips with the new empirical phenomena and practices that they
are observing. The twin forces that mark out this era of change over the last few decades, we
suggest, are globalisation and democratisation. These are the implications of our growing
interdependence in a context where the expectations of citizens to influence the decisions that
affect them have increased the pressure on established systems of collective decision-making,
and brought forth demands for new forms of governance. Governance has become a focus of
academic and practical discourse because traditional literatures and ways of explaining were
inadequate to the task. The world has changed and the rise of governance seeks to understand the
implications of these changes, and how they might best be managed.
Governance seeks to understand the way we construct collective decision-making. Its

introduction as a term into our debates, coincided with a sense that existing models were failing
to capture what was happening, and not providing an appropriate framing of key issues for
reformers. In both political and economic spheres, the established ways of making collective
decisions have come under challenge. The basic unit of political organisation, the nation-state
has been challenged by the complexity of social problems, the strength of organised interests,
and the growing internationalisation of interdependencies (Benz and Papadopoulos, 2006). The
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basic unit of the economy – the firm – has found itself the focus of new consumer demands,
complex regulatory calls for ethical and social responsibility, and its institutions have to operate
in an increasingly global market (Mallin, 2003). Much of the governance literature is about
capturing the response to that changing world.
Collective decisions have still to be made by states and governments at all levels, and policy and
strategic objectives have to be established by firms. Governance asks how these tasks can be
undertaken with effectiveness and legitimacy. In the past, elections could be seen as giving
governments the mandate and the state had the resources of finance, knowledge, organisation,
and authority, to ensure that social coordination was achieved. Similarly, firms dealt with their
businesses in relatively autonomous way sanctioned by the traditions and legal requirements of
their national setting. Both states and firms now face challenges to their legitimacy and
effectiveness that require them to consider alternative ways of making decisions.
Four major influences helped bring governance theory to the fore:
The concept of "governance" was used in the 1990s by the "new public administration," the
National Performance Review, and the reinventing government movement in the United States to
reflect the idea of implementing public policies not just through governmental bureaucracies but
also through a variety of public-private partnerships, outsourcing, and privatization.
A parallel influence in the 1990s was the growing importance of networking (including
electronic networking) in policy development and coordination: governance was associated with
networking, whereas government was associated as a term with traditional bureaucratic
hierarchies in public administration (ex., Hajer & Wagenaar, 2003).
As a third influence, governance theory in public administration drew directly on governance

theory in the corporate and non-profit sectors, where authors like Fishel (2003) were concerned
with designing governing boards which might give organizations a competitive advantage
through network ties.
Fourth, governance theory seemed particularly germane to European authors as they wrestled
with how to conceptualize the policy implications for democratic government as policy-making
shifted from nation-states to the European Union. The concept of multi-level governance, with
its emphasis on networking of policy communities, seemed better calculated to reinforce
democratic values than did traditional notions of hierarchical control exercised by EU
bureaucrats even further removed from the people than had been national governments (ex.,
Smith-Hillman, 2006). .
Beyond this, governance theory cropped up as a useful concept in a wide variety of contexts
ranging from international relations in the "new world order" after the Cold War (Rosenau &
Czempiel, 1992; Hewson & Sinclair, 1999) to the interaction of the political and economic
642
sectors in fostering democracy (Feng, 2005) to governance of the Internet (Maclean, 2005).
Today, "governance theory" is a broad umbrella, covering almost any non-hierarchical mode of
policy formation exercised by formal governmental bodies interacting with each other and with
organizations in civil society (ex., Rhodes, 1997; Mayntz, 1998).
Two developments, over the last three decades, have provided the backcloth to the surge in
interest in governance. The first is the extent and degree of globalisation. The second is the
spread of basic institutions of democracy and more generally the triumph of the democratic ideal.
These are significant changes in our world and constitute defining features of our historical era.
Although governance theory obviously touches on themes visited by previous scholars, what
makes the current governance turn new is the context for the current debate: a context defined by
substantial social and economic change.
Something fundamental is happening to our economies and the umbrella term ‗globalisation‗ is a
good one to capture what is going on. There has been a strong trend towards a world of more
rapid world-wide communication, closer connections between peoples and organizations and a
greater sense of interconnectedness. Economies appear to be more interconnected, patterns of
migration have taken on powerful and challenging directions, environmental pressures on the
world‗s resources seem to be both more intertwined and more pressing than in the past and the
speed and pace of communication and the sharing of ideas and practices throughout the world
appears to be offering new opportunities but also threats. But the importance, meaning and
impact of globalisation are a matter of dispute (Scholte, 2005). Some writers suggest that the
forces of globalisation are so powerful that they are sweeping away all efforts at human steering.
Globalisation has fundamentally changed the context for governance but not removed its
prospects completely. We live in a world where there is a significant further development
towards a global market in which patterns of production and consumption are organised by
transnational companies and other related organisations, operating across national boundaries.
Global finance markets and patterns of international trade in turn influence the shape of national
economies. In the industrialised countries these forces are experienced in terms of sweeping
changes in the economy with old style industrial jobs declining and new style service and high
technological jobs emerging. Consumers in these countries observe an increasing amount of
goods coming from outside their national boundaries as their economies are brought into the grip
of a global market to a greater degree than before. In the non-industrialised parts of the world
consumers face new economic demands and some new opportunities. But so far at least,
globalisation has presented little scope to redress the disparity between rich and poor countries;
indeed it may have worsened the position of some poor countries. However, as Andrew Gamble
(2000:46) points out: ‗Acceptance that there is something called globalization, or at least that
there are certain trends towards a global market, is not the end of the argument but the beginning
of it, since there are so many ways in which states and groups can adjust to these changes‗.
643
Globalisation does not provide an end to argument but rather a new starting point to it. There
remains space for governance solutions to emerge. Another reason why governance prospects are
opened, rather than diminished, by social and economic developments, is that what we have seen
is as much a process of regionalisation as pure globalisation. As Colin Hay (2007:139) argues
‗the world economy is regional and triadic…but it is neither global nor globalizing‗. In a
purely
descriptive sense, globalisation is not the dominant experience of the last three decades in
economic terms; rather we have seen the reinforcement and development of three powerful
economic blocks. The triads are: North America, Europe and South-East Asia. Developments in
economics and society in these areas, have met with a governance response, most obviously in
the case of the European Union. In short the regionalisation of our economies has created space
for regional governance.
Democratisation presents the other great force for change in our world. Although in 1974 less
than three in ten nations in the world could be classified as democratic, 20 years later in 1994
that number had grown to six in ten and at the beginning of the 21st century most of these newly
established democracies have survived and joined by a few more recruits (Diamond, 2003). But
it is not just the spread of the basic institutions of liberal democracy that is historically unique
about the current period; it is that the idea of democracy has gained a certain universal appeal. As
Nobel Prize winning academic Amartya Sen (1999:5) points out:
In any age and social climate, there are some sweeping beliefs that seem to command respect as
a kind of general rule – like a ‗default‗ setting in a computer program; they are considered right
unless their claim is somehow negated. While democracy is not yet universally practiced, nor
indeed uniformly accepted, in the general climate of world opinion, democratic governance has
now achieved the status of being taken as generally right.
Democracy is a universal value not because everyone agrees with it. Democracy is a tougher
concept than that. It has been hard fought over, and won respect because it expresses a
fundamental human right to have a say. It can afford, through the power it gives individuals and
communities, some protection against exploitation, and finally because sharing experiences and
thoughts can help us find solutions to intractable problems. The rise of democracy requires space
for governance and lays out conditions for governance practice. The spirit of democracy can
even be seen as having had an impact on the world of corporate governance, with some evidence
of greater assertiveness from shareholders (Daily et al., 2003) and a sense that non-shareholder
stakeholders – employees, customers, suppliers – have some right to have a say in the
decisionmaking of firms.
The literature of politics and international relations on governance might be seen as reacting
directly to the impact of these twin forces of globalisation and democratisation, and the rather
644
different world they are helping to create. The pressures created by these forces obviously create
new dynamics and changed governance practices that have emerged as a focus of attention. The
governance debate in development studies also reflects the intensive impact of these twin forces
to a degree both because of the willingness of an increasingly internationalised world to
intervene in the governance structures of developing countries, and the strengthening of internal
democratic The effects of globalisation and democratisation are not easily demonstrated in the
case of literatures from economic institutionalism, corporate governance and socio-legal studies,
but they constitute a significant framing context for debates in those disciplines.
1.2 Governance without Government: Challenge to the discipline of politics
In the early 1990s, James Rosenau offered the earliest definition of governance in the field of IR.
In his classic work Governance without Government (coedited with Ernest-Otto Czempiel),
Rosenau defined governance as ‗a set of regulation mechanisms in a sphere of activity, which
function effectively even though they are not endowed with formal authority‗ (1992:5). He
distinguished governance from government in that ‗it refers to activities backed by shared goals
that may or may not derive from legal and formally prescribed responsibilities and that do not
necessarily rely on police powers to overcome defiance and attain compliance‗ (1992:4).The
starting point for the emergence of the governance turn in political science and public
administration is the idea that there has been a hollowing out of the state. At the domestic level
the state has become fragmented. This is as a result of managerial changes such as the
introduction of semi-independent government agencies and the greater use of arms-length bodies
of all types to deliver policies, programmes and services (Rhodes, 1997a: Ch5). But the domestic
drive towards fragmentation also reflects pressure from new political forces promoting local and
regional devolution. At a supra-national level the pressure has also led to a plurality of decision
forums with policy and practice choices being made at the level of European Union, or through
other regional level agreements between nation states or even at the international level through
various organisations (Benz and Papadopoulos, 2006). Given the dynamics that were driving an
interest in governance it is the case that the strongest developments in governance theory and
usage came in those parts of the discipline that were dealing with public policy and
administration and multi-level governance. As Simon Bulmer observes in the case of European
Union studies there was often a complex dynamic between practice and theoretical reflection in
the process that led towards a governance turn. The emergence of governance as a theme in UK
and Irish research on the EU governance did not come about as a deliberate ‗turn‗ but rather as a
consequence of several inter-related developments: the emergence of a European Union political
system; the growth in comparative politics analysis of the EU; broader developments in the
political science discipline; and the advocacy of new institutionalism and policy networks as
vehicles for understanding EU governance.
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The focus of governance reflects debates about the EU and about how it should organise its
decision-making and develop its policy procedures, but also recognition among scholars of the
importance of institutions in the way that they shape what policy actors can and cannot do and
operate in a range of formal and informal ways. The governance turn in EU studies might be
seen as leading to a new governance perspective that according to Hix (1998:54) focuses on
governing as ‗multi-level, non-hierarchical, deliberative and apolitical governance, via a web of
public/private networks and quasi-autonomous executive agencies‗. This understanding is
contrasted with a more hard-nosed perspective that sees politics as involving a clash of interests
driven by the self-seeking behaviour of a range of actors. There is nothing inherent in the
governance perspective that argues for an apolitical understanding of the dynamics of
policymaking or a vision of politics without power and it would be a mistake to view the new
focus on governance as tied to an apolitical or managerial understanding of dynamics of social
interaction.
Bulmer suggests that most EU scholars have been happy to combine a focus on a new dynamic
with an understanding of ‗old‗ politics in their analysis, and identifies a range of valuable
contributions that deal with issues of multi-level governance (Hooghe and Marks, 2001), the role
of policy networks in the European decision-making (Peterson and Blomberg, 1999) as well as
other elements in an emerging supra-national governing system.
According to Kohler-Koch and Rittberger (2006:33) ‗the ―governance turn‖ in EU studies

resembles developments in both the field of policy analysis and in IR. First, it has an elaborate
process dimension that explores the patterns, instruments and conditions of policy formulation
and implementation and the diversity of actor constellations. Second, it reflects the different
aspects of ―system transformation‖ (at both EU and national levels) and its likely impact on
problem-solving capacity and democratic accountability‗.
The most distinctive contribution of EU studies has come through its discussion of multi-level
governance. Another prominent feature of EU governance is its multi-level nature. As
KohlerKoch and Rittberger (2006:34) explain multi-level governance takes the line that decision
making capacity is not the monopoly of the governments of the Member States but ‗is diffused
to different levels of decision-making – the subnational, national and supranational levels‗.
Hooghe and Marks (2001:4) comment that: while national arenas remain important arenas for the
formation of national government preferences, the multi-level governance model rejects the view
that subnational actors are nested exclusively within them. Instead, subnational actors operate in
both national and supranational arenas … National governments … share, rather than
monopolize, control over many activities that take place in their respective territories. The
distinctive contribution of EU studies is the way that the governance emphasis on multiple
decision centres is understood in the context of a complex set of exchanges at and between
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different territorial levels including both government and non-governmental actors. In the
spheres of policy studies and public administration the governance turn again reflects that the
world has changed, as well as pressures for new theoretical insights. Governance theory has been
defined by its capacity to provide ‗a reference point which challenges many of the assumptions
of traditional public administration‗ (Stoker, 1998:18).
The first plank of the alternative perspective is to recognise that public administration‗s brief
stretches beyond multiple government institutions to those drawn from the community, voluntary
and private sectors. The role of these non-governmental agencies in delivering public services
and programmes is an important part of the focus provided by the governance perspective. The
second focuses on how responsibilities that might in the past have been defined as exclusively
the domain of government are now shared between government and a range of nongovernmental
actors. According to Salamon(2001):
The upshot is an elaborate system of third-party government in which crucial elements of public
authority are shared with a host of non-governmental or other governmental actors, frequently in
complex collaborative systems that sometimes defy comprehension, let alone effective
management and control. In a sense, the ‗public administration problem‗ has leapt beyond the
borders of the public agency and now embraces a wide assortment of ‗third parties‗ that are
intimately involved in the implementation, and often the management, of the public‗s business.
A third element in rethinking is a greater emphasis on the fragmented nature and condition of the
state. According to Sorensen (2006), alongside those theorists that stressed how societal forces
were gaining ground, were those that focused on the hollowed out and disjointed nature of the
state. They were clear that the state did not act as a unitary body but rather as a complex set of
linked but divided institutions.
Sorensen (2006:100) further argues:
In the 1990s and 2000s, the two theoretical paths… met in a joint effort to develop a new theory
of governance. The starting points for this theoretical endeavour are (a) that the state has become
a differentiated, fragmented, and multicentered institutional complex that is held together by
more or less formalized networks and (b) that the dividing line between state and society is
blurred because of the fact that governance is often produced by networks involving both public
and private actors. Governing in these circumstances involved a capacity to work through
networks both within and without the state. Governance theory then points to a redefinition of
the terrain of institutions and actors that should be a focus of attention.
Rhodes (1997a) and Sorensen and Torfing (2007) can be seen as representative of the
governance without government perspective. Their focus is on identifying how established forms
of governing have come under challenge. For Rhodes (1997a:46) the phase ‗governing without
Government‗ is used explicitly to refer to changes in processes and practices of governing. The
approach establishes that governing relies on actors from both within, but also beyond,
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government and that the complexities of inter-organisational relations thereby created leads to a
‗distinctive managerial style based on facilitation, accommodation and bargaining‗ (Rhodes,
1997a:57). Sorensen and Torfing (2007) examine the emergence of networks which they see as
constituted by stable, negotiated interaction between relatively autonomous actors. All these
writers, while emphasising the role of relatively autonomous networks of societal-based actors in
collective decision-making, still give credence to a governmental role in steering or providing a
meta-governance framing by political representatives and governmental officials. In many
respects the phase ‗governing without government‗is used for rhetorical purposes by these
authors in order to emphasise the changed conditions of governing.
The above line of defence is not sufficient for those taking a stronger line about government still
being a powerful actor, and who reject the idea of governing without governance as empirically
unsustainable (Marinetto, 2003; Bell and Park, 2006; Jordan et al., 2005). These writers provide
compelling empirical evidence to counter the idea that networks engaged in governing activity
operate regularly without some sort of input from government. Other writers point to the
complexities of new modes of governance operating in the shadow of hierarchy with government
exercising oversight in different sectors of EU decision-making, for example, in a variety of
ways and with different levels of control (Heritier and Lehmkuhl, 2008). Jordan et al. (2005)
approach the topic with care through a simple typology of governance forms based on the
selection of goals and means (see Table). Strong government would see strong steering of both
goals and selection of means by government. In contrast, strong governance would see
selforganising societal groups directing both goals and means. What Jordan et al. (2005:492)
found in their study of European environmental policy instruments in nine jurisdictions is that all
had, on balance, shifted from a position of ‗government‗ to one of ‗governance‗ with respect to
their
use of (environmental) policy instruments. However, the total distance travelled along the
continuum by the nine jurisdictions has been surprisingly modest. Furthermore, the overall
pattern of change ‗has been spatially, temporally and sectorally highly uneven‗. Very few cases
of the pure strong governance case were found to be present by Jordan et al. (2005) and although
there is only one study, in one policy area, their work is more than enough to create doubts over
any loose claims about governance without government.
All the major reviews of the governance literature including those by Pierre and Peters (2000),
Kettl (2002), Kjaer (2004) and Jacob and Sorensen (2007) agree that governance involves not
networks that are self-governing, standing free and alone but rather networks of organisations
that are guided and steered by government. In short, there are few analysts that seriously propose
that governance occurs without government, but there is a difference of emphasis between those
that see governance through the eyes of government steering, and those that see it in a less
structured way. The two perspectives are best seen as opposite sides of a coin rather than in
conflict with one another (cf. Pierre and Peters, 2005).
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Table: A simple typology of government and governance

Government
Society
determines
determines goals
goals
Government selects Strong
Hybrid
means government
Society selects means Hybrid Strong governance
Adapted from Jordan et al. (2005:484)
1.3 Public administration to Governance: A paradigm shift
A complex and more diverse set of organisational bodies and actors lie at the heart of public
administration as redefined by the governance perspective. While traditional public
administration concerned itself with the challenges of managing the political/ administrative
dichotomy in individual organisations and the making of policy, budget and practice within those
organisations; the governance perspective argues that it is the complex set of relationships
between the organisations and actors that also needs to be a focus of attention. The governance
perspective emphasises the idea that these organisations can no longer be linked together through
a simple hierarchical chain. Modern governing faces an extremely demanding set of power
dependencies (cf. Stoker, 1998). Power dependence implies that organisations committed to
collective action are dependent on other organisations and cannot command the response of each
other but rather have to rely on exchanging resources and negotiating common purposes. Thus
for example even a nation state, the most powerful of all actors in public administration, needs to
be able to operate at an international level and at the same time encourage action they favour at
the regional, local or neighbourhood level. In all of these settings they cannot command;
although especially within its boundaries they may be able to dominate the exchange. However,
even in these settings, the costs of seeking to impose control may be felt through the emergence
of malign unintended consequences or incapacity to achieve control except in a narrow range of
issues.
Interdependence means according to Salamon (2001:1611) the development of new tools of

governing and the recognition that success in public administration is achieved in new ways. He
argues that governments gain partners but lose direct control in the world of governance:
A variety of complex exchanges thus comes into existence between government agencies and a
wide variety of public and private institutions that are written into the operation of public
programs. In these circumstances, the traditional concerns of public administration with the
internal operations of public agencies – their personnel systems, budgetary procedures,
organizational structures, and institutional dynamics – have become far less central to program
success. At least as important have become the internal dynamics and external relationships of
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the host of third parties – local governments, hospitals, universities, clinics, community
development corporations, industrial corporations, landlords, commercial banks, and many more
– that now also share with public authorities the responsibility for public programs operations.
Moreover, the governance perspective tells political scientists more than ever before that
collective action intentions are not always matched by prescribed outcomes. Power
dependencies, and the opportunistic behaviour they allow, add to complexity and encourage
uncertainty of outcome. Governance implies a greater willingness to cope with uncertainty and
open-endedness on the part of policy-framers.
Government suggests an emphasis on certainty and proscribed and mandated outcomes;

governance instead draws much more attention to unintended consequences and outcomes.
Governing is concerned with the processes that create the conditions for ordered rule and
collective action within the public realm. The governance perspective challenges the dominant
Weberian-influenced perspective that rests on viewing governing as a tight cluster of connected
institutions. It offers a contrasting organising framework built around a wider, looser set of
organisation s joined through a complex mix of interdependencies. To understand the politics
and management of this world requires us to look beyond a tight core of institutions based
around bureaucracy and political parties and a limited elite form of democracy. Governance
frames issues by recognising the complex architecture of government. In practice there are many
centres and diverse links between many agencies of government at neighbourhood, local,
regional and national and supranational levels. In turn, each level has a diverse range of
horizontal relationships with other government agencies, privatised utilities, private companies,
voluntary organisations and interest groups. Moreover, whereas the Weberian model offers one
solution to the coordination challenge in a complex setting, the governance perspective
recognises there are at least four governing mechanisms beyond direct provision through a
bureaucracy. The bureaucratic form solves the problem of organising in a complex world by
dividing tasks into manageable parts and then connecting the actors responsible for individual
tasks through a hierarchical structure of command. Complex tasks of cooperation do not
necessarily always require the imposition of a hierarchical chain of command in an integrated
organisation. There are other options: regulation at arm‗s length, contracting through the market,
responding to interest articulation and developing bonds of loyalty or trust. Recognition of this
wider array of governance mechanisms enables the processes of modern governing to be better
understood.
Governing by regulation from a governance perspective is about one public organisation aiming
to shape the activities of another (Hood et al., 1998). It is oversight at arm‗s length, in that there
is not a direct or command relationship. Crucially the relationship rests on a level of legitimacy
for the regulator to act as an overseer. Regulation, however, is not through a Weberian
hierarchical chain of command but rather through a process of challenge and exchange. Hence,
what at first can appear to be a contradiction in governance, a growth in oversight by higher
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levels of government of lower governmental levels and various agencies, is best understood as
the rolling out of a governing technique in the context of complex architecture of governance.
Regulation can be a soft form of governance where the regulated agency or organisation is not
commanded to do something but acts with autonomy, within prescribed limits, and is held to
account against the achievement of certain goals or outcomes.
A second coordinating mechanism is provided by the market and associated incentives (Savas,
2000). The coordination task of achieving a complex activity is achieved through the invisible
hand of appropriate incentives being provided to individuals so that their self-interested
behaviour contributes to collective goals. Market or quasi-market mechanisms provide a
common way of achieving the appropriate incentives. A government agency under such a
mechanism retains the role of arranger but the responsibility for producing the service rests
within another agency that ‗earns‗ the right to do so through competition. Introducing
competition is vital and requires a conscious governance strategy to create the conditions in
favour of a market-like system. Options may take a wide variety of forms from the familiar
contract with a private or voluntary sector producer to ‗market-like‗ competition between public
sector producers. The government agency achieves effective coordination through the
specification of the service, the selection of the best producer and by monitoring and oversight of
their performance. The presence of competition both keeps the performance of producers up to
scratch and encourages innovation among producers as they seek to sustain or enhance their
position in the market.
A third coordinating mechanism is that provided by interest articulation most of which takes
place through policy networks that provide the crucial framework for including in some interests
and excluding others. As Rhodes (1997a:9) comments: Policy networks matter: they are not an
example of otiose social science jargon. All governments confront a variety of interests.
Aggregation of those interests is a functional necessity. Intermediation is a fact of everyday life
in government. Rhodes goes on to identify a variety of different forms of policy network, some
of which are more closed than others. All provide a way of bringing together interests that are
central to the process of governing. By including these interests, by negotiating with them and
understanding their positions governments then have a better chance that policy, once adopted,
will have the desired effect because it has had the engagement and support of these interests.
1.4 Governance and Interaction
Our line of argument sees governance as a societal quality made up of public as well as private
'governors', hence the term social-political. The essence of the argument is that governance of
and in modern societies is a mix of all kinds of governing efforts by all manner of social-political
actors, public as well as private; occurring between them at different levels, in different
governance modes and orders. These mixes are societal 'responses' to persistent and changing
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governing 'demands', set against ever growing societal diversity, dynamics and complexity.
Governing issues generally are not just public or private, they are frequently shared, and
governing activity at all levels (from local to supra-national) is becoming diffused over various
societal actors whose relationships with each other are constantly changing. There has, judged
against traditional public governing activities, been an increase in the role of government as
facilitator and as co-operating partner. As such it is more appropriate to speak of shifting than of
shrinking roles of the state. However, a reshuffling of government tasks and a greater awareness
of the need to interact with other societal actors does not render traditional government
interventions obsolete. It merely implies a growing awareness of the limitations of traditional
governance by the state on its own.
In diverse, dynamic and complex areas of societal activity no single governing agency is able to
realise legitimate and effective governing by itself. Such governance is achieved by the creation
of interactive, social-political structures and processes stimulating communication between
actors involved, and the creation of common responsibilities next to individual and separate
ones. There is a need to restructure governing responsibilities, tasks and activities, based upon
differentiation and integration of various concerns and the agents representing them.
An interaction can be considered as a mutually influencing relation between two or more actors
or entities. For the purpose of our discussion, these interactions are considered as predominantly
between human actors with social-political governing roles, but interactions between man and
nature, as in the exploitation of natural resources, are also relevant in governing terms.
The interaction concept has a central place in the governance perspective. Governance issues
arise in interactions between 'the' political and 'the' social, and are also handled in governing
interactions. These terms refer to the multi-lateral relations between social and political actors
and entities (individuals, organisations, institutions).In the governance perspective it is assumed
that governing interactions also have to be reflected in its conceptualisation.
The governance approach also assumes that many of these interrelations are based on the
recognition of inter-dependencies. No single actor, public or private, has the knowledge and
information required to solve complex, dynamic and diversified societal challenges; no
governing actor has an overview sufficient to make the necessary instruments effective; no single
actor has sufficient action potential to dominate unilaterally.
Governing and governance: 'social-political' or 'interactive' governing or simply governing

can be considered as the totality of interactions, in which public as well as private actors
participate, aimed at solving societal problems or creating societal opportunities; attending to
the institutions as contexts for these governing interactions; and establishing a normative
foundation for all those activities. Governance can be seen as the totality of theoretical
conceptions on governing.
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Interaction as an analytical concept: The intentional Vs structural level interactions the

intentional or actor level of interactions
Jan Kooiman (2003) employed inter-actor theory to analyze actors and their intention in
governing interaction. The basic unit of analysis in inter-actor theory is an 'actor-in-situation'.
Situations can generate, define, and determine the course of an interaction process, but actors in
inter-actor situations also have the capacity to control some of the variation in their own actions.
In governing interactions individual citizens can be the focus of analysis. However, more
common will be governing situations, where the actor is not simply an individual, but is better
seen as a 'corporate actor'. Mayntz, for instance, speaks of interacting organisations, of those who
represent or can commit an organisation, as being corporate actors? Corporate actors usually
have a broad array of resources at their disposal, at the same time they are often constrained in
the scope of their interactions, exactly because they represent organisations. Actors will usually
be identifiable by their varying capacities and the roles they play: actors as individuals, actors as
corporate representatives, or actors as governing entities – such as states.
Action implies intention, which relates to consciousness and identity. We see a constant
oscillation between the need for predictability to keep interactions going, by reinforcing identity
both at the individual and collective level, and indeterminacy due to the complexity of governing
experiences and a necessary adaptation to the ever-changing conditions of the natural and social
environment of these interactions. Role theory may help in analysing such difficulties not only in
oscillations between identity (predictability) and experience (complexity), but also between
tensions within other role expectations in governing interactions at their intentional level.
At the intentional level of governing interactions issues such as goals, interests and purposes of
individual or corporate actors are at stake. However, individual, organisational, or group goal
oriented interactions can be non-goal-oriented in their consequences. Such unintended effects
will often be the result of (systems) complexity and dynamics of governing situations at hand,
assuming processes to be linear when in fact they are non-linear. Effects such as these abound in
all governing interactions, making them both more complex than many of the rational models of
political interaction, and more realistic and rich in content. The same applies to the often
supposed unity of actors or entities in governing interactions, as in interactive game theories,
where whole states are considered to be unitary 'actors'.
Unintended as well as intended consequences are inherent in governing interactions due to

tensions within and between roles of actors involved and situational factors.
The structural level of interactions
Intentional interactions do not take place in a void; they are always contextually situated. This is
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what we call the structural dimension of interactions. Structure is a concept used by many, but
defining it is not an easy matter. The answer for the question- or ‗why things don't fall down or
apart' – can give insight into its meaning. Therefore, the structural element in governing
interactions are the stable and enduring patterns, contexts or conditions ensuring that they don't
'fall down or apart'. The structural dimension of governing interactions point to the material,
social and cultural contexts in which interactions come about and into effect. It consists of those
circumstances that limit, broaden and at the same time condition its intentional level: institutions,
general social constructs, patterns of communication, material and technological possibilities and
societal power distributions. This makes for a potentially great choice of factors that can be
considered relevant, in that structural dimensions in a particular interactive governing situation
are a question of purpose and taste. Determining this purpose and taste is one of the major
objectives of the governance perspective.
Governing actors will consider the structural components of the interactions they participate in
as relatively constant/predictable in the short term, while in the long term they will see them as
changeable, partly due to their own activities in them.
Relations between actor and structure in interactions
Through their interactions, governing actors structure and restructure the systems they are part
of, and in doing so they also influence social developments. The structural aspect of
socialpolitical interactions refers to the cultural, material and power conditions that constrain and
enable the intentional or actor level of these interactions. Although structures always both
constrain and enable in time and space, they are beyond the control of any individual actors.
However, structuration theory stresses that broader structural contexts shape individual action,
but also argues that these actions in turn shape structure in an interactive and recursive way.
Varieties of societal interactions
In modem society, not only an enormous variety of interactions can be observed; a striking
phenomenon, from a governance perspective, is that much societal governance takes place 'by
itself'. This is fortunate: if this were not the case, the fundamental freedom to establish patterns
of social and social-political interactions would be immensely restricted. However, there are also
formal modes of interactions, mediated by official rules and regulations, with positive or
negative provisos attached. Governments are often involved in these forms of interactions, but
not exclusively: in the professions and the business world much interaction is formalised and
sometimes backed up by rules and regulations - sometimes with official status but this is hardly a
hard and fast rule. Also, all around us the buildup and growth of networks of private, semiprivate
and public organisations occurs. Networks and networking are among the 'buzzwords' of
our time. For good reason modem societies could be labelled as 'interorganised societies', anyone
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familiar with workplaces like universities and hospitals, but also banks and governmental
bureaus, will be aware that within them exist all kinds of interactions: unofficial and freely
organised ones, semi-organised and semi formalised ones, and finally those one finds on
organisation charts.
These observations alert us to different forms of societal interactions. The choice of how to
ascertain varieties of interactions is a conceptual one, although distinctions also serve analytical
purposes in reducing the complexity of what can be found in the field of social-political
interactions.
To comprehend governance issues in modern societies, the division of societal interactions in
different types (interferences, interplays and interventions) is a major analytical tool.
Interferences: Interferences can be seen as the interactions forming the 'primary' societal
processes: to maintain a family, take care of the sick, produce or sell a product, teach a school
class, play in a string quartet. The form and substance of these activities are in principle
unlimited, and this principle also applies to the interactions in and around them. Technical,
economic, social and cultural primary processes each have their particular style of direct
interferences around them. One can systematically scrutinise such processes and generalise their
characteristics into a feasible number of interferences and find out how these are distributed
across or between societies.
Alternatively, you could start at the other end and differentiate societal domains such as state,
market and civil society according to the occurrence of this form of interactions. Although
interferential interactions are basically the least organised kind of societal interactions, they also
occur in quite formalised work processes such as in banks, public administration, or the
judiciary. Patterns can be determined in the varying degrees interferences are deployed as
societal interactions and the way they are structurally used as societal media. Comparing them
(sub) sector by (sub) sector can contribute to our knowledge of the structural conditions and
cultural traditions of primary interactional processes.
Interplays: Interplays can be considered as interactions with a typical 'horizontal' character. In

principle there is no formal authority, domination or subordination within them. Interplays aim to
reach goals by engaging actors in collective, rather than independent action, and on a generally
equal basis. Although interplays can be found within organisations, from a social-political
governance point of view, interplays between organisations require attention. The importance of
interplays as forms of interaction can be attributed to the growing specialisation and
differentiation of modem societies on the one hand and the need for inter-relations to counter
these tendencies on the other. These tendencies occur in all societal sectors and levels, a fact of
which Durkheim expounded upon. For governance, individuals interacting in interplays are
interesting, but horizontal interactions between groups, organisations and other entities are more
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important. In these interplays, tensions between striving for individual and collective interests,
always present in interactions, relate mainly to differences in organisational goals.
Interventions: Interventions are the most formalised kind of societal interactions. They are
interactions aimed at directed exertion of formalised influence, often with provisos attached.
Interventions can be found in all sectors of societies, although public ones are the most
conspicuous. A relatively simple way of conceptualising interventions is to take formal rules as
the starting point. This not only refers to public rules, which are surrounded by, and based upon,
carefully defined sets of procedures, usually expressed as rules themselves, but also to many of
the interventionist kinds of interactions within and around private organisations, for instance
those formalised in bylaws, instructions and formal procedures. They only bind those who
explicitly agree to be bound by them, who thus accept these interventions in their behaviour,
either individually or as a collective.
Interaction means a mutual relationship where entities influence each other. Thus, intervention as
a type of interaction implies that both the intervening actor and the object of intervention
influence each other.
The relation between the structural level and the application of concrete interventions at the
intentional level, become more apparent in interventions than in either interferences or
interplays. Not only do actual interventions usually have a formal nature, such as rules and
regulations, but also at a structural level, authorities are allowed to introduce and implement
interventions. Indeed the relation between the two levels exists through sets of formal rules and
regulations: 'rules to make and execute rules'. This is the consequence of the formalised character
of interventions, and the guarantees surrounding them.
Types of interactions and modes of governance
Not only do these three types of interactions have a descriptive value in reducing the complexity
of societal interactions, distinguishing them also has a two-fold analytical function: they can
serve as a basis for defining differences between the societal institutions of state, market and
civil society, and they can help in formulating qualities of variance between modes of
governance.
We can say that in the state, the market and in civil society domains all three types of
interactions can be found, but not in the same manifestations, proportions or mixes. So for
instance in the state domain we find high proportions of highly formalised interventions, but an
abundance of interplays and interferences are also apparent to a lesser degree. In the market
domain the most common interaction will be interplay, although there is no lack of interventions
as well, while interferences are also quite common. In civil society interventionist interactions
are the least likely, and interferences and interplays dominate; interventions occur, but relatively
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rarely.
The distinction between the three types of interactions is also important in relation to modes of
governance: interferences to self-governance, interplays to co-governance, and interventions to
hierarchical governance. They are the object of governing, but at the same time can be seen as
forms of governance themselves; an interplay in a work situation is a form of work organisation
that thus governs the activities of the workers. At the same time, probably at another level in the
organisation and by means of co-governance, 'interplay as structure', and 'work-interplays' can be
influenced. The same might happen at still another governance level, where interplays between
representatives of trade unions and employers in a co-governance mode might result in
'horizontal' general agreements on how to co-govern interplays in the workplace. The exercise
works equally when applied to interferences and interventions. This sounds complicated, but for
a proper analysis of social political governance these 'layered' forms and interactions and modes
of governance are not only facts of life, but analytical tools that cannot be neglected.
The dual character of the interaction concept itself, with its distinction between an intentional
and a structural level, might also assist us. Intentional interactions do not take place in a void, but
within their particular contexts or structures. This dualistic element of social-political
interactions is also relevant when applied to the three disaggregated forms of them. The
intentional level of interferences as the least organised dimension of societal interactions matches
its structural dimension of governance, of self-governance. The same can be said for the
intentional level of interplays: these forms of (highly) organised societal interactions – either in,
or between, the market, the state or civil society - can be viewed from their structural features;
this structural dimension of interplays will be called 'co'-governance. Finally, in the state domain
we find highly formalised interventionist interactions (found also in the market). Following the
above line of reasoning this structural angle on interventions will be designated as the
hierarchical mode of governance.
Governing actors have a choice of different types of interactions to participate in at the

intentional level of governing interactions; by doing so they explicitly or implicitly
contribute to the structural features of these types of interactions as modes of governance.
1.4 Modes and orders of Governance Modes of Governance Self-governance
Self-governance, as one of the three modes of societal governance, is the capacity of societal
entities to provide the necessary means to develop and maintain their own identity, and thus
show a relatively high degree of social-political autonomy. Societies differ in the way
selfgovernance is practised. Interest in self-governance as a mode of societal governance is in
line
with trends of withdrawing public interventions by means of deregulation or privatisation.
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However, much of what is sold as deregulation or advertised as self-regulation is better seen

as forms of re-regulation or altering traditional forms of public control into 'steering at a
distance'. From this perspective it seems doubtful these governing tendencies can seriously
be labeled self-governance.
Some theoretical positions Self-governance as autopoiesis
A good start for thinking about self-governance is the concept of autopoiesis, literally
meaning self-production. Autopoiesis, as developed by the biologists Maturana and Varela, is
a concept developed to better understand 'living systems', not as the reproduction of parts,
such as lungs or nerves, but as systems of interactions of components, as living wholes.
Through internal, coherent interactions, autopoietic systems reproduce their own identity,
without being dependent on the environment for this reproduction, except for the supply of
energy and other material needs. By definition an autopoietic system is autonomous.
Though the application of autopoiesis in social science fields is debated, Niklas Luhmann,
built a whole theory of social systems around it, also using the concept of self-referentiality,
connected to autopoiesis. Communications, not actors, are the essence of the self
referentiality of social systems, because communication can exist and reproduce itself,
independent of actors. By means of communication, systems 'decide' self-referentially what
is relevant to them, what conveys meaning to them, and what does not. How then to govern
autopoietic social systems, as economics or law, from the outside? In the functional
differentiation of modern societies, the political system is no more than a societal sub-system
like any other, according to Luhmann. It has its own functional code, making it sensitive to
signals from outside, enabling it to act as an autopoietic system by itself. This special code
for the political system is power: by communicating power it is able to incorporate other
societal subsystems in its communication. However, being a subsystem like any other, the
political system has no special – hierarchical
position in relation to other societal subsystems. For the political system this equality is
problematic, because it is required to take decisions binding society as a whole. The political
system can exempt itself by defining itself as 'the state', and in so doing creating a special
governing role, at least for itself, according to Luhmann. The consequence of this autopoietic
thinking about Politische Steuerung is a pessimistic view of the possibilities of governance in
modern societies. Some of Luhmann's followers, although accepting the basic autopoietic
principle, are trying to relax the strictness of his message. An example of this is Teubner's
theory
of reflexive law, which I will discuss shortly.
Like all social systems (systems of) governing interactions will demonstrate self-
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governing (autopoietic) attributes because of a strive for self-identity; the stronger these
attributes are, the more difficult to govern them from the outside.
Self-governance as actor constellations
The actor-oriented approach to self-governance that has Renate Mayntz and Frits Scharpf as key
proponents is partly a reaction against Luhmann's pessimistic view in the German debate on
Politische Steuerung? The essence of their argument is that there is nothing systemic to
difficulties in Politische Steuerung but that these are the consequence of special features in
actorrelated self-governing situations. The dynamics of modern societies are an important
explaining factor in such situations.
To underline the actor as opposed to the system approach, the contexts in which governing actors
operate are conceptualised as constellations, hence the term actor-in-constellation used in this
approach to self-govenance. For actors they use the term corporate actors, who represent
organisations or interests in these constellations.
In the actor-in-constellation perspective on self-governance analysis focuses on the dynamic

processes that occur in the mutual stimulation between identifiable actors in reinforcing,
nonlinear behavioural patterns. The effects of these dynamic processes can be seen in terms of
their
growing autonomy and towards dispositions of self-governance. The actor oriented school
concerns itself only with self-governing tendencies exhibited by societal sectors that are
intervention resistant. The degree to which such self-governing tendencies can be observed
depends, in their view, on a number of independent and varying factors, found on the side of the
sectors themselves, as objects of external influence, as well as on the part of authorities wishing
to intervene.
On the side of sectors in the governing interaction the 'primary process' of a sector is of
importance. The difficulty or ease with which services or products can be replaced is an issue:
the more difficult their substitution, the higher will be tendencies for self-governance, and vice
versa. Resisting or supporting governing intentions is also a matter of contingency: are these
intentions congruent with those of the subjects they are aimed at or not? If there is a discrepancy
between them, the larger the discrepancy, the more difficult will external governance be
achieved. Organisational capacity of social sectors is probably the most important variable in the
way they are internally governed. Mayntz hypothesises that with the institutional consolidation
of societal sectors, especially with the emergence of multi-level structures including governing
entities of a higher order (umbrella organisations, and peak associations), their ability to
selfgovern increases. The scope of their organisational capacity is important. On the one hand a
large organisational capacity might aid external interventions, but it also might be a barrier
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towards such interventions. Self-governance does not necessarily diminish political

governability, it can enhance it. The effective organisation of sector interests can be used as a
veto power to block solutions to societal problems. It can also mean that consensus between
corporate actors can be reached and decisions taken to solve a particular societal problem,
exactly because there is a high level of self-governing capacity in a sector. A simple inversion,
then, of the general thesis that highly organised subjects will resist governing attempts more
adamantly, would be as wrong as the thesis itself.
On the side of intervening political-administrative authorities several factors can be mentioned

that are relevant to the relative success or failure in governing societal sectors. A political
condition requires that governing needs be articulated, because if a governing activity is initiated
by pressure from an interest group, autonomic tendencies will be promoted. The same occurs
when the state lacks legitimacy to intervene in a sector; there is an availability of governing
instruments and the question is of whether these instruments can be implemented. If a sector is
highly dependent on public finances and the knowledge required to ntervene in them, the use of
governing instruments may be effective in curbing self-governing tendencies. This last element,
required knowledge, is also mentioned by systems theorists. When corporate actors, both the
governing and the governed, coalesce, governance becomes complicated. This happens when
private corporate actors combine forces with fragmented political administrative authorities to
pursue their own interests. At such points actor constellations may arise in the form of networks,
in which state and corporate actors participate, often with cross-alliances between them. In these
networks, the distinction between governing object and subject becomes practically impossible
to define. In such situations, these networks become basically self-governing units par
excellence. However, not all policy sectors are characterised by more or less well-organised
subsystems. Compared to the relatively tightly coupled neo-corporatist structures, the consensus
and decision-making capacity of policy fields characterised by open and fragmented 'issue
networks' are less developed, although even there some large organisations may assert
themselves as corporate actors. In the view then of Mayntz and her colleagues the question of the
(un-) governability of a societal subject is an empirical one. The actor-in-constellation theory of
self-governance reasons that the indisputable governability problems of complex and dynamic
modern societies has less to do with the basic autopoietic character of social subsystems, than
with (1) their dynamics resulting in self-governing capacities; (2) the organisational and other
abilities of organised policy fields to resist political governance; and (3) the political will and
administrative competencies to intervene and govern. Under specific conditions the very capacity
of societal actors to act in an organised way can hamper as well as facilitate governance in
solving problems originating from societal dynamics and complexity.
Wherever (corporate) governing actors, representing different societal domains, are able to
organise networks in which they combine resources from those domains for common
purposes, these networks will show strong self-governing tendencies.
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Self-governance as patterns of interaction
Jan Kooiman (2003) believes the most spontaneous forms of societal interactions are
interferences. Interferences can be found everywhere in societies. They are interactions taking
place within and around 'primary' societal activities such as welfare, care and education, but also
with the production and distribution of commercial goods and services. The issue under
discussion now is the relation, or the embeddedness, between interferences and self-governance.
Thus self-governance as a mode of governing interactions are embedded in the sphere of societal
interferences. We find self-governance most often in the civil society domain, somewhat less in
the market, and least frequently within the state. Although interferences have a somewhat fluid
and relatively unorganised character, even the market and the state cannot do without them as a
mechanism for ordering informal personal traffic between actors in these domains. What must be
demonstrated, is how self-governing as a major mode of governance fits with this broader
category of interferences. Can something more specific be said about this embedding in
analytical terms?
To do this, we return to the general interaction concept, with its intentional and structural aspect
and the relation between these two. The intentional level of these interactions is the reservoir
from which self-governing activities are drawn. If there is a wish on the part of those involved in
these spontaneous and relatively little organised forms of interactions to continue them, they will
start experimenting with and designing governing arrangements for them. These can take the
form, of informal agreements, self-applying rules, and also semi-formalised codes of conduct.
The essence of these arrangements is their voluntarism and consent, and as such they are the
nucleus of self-governance, looked at from a structural point of view. However, the relation
between these agreements, rules and codes, to arrangements of a more structural nature, is a
subtle one. At the organisational level it has been shown that to run a national voluntary
organisation of some size with many local chapters, traditional 'top down' management concepts
are ineffective. Rather, models built to exploit interferences and interplays, do a much better job
in the self-governance of such organisations. This could be due to the nature of civil society, the
domain such organisations belong to. It is in the domain of civil society where interferences
dominate, where potentialities have been internalised and limits to self-governance set. When
speaking about institutions, there is the mimesis effect: organisations learn from each other how
to govern themselves, and these patterns become generalised and even institutionalised.
For social-political governance, empirically, every level of interrelation between interferential
interactions and or self-governance structures are of interest: from self-governing roles,
organisations, sectors, societies, to a self-governing 'world community'. At all these levels one
can look at the ways structural embedding of interferences unfold, or conversely how structures
of self-governance trickle down into more widespread interferences. This, as has been discussed,
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may have happened within the state. In the past decade we have seen a changing role conception
of (higher) civil servants: from 'public administrators' to 'public entrepreneurs' (intentional
aspect). This is influenced by the general introduction of market mechanisms to the state
(structural aspect).
Therefore, structural developments including 'inter-penetration' of market
traits in the public domain have an effect on the role conceptions of actors on the intentional
level of their interactions, and these in tum may have an effect on the overall management of the
state. Also, in the market place examples of self-governance developed on the basis of
interferential societal interactions can be found, of loosely organised interactions between
multinational firms and environmental organisations resulting in the formulation of voluntary
codes of conduct in areas of environmental awareness. However, the incidental nature of the
introduction of such codes shows that inter-penetration has not yet taken place on the structural
levet in contrast with the state where management-type interactions have materialised at the
intentional as well as the structural level of governing interactions, and in the relation between
these levels.
Only by taking the basic aspects of societal interferences seriously can the self-governing
societal capacity be fully appreciated and structurally used for governing purposes.
Self-governance in societal fields
Societal governance in modem societies is a mix of different governance modes. Therefore

governance mode by itself is a partial one, completed with other types. This applies to
selfgovernance as well as to co- and hierarchical modes of governance. As was evident in the
example above, a basic issue in governance of the professions is exactly this mix, in that example
between self- and hierarchical governance. The question now is of which perspective this
relation between or mix of different modes of governance should be applied. Does one consider
rules and regulations and other hierarchical governing instruments as the main way of
governance, and other categories such as self-governing - to put it somewhat bluntly - as a
marginal society category? Or does one see self-governance as a societal capacity, having
governing qualities of its own, and deserving a place of its own in a governance mix? This is an
important point, not because the latter view would be typically 'liberal' and the former typically
'socialist', but because the discussion on modes of governance so easily becomes an instrumental
one, where one type of instrument is exchanged for another, as in the discussion on
selfregulation or deregulation. What is required is a fundamental debate on the capacities and
qualities of the different governance modes, what the boundaries of such capacities and qualities
are, and the way these capacities and qualities can be deployed for broader societal governance
purposes. Let snow examine the relation between self-governance and concepts such as de-,
reand self- regulation.
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In the last few decades many governments have started to shed many rules and regulations, to
simplify them, and to do something about the accumulation of them. What concepts such as
deregulation, self-regulation, re-regulation or conditioned self-regulation mean, what their
relations are, and what relative benefits each offers is far from clear. Self-regulation is seen as an
accompaniment of deregulation. However, the automatism of less governmental regulation and
more self-regulation is not as natural as it might seem. Debate on the issue reveals a balancing
act: deregulation is a withdrawing of the public sector; this withdrawal automatically implies an
increasing degree of self-regulation on the part of those concerned. The supposition and, at the
same time, effect of this point of view is that self-regulation is seen as an instrument in the hands
of the state: it is an instrument that the state can, if it chooses to, bestow. The implication is that
the market or other sectors of society do not govern themselves unless the government allows
them to do so. Self-regulation becomes a form of interventionist governing - albeit a weak one.
In other words: self-regulation as one of the tools in the toolbox of government. This is an
opinion adhered to in legal circles, however in public administration there is a tendency to see
self-regulation as a phenomenon in its own right, separate from government. Where
selfregulation for administrative scientists is a possibility to break through the, in their view,
obsolete central rule paradigm, self-regulation for legislative scholars is an instrument that can
enhance the legitimacy of public action. In this perspective self-regulation is not so much the
strengthening of the self-steering capacity of society, but the search for new instruments of
government policy.
A retreating government does not intend by it to lose part of its domain, but rather to create
conditions, follow and adjust their interactions with societal sectors, instead of intervening
directly. A deregulating government remains the body responsible for the effects of its own
deregulating and thus for the self-regulating operations of societal fields. This short discussion
demonstrates that even though the words used are the same, their background and meaning are
quite different. They are two, quite different, approaches to the way dilemmas of modern
governance can be conceptualised. This reflection on deregulation and self-regulation demands
conceptualisation and a clarification of their relation to self-governance.
Self-organising, self-steering or self governing are, in the governance perspective, not capacities
or qualities created by governments, they are instead societal phenomena, existing elements of
social reality that governments and others need to take into account. Self-governing as the
formulation and implementation of rules by societal actors themselves, as in the example of the
governing of the commons, should be considered as a mode of self-governance as a matter of
definition or even principle.
Recognition, stimulation and possibly adjustment to such forms of self-governance can be
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considered as part of a mix of governing alternatives. Equating self-governing with

selfregulation as described above narrows the discussion on what self-governance in modern
societies might mean, as a consequence an opportunity is missed to explore and find out what
self-governing qualities of societal sectors or other societal entities are, next to or in place of the
more official forms of self-regulation. However it is the different approach rather than the
different wording that is essential here: either 'self-governance' is considered an officially
granted 'favour' or it is an inherent societal quality with or without official approval.
In the self-regulation option the task is of improving failing hierarchical modes of governance by
replacing one form of governing for another type, hoping that it might do better. In the
governance perspective selfgovernance is considered a societal quality to be employed more
widely and systematically, and by doing so the governing failures as mentioned might be
avoided or approached from another angle. This is what concerns all three theoretical notions on
self-governance, the autopoietic, the actor constellations and the interactive governance
aprroach: the strong doubts about the effectiveness of large-scale direct intervention by
governments.
Self-governance is an inherent capacity of societal entities at the actor level of governing

interactions, and not to be mixed up with de- or re-regulation; at a structural level external
influence can be exerted to enable or control such capacities.
'Co·' governance
Co-governance as a mode of governance deserves special attention because co-governance in its

varying appearances may be an answer, a reaction to or an expression of a major societal
development, the tendency toward growing societal interdependence and inter-penetration. These
are assumed to be related to the (growing) diversity, dynamics and complexity of modern
societies and the governance issues these tendencies bring about. Co-governance means utilising
organised forms of interactions for governing purposes. In social-political governing, these are
key forms of 'horizontal' governing: actors communicate, collaborate or co-operate without a
central or dominating governing actor as can be witnessed in the more general cetegory of
societal interplays. It is especially these forms of governing that are considered to be
wellequipped modes of governance in diverse, dynamic and complex situations, but certainly not
exclusively so. Societal forms of cogoverning are embedded within these interplay forms of
societal interactions.
Collaboration and co-operation
Collaboration and Co-operation may seem to be two words for the same thing, but it is important
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to differentiate the two. Collaboration is the less formal of the two and co-operation the more
formal.
Collaboration
Collaborating is difficult, nevertheless it happens all the time, because it is considered to be a
valuable way of tackling social-political challenges, for instance at the community level between
public and private partners. Doing things together in an organisation, and in particular
interorganisationally, is what we mean by social-political collaboration. Such collaborations are
interesting because they are a microcosm of the broader social-political world with all its
complexity, dynamics and diversity. They are not only part of this world, but in a way also
represent the social political world in their efforts of governing together, instead of doing things
alone.
The diversity of the governing world is represented in differences in aims and inputs, in language
and culture, and in perceived power. The diversity of aims aspired to by those co-interacting is
not only to be found across the table in the various interests of those collaborating within the
confines of an agreed-upon mission or strategy. Those participating often also have hidden
agendas, which may be of a private nature, but also driven by organisational aspirations. The
variety of inputs obvious or hidden is certainly an important aspect of all collaborations, creating
the possibility of synergetic effects. Perhaps without a certain diversity of means brought into a
collective effort, there is not much sense in collaborating at all. In regard of civil servants,
members of voluntary organisations, professionals and even businessmen collaborating, it is
logical that the diversity in individual history, knowledge and experience will themselves be the
source of 'collaborative advantage'. However, different customs and even language coupled with
unique backgrounds may also present a stumbling block in the way things work out in a
collaboration.
Further, diversity in power is a recognised issue in collaboration: too much difference is usually
considered a problem and is often a cause of anxiety among participants; on the other hand, too
much equality in power may hamper the instigation of initiatives or developing leadership.
Collaborations also can be seen as being complex in membership and in tasks. It is not
uncommon for collaborations to exist between individual members, members representing an
organisation, members representing an umbrella of organisations or even collaboration itself.
So what is membership and what does representation mean? Who is accountable to whom for
what the collaboration stands for? Often, tasks require varying forms of interactions between
members in diverging roles and overlapping functions, depending on layers of working relations
and mandates accorded to members. All this results in ambiguity, which shouldn't always be
considered a negative quality of collaborations. Such vagueness may create space for members to
contribute in varying ways, and involve themselves to an extent that otherwise might have been
impossible.
Finally, there are tensions and changes within collaborations giving them their specific
dynamics, they are seldom static. Internal as well as external influences add to such tensions, and
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affect membership and even purpose of a collaboration. Membership in collaboration often

changes rapidly: organisations may come and go as well as their representatives.
Often, personal commitments varying in time due to other obligations, are of greater importance
than official membership. Such changes can have severe consequences for subtle balances
reached, and even have an effect on what the collective effort is about, even in terms of goals
pursued. Here Huxham speaks of 'domain shifts': a cyclical relation of participants defining the
focus of a collaboration, and focus defining may mean new participants.
Collaboration is a higly diverse. volatile and complex form of co-governing arrangement. It

represents. in a direct way. societal diversity. dynamics and complexity in governance. and by
doing so illustrates many co-governance issues.
Co-operation
Influential in conceptualising co-operation are the efforts by game theorists to develop theories
of co-operation in situations of a prisoners' dilemma. Game theories of co-operation between
states in international relations have been widely used and tested, with results also potentially
applicable in other governance arenas. An example of this is what is called 'achieving
cooperation under anarchy'. Anarchy refers here to situations lacking common authority, but not
denying structured interactions. Three dimensions help to understand the propensity of actors to
co-operate in such situations: mutual interest, the shadow of the future and the number of
actors. The analysis of benefits to be reaped shows that a short-sighted pursuit of self-interest in
such situations can be disastrous. Both sides can potentially benefit from co-operation - if they
know how to achieve it.
Concern about the future helps to promote: co-operation long term horizons, regularity of stakes,
reliability of information about the other's action and quick feedback about changes in the other's
actions. The number of actors is also an issue, the main one being the possibility of defection:
the larger the number of interacting actors in this 'anarchy', the greater the chance of defection.
The effect of a heterogeneity of actors co-operating in solving collective-action problem
situations also have been studied systematically. Three dimensions of heterogeneity have been
distinguished: in capabilities, in preferences and in the heterogeneity of information and beliefs.
Results of analysis are ambiguous: heterogeneity of actors can facilitate or hinder co-operation,
depending on the type of heterogeneity and the context. The concentration of capabilities in a
few actors may facilitate co-operation between them, but only if these actors benefit significantly
from such co-operation. Heterogeneity of preferences can lead to gains from exchange, resulting
in more co-operation. Conversely, heterogeneous private information can be a great hindrance to
negotiated agreements. It also seems that the nature of institutions affects heterogeneity, and vice
versa.
Governing actors will co-operate under conditions involving mutual interests, limited
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numbers, and common concern about the future, and will provide the necessary institutions,
in the shape of self-enforcing agreements based upon principles of reciprocity.
Varieties of 'co-modes'
In this section a number of major manifestations of co-governance are introduced.
Communicative governance
New patterns of governance are addressed to stimulate learning processes, leading to cooperative
behaviour and mutual adjustment, in order that responsibility for managing change is
shared by all or most involved actors? One such alternative form is communicative governance.
In this type of governance a form of rationality is assumed, that considers social actors to be
'Reasonable citizens': This call upon the 'reasonable citizen' corresponds with Habermas' concept
of communicative rationality, often appropriate for complex problem-solving as a substitute for
instrumental, functional or strategic forms of rationality. The concept of communicative
rationality is based on the idea that in interaction (temporary) actors can reach inter-subjective
understanding. The authority is the 'good argument', related to empirical as well as to normative
judgements. Although communicative rationality in the reality of governing is not easy to realise,
it seems there are ways of practising it: 'increasing social complexity improves the chances of a
calculus rooted in self-interest, leading actors into communicative rationality'. Increasing social
complexity means increasing interdependence and increasing potential for positive-sum solutions
not obvious at first sight, but negotiable.
The prime reason for communicative governance is that for actors in the real world, faced with
complex, long term and ambiguous social-political problems, joint decision-making is more
adequate than traditional coordination by bureaucracy or the market. Communicative rationality
is 'translated' into governance, especially by public participation, and guarding the public nature
of the process enhances the legitimacy of its outcomes.
Communicative rationality in practice is pursued, not by making the dialogue 'power-neutral', but
by widening the process of governing. Results of communicative governing are expected to be
defensible from the point of view of public interest and not solely to satisfy the needs of the most
powerful actors. The involvement of interested actors is also expected to engender support for
and commitment to mutually agreed objectives. They must be 'condemned to co-operate', and as
a result communicative rationality can overcome pure political and economic reasoning.
Research on communicative governance suggests that this form of governing is feasable.
However, it is obvious that communicative governance is not suitable for problem-solving when
interests involved are sharply contradictory: then it will only lead to a delay of decision-making.
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Furthermore, interdependencies between interested actors may be expressed through harmful and
obstructive objectives being pursued to the detriment of others. When rewards for obstructive
behaviour are substantial, the search for consensus will be time-consuming. However, exchange
of information leads to greater understanding about problems and solutions and about one's own
and others' interests, improving chances for consensus. And finally analysis suggests not only the
involvement of direct interests, but also to encompass broader support for issues at hand. If
'interested third parties' only play a marginal role in communicative governance projects,
prospects for a broad acceptance of its results can be expected to be low.
Communicative governance suits governing situations where those involved in governing

interplays are willing to reach inter-subjective understanding for co-governing purposes.
Public-Private Partnerships (PPPs)
Public-private partnership (PPP) as a form of co-governance has been of great interest for some
years. Explanations given for their development cite pragmatism as well as ideology, or
combinations of these. The appreciation of governing in partnership cannot be separated from
changing views on the way public and private interact. In the 1970s relationships between state
and market were alienated and estranged, resulting, from the 1980s on, in a desire for certain
issues to be dealt with effectively by public and private parties jointly, rather than separately. In
the 1990s, due to both an effort to enhance the legitimacy of public actions and because of a
greater involvement of citizens and citizen groups, state and civil society began interacting more
systematically. Such interactions between public and private, expressed in concrete forms of
public-private collaboration or co-operation, are often referred to as PPPs. Their advent and
growth as a form of co-governance can be seen as 'an increase of the recognition by government
and the private sector of the necessity to channel, or even exploit, mutual interdependencies by
means of co-operation.
A relatively narrow but concrete form of PPP occurs when there is a financial-economic motive
for public-private co-operation. In such a PPP private capital is invested in (semi-) public
projects or programmes. In such cases the private sector may benefit from the removal of various
social, legal or administrative bottlenecks. Much broader are managerial strategic motives for
PPP. By entering into them, governments can make use of market know-how, expertise,
costawareness and other qualities present in the private sector. On the business side one finds
strategic motives such as establishing longer-term relations with the government for competitive
reasons, and to gain insight in the operation of public administration. PPP also can be part of a
strategy of corporate communication or social responsibility. For the voluntary sector PPPs as a
form of interaction with the government can be seen as a relatively normal phenomenon. Many
are active in fields that are also covered by public agencies and for them a prime motive will be
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to enhance their scope of activity, find legitimation for their activities and also find financial
support to develop and sustain their work.
For the (successful) functioning of PPP, the following conditions should be met. Trust is
important when entering into a co-operative relation such as a PPP, it brings about mutual
respect and adaptation, so oiling the wheels in the complex co-operation of a PPP. Common
objectives, the distinction of inputs, risks and returns, as well as the division of responsibilities
and authorities, should be fairly expressed. PPP, as a process, is subject to dynamics, e.g. with
regard to participants, power structures and rules of the game. It is therefore important that a
dispute regulation is embodied in a PPP agreement, which also defines conditions for changing
and, possibly, terminating the relationship. From the government's perspective, accountability is
a key issue in PPP. From the point of view of business partners, public bodies must take their
commercial orientation into account.
Many countries the world over have been the breeding ground for the political, managerial and
legal trials of a great variety of PPPs. Understanding the success and failure factors at the actor
level of these co-governing forms of social-political interaction is growing, but less is known
about the structural conditions under which they may come into being, flourish or die. The
increasing realisation of mutual interdependence in public and private circles has been an
important factor in the changing climate into one more favourable to PPP. How enduring this
realisation is, and how experiences with PPP will be influential in increased structural changes in
the relation between the state, market and – where the voluntary sector is involved - civil society
is still a moot question.
PPPs suit governing situations where public-private parties co-operate in governing interplays to
reach a win-win outcome, by exploiting mutually available resources.
Co-management
In the governance of natural resources such as forest, lakes, and coastal areas there is a tradition
in managing these resources, next to self-governing by users, in a co-governing way.
Comanagement, by definition, means that government agencies and users share responsibility for
the well-being of the resource, such as preventing depletion or illness. Co-management tries to
steer a middle course between government regulation and community-initiated regulation, as it
requires users to organise themselves formally. Organisation is participatory rather than
hierarchical, it is decentralised rather than centralised, and in my analysis typical interplay forms
of interaction take place among the actors.
Conseqently, co-management differs from regulation by government agencies, and also from
corporatist arrangements, although the line may be thin here. Co-management is more than
consultation, it involves a say in formal public decision-making, and the authority to make and
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implement regulations on its own. It is expected that by involving users of the resource directly
in its governance, the knowledge on which this is based is more adequate than would otherwise
be possible. This might in tum lead to more adequate governing measures, taking into account
particularities of local ecological and social governing situations. It is also expected that
governing measures taken in this way, will mean that users involved: 'willingly accept the
regulations as appropriate and consistent with their persisting values' and world views'. And
finally it is expected that if users accept governing measures as legitimate, they are more willing
to comply with them.
This set of expectations is the basic reasoning for those promoting comanagement as a form of
governance, especially for managing natural resources. Although participation of users in
governing the resource they live from and share is argued from the 'intrinsic complexity of the
task at hand, there may be differences of interest among them and between them and other users
of the resource, or between them and society at large. As such, interest is growing in looking for
institutional frameworks that go beyond inclusion only of users in co-management schemes, of
putting co-management in the perspective of a broader representation of interests. Therefore,
comanagement as a specific form of natural resource management is not only a technical issue
butalso a political one. The general idea behind pleas for co-management is to make users co
responsible for the sustainability of the natural resources they exploit. However, market parties
cannot be expected by themselves to set a process of modernisation of ecological processes by
themselves. The state is needed to initiate, stimulate, inform, formalise and now and then
enforce. This sharing of responsibilities between users and the state is exactly what
cogovernance is about.
Co-management suits governing situations where in governing interplays the inclusion of
knowledge of users (images) leads to more legitimate measures (instruments) and raising the
compliance to these measures (action).
Networks
'Networks' is one of the catchwords of the day, deployed for broad sketches using the concept for
an overall theory of society (Castells) to very detailed, precise and quantitative analyses of
particular types of multiple interactions in all societal domains. In network theory explanations
given for the rise and existence of networks are as a rule of a functional interdependent nature:
needs for resources, combatting common environmental uncertainties, strategic considerations
etc. Interactions in networks are mainly of a horizontal nature, although minor hierarchical
elements also can develop in networks, for example by linking-pin organisations. Next to
networks of firms, non-profit organisations or public agencies within their own societal domain,
are network developments between the societal domains, the market, civil society and the state,
as specimens of co-governing these are of special importance in the governance perspective.
Networks between state and market have been a source of intellectual curiosity and discussion
for quite some time. Network arrangements for policy purposes characterised them for a long
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time, but recently attention to their management has increased. Among network studies are
approaches with an emphasis on the actor or organisation level; these are supplemented with
studies looking at actor-structure qualities and one also can find studies theorising their structural
components. In these studies all kinds of labels or metaphors typify them: pressure
pluralism/competitive pluralism, state corporatism, group sub-government, corporate pluralism,
iron triangles, sector or meso-corporatism, issue networks, policy communities, negotiated
economy and others could be added.
Approaches to networks that explicitly conceptualise them as modes of governance, expressing

'new' government-society interactions, merit special attention. Several lines of thinking can be
noticed, of which three examples will be given: one from the UK; one from the Netherlands; and
one from Germany. In a UK analysis network development as a new governance mode is closely
linked to ideas about 'hollowing-out of the state', the argument being that, especially under the
influence of New Public Management, the state has become 'a collection of inter-organisational
networks made up of governmental and societal actors with no sovereign actor able to steer or
regulate'. In this perspective governance becomes more or less equalised with networks as a third
governing structure next to bureaucracy and the market.
The Dutch approach to managing networks, is linked to questions of governance. This network
perspective is a reaction to the rationalist central rule approach and to the multi-actor perspective
on governance. The central rule approach emphasises relations between a central ruler and target
groups. These relations are authoritative, and recommendations for governance involve
coordination and centralisation. In the multi-actor perspective again we find dimensions as
relations between a central ruler and local actors, but governance emphasis goes in the opposite
direction, and recommendations involve a retreat from central rule in favour of local actors. This
Dutch network perspective emphasises interdependent interactions between actors, in which
information resources and goals are exchanged.
Finally we have an example from Germany, that also considers networks singularly as a mode of
governance, and in some ways this is the most radical network view. Although different authors
give different accents, the common theme among them is that societal developments on the one
hand, and a shifting role of the state on the other, have located network formation on the
borderline between state and society to a new and specific governance mode. A participatory
drive from societal groups and interests resulting in strong promotional or blockage forces,
coupled with governments confronted with growing demands and diminishing
Steuerungscapacities, have made for a major shift . . . in societal governance from hierarchical
control to horizontal co-ordination, and networks play a crucial role in this co-ordination. This
form of coordination is not without problems, because co-operation between actors within
networks cannot be assured. Scharpf (1993), building on insights from bargaining theory, and
Marin (1990)
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drawing on exchange theory, have tried to make it plausible that such negative effects of
networks can be overcome.
There can be hardly any doubt that the emergence of mixed networks of public and private actors
is an important complement to or change of more traditional governance structures. How
fundamental one considers these occurrences to be, is partly a matter of theoretical orientation,
partly of personal judgement and taste. In the governance perspective mixed networks between
public and private parties are seen as an expression of interdependencies at the intentional level
of governing interactions within the context of inter-penetration tendencies between societal
sectors, including the public sector at the structural level of these. There is little doubt that
networks are a major form of governance dealing with societal complexity: in their plurality they
express societal diversity, and they can also be seen as a partial answer to the dynamics of
modem societies, capable of handling tensions related to these dynamics. Networks as mixes of
public and private actors have potential as a governance device, they also give rise to a number
of 'constitutional' questions. These are not to be neglected in their life cycle. Networks as forms
of co-governance suit governing situations where a relatively open form of (public-private)
interplay can be organised to represent a variety of interests.
Regimes
Regimes can be said to have been designed to manage the multiple interconnectedness of modem
international relations. In a leading definition, regimes are seen as 'a set of implicit or explicit
principles, norms, rules and decision-making procedures around which actors' expectations
converge in a given area of international relations. Several authors have noted that the four
elements of this definition are not on the same level: norms and values underlie rules and
procedures. Rules and procedures may change over time; but must remain consistent with the
norms underpinning - and defining the characteristics of - the regime. Changes in rules and
procedures mean changes within regimes, changes in norms and values imply a change of
regime. Why create, why join a regime?
A stock answer is: to solve puzzles posed by common problems or by technology. But
recognition of a common problem is not a necessary condition for joining a regime; joining may
be encouraged by the attractiveness of proposed solutions, even if the problem itself is of little
concern to the actor. So what do regimes provide for their members?
First, they establish stable expectations of each other's behaviour, permitting the development of
working relationships; and second they provide information and yardsticks/standards of - not
necessarily proper - behaviour.
How does one recognise successful regimes? Crucial elements are their coherence, effectiveness
(compliance) and durability. It appears that regime performance should not be overestimated.
Despite professed intentions, regimes are in practice anything but constant, nor are they
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continuous over time. They are easily upset by changes in balance of bargaining power or
changes in perception of national interest. What is actively promoted as an orderly regime may
not work well, while elsewhere unstoppable regime-like structures may arise in silence. New
understanding of regimes facilitates this. Buhl sees a web of regimes closing in on the globe. The
density of some regimes is such that an Alleingang becomes an impossibility. A regime can be
called 'strong' when it is highly institutionalised, high-trust, and enhances the identity of its
members. If principles become less coherent, or if actual practice is increasingly inconsistent
with them, a regime will weaken. However, even strong regimes may fall apart when powerful
challenges or exogenous shocks change the beliefs and/or allegiance of members.
Formal regimes may be regarded as the tip of the iceberg, what lies beneath is a formal-informal
amalgam governing an issue area, constraining or expanding the scope for individual action, and
sanctioning non-compliance. Regimes and actors, in turn, are nested in structures that can also be
termed (sub-)regimes and (sub-)networks, which constrain or expand the terms in which
'upperstructure' regimes can evolve. For example, (implied) sanctions for non-compliance may
find their way into accepted norms and practices of international law.
Much of what has been said above points to the power of value judgements. Normative questions
are involved: is equilibrium desirable? Is order positive? Attention to structures of security,
finance, welfare, knowledge and power is crucial to correct easily overlooked value biases.
Due to their position in between permanent structure and general policy planning, regimes are
much like technocratic management systems and therefore difficult to control democratically.
But though they are often (at least nominally) based on consensus-building, they are not
politically neutral. Regimes are politics, exactly because they are based on values.
Therefore the development of a meta-regime consisting of rules and criteria necessary for
creating regimes that are accountable to those affected could be a useful and fruitful objective.
Regimes are in the eye of the beholder. It is acceptable to posit regimes conceptually even if they
cannot easily be demonstrated. Regimes are conceptualised as institutions, as systems of
governance, and as expressing 'both the parameters and the perimeters of international
governance'. Typically a demand for governance arises in issue areas where interdependence
among states creates both conflicts and incentives for cooperation. The above quotes underline
the importance of regimes as a form of co-governance in the international arena. They also hint
at generalising insights from this literature to arenas outside the scope of international relations.
Regimes as a form of co-governance suit governing situations where parties adhere to a set of
agreed upon action rules.
Hierarchical Governance
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If from the exposition on modes of governance so far, it might have appeared as if governing has
basically changed, this impression is (probably) wrong. The rationalised, bureaucratic or
hierarchical state so well described and modelled by Max Weber, is still around us, and very
much alive. At its margins - and maybe even at the centre here and there - cracks are appearing
and critical voices about its performance are becoming more vocal. Whether the state is
'withering away', 'hollowing out', Entzaubert ('lost its magic') or even La fin de l'Etat? ('ended'),
as some observers advance, remains more a point of view than anything else. The hierarchical
model of societal governance may have lost some of its classical glory, but in many areas of
social-political life it is still a major governing actor to reckon with, and thus it should be given
its due place in analysing societal governance. It would be neglectful then, not to take this model
of societal governance seriously, either state-wise or in other societal domains.
Equating hierarchy with bureaucracy, and even more so with public bureaucracy, as is often
done, is too easy, and means losing the opportunity to use these concepts for different purposes.
For instance, the organisation of the Roman Catholic Church is always called a hierarchical one,
not due to its bureaucratic traits, but because of the hierarchical structure of the clergy. I treat
bureaucracy as a structural level of certain governing actions, and hierarchy as a far broader
concept. In fact I consider it the structural component of governing interventions. For systematic
thinking about hierarchy as an important form of 'rational social action' we can go back to Dahl
and Lindblom's classic Politics, Economic and Welfare (1963). For them hierarchy is, next to
polyarchy, the price system and bargaining, one of four major processes for calculation and
control, involving leaders and non-leaders. 'Hierarchy is the process in which leaders control
non-leaders'. Hierarchy is not seen as a pure unilateral control and is considered to be a
continuum, conceptualised in terms of its contribution to rational social action, as well as its
costs.
This part is entitled as 'hierarchy', to underline the fact that the types of governing interactions
discussed display a 'top-down' character: those governing are, or see themselves, as in some way
superimposed above those governed. There are many ways to express this relation, but hierarchy
comes closest to the essence of the ordering of such governing interactions. Although the term
hierarchy may suggest a uni-directional mode of governance, we deal here with governing
interactions, be it of a special type. Hierarchical governance as a structural arrangement, should
be seen as embedded in a broader category of societal interactions, in this case interventions.
These, of all forms of societal interactions, are the most 'vertical' and formalised ones. Governing
entities influence the behaviour of other actors participating in these interactions, even
involuntarily and often with sanctions attached. Such interventions are common to all spheres of
societal life, as well as to the hierarchical way of governing interactions. Because of their general
binding character and the sort of sanctions available, public interventions (and the state as its
hierarchical expression) have received more attention in theory as well as in practice, than those
in other societal spheres. These undoubtedly have an importance of their own, but in the context
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of this chapter, the public form of interventions and hierarchy will receive most attention.
To start the discussion, we will first deal with the two concepts steering and control, which can
be considered as giving body to this governance mode. Steering and control are ways of
conceptualising intervention processes, and as such express and cover many societal governing
interactions of a top-down nature. This discussion will be followed by focusing on the state as
the interventionist institution par excellence. As will be shown, we may better speak of a
changing role than of a shrinking role of the state in societal governance. This will be illustrated
by drawing attention to some changes in state activity: from command to regulation, from
procuring to enabling and from benevolence to activation. The chapter ends by focusing on three
major forms of interventionist interactions, and the changes they are subject to. To underline that
we have to see these interventions 'in context', as expressing the hierarchical governance mode
they represent, the 'arena' will be referred to in discussing them, the legal arena and the policy
arena.
Steering and control Steering
Steering is a powerful metaphor for (public) governing in the traditional sense. In Plato we find
evidence of this image for the polis, the city or the state as a ship. And even at that time it had
lost its course in his opinion: 'speaking about a captain a bit deaf and short-sighted, limited in
seamanship; a crew quarrelling about how to navigate the ship not having learned the art of
navigation . . . trying to get hold of the helm'. Recently, the idea of steering as a governance
concept has lost favour, despite it, only a few decades ago, being one of the promlsmg ideas in
cybernetic-systems theorising, with its high expectations of the governability of societies.
Although 'steering the ship of state' has apparently lost its attraction in scholarly political and
administrative circles, steering is still daily governing practice, particularly when coping with
societal dynamics. In current literature, it is assumed that such governing situations don't exist
any more, and thus this sort of theorising is outdated. This is a short-sighted view. There are still
many areas of societal governance where the steering metaphor is still apt at capturing what is
going on and describing practical ways of dealing with societal dynamics.
The key element of steering, whatever version one might apply – from a rather mechanistic to a
highly voluntary one - is direction. Steering is arguably a global and non-mechanistic form of
'directed' governing. Direction dictates that governors, in interaction with those governed, have a
general idea of where they want to go: a global image of a future state they prefer above the
existing one. This direction in steering as a governing activity may be goal oriented, but it is
better to speak of goalseeking than goal-setting. Since steering is a way of intervening, it looks
uni-directional and top-down, such as expressed in goal-setting. However, as with all governing
activities, steering is an interactive occupation, for which goal-seeking seems preferable to
goalsetting. Plato was well aware of this. The ideal state is, in his opinion, like a well-built ship,
when steering the right course depends on the interaction between captain and crew: 'But how do
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reason and the senses combine to ensure the safety of a ship, in fair weather or foul? Isn't it
because captain and crew interpret sense-data by reason, as embodied in the expertise captains
have, that they keep themselves and the whole ship safe?' And in sociocybernetic theorising, the
steering governor is not conceptualised in terms of exerting power, but 'as the boss . . . who
guards over interactions'.
Control
Traditionally, control in the public sector is considered a matter of political accountability and/or
a matter of political-bureaucratic relations. In the Weberian tradition both were 'insured' by
proper legal/constitutional and bureaucratic rules. While this 'insurance' as norm is not in doubt,
serious questions have been raised about the practice of such rules?
Modern public organisations are highly complex and diverse 'cobwebs'. Controlling them from
within or from without demands abilities to 'mirror' these traits, in other words the controller has
to be as complex and diverse as the cobweb to be controlled. The more complex tasks to be
carried out are, the more difficult it is to control them. In modern (public) governance top-down
control is still an important mode of controlling complex activities, but other arrangements
providing checks and balances, and even bottom up control, are wide spread to cope with
complexity.
Control of diversity within the public sector is not only expressed in the variety of institutions
with specific control functions (audit offices, courts, management controls), but also by the
plurality of instruments available to and used by these offices. Not only is trying to master
diversity in the ways mentioned a characteristic of modem (public) governance, many of these
controlling efforts are at odds with each other, in substance, scope, time and sanctions attached to
them. Within the market sector, the hierarchical mode of governance also exists, and is phrased
in the relevant literature either as control or as power and control. In their typology of governing
mechanisms Campbellet al. distinguish all kinds of hierarchical interactions in the market, such
as vertical and horizontal integration, conglomerates and job-control union contracts. Each of
these governing mechanisms has its own rules and procedures for compliance, with
combinations of coercion and consent. Exercising power and control is, according to these
authors, a critical impetus for change in markets, in particular in the
struggle for new governance structures and institutionalising new power relations. In the same
vein Fligstein argues that control processes within markets reflect internal and across-firm power
struggles. Concepts of control and the understanding of how a market works, allowing actors in
it to interpret their world and to act in control situations. He also discusses a hierarchy or status
ordering of firms in a given market. In stable markets the identities and status hierarchy are well
known, as is a great deal of agreement on conceptions of control and the strategies implied in
them.
Of steering and control as major expressions of hierarchical governance, steering is the more
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'political' of the two; control is more 'administrative' in nature. Steering has more dynamic
features, while control is geared further towards governing complexity and diversity.
The changing face of the modern state
States, even if they possibly show 'hollowing-out' tendencies, are still the central and
omnipresent interventionist societal entity. Although other constructions are tested, and are
becoming more and more accepted, hierarchy is still the most common attribute for public
governing bodies. They continuously intervene, they steer and control, their structure is
hierarchical from local to international level, and for all practical purposes, they are expressions
of the modem state.
The state may change its ambitions, but seldom will it give up or wither away completely. It
will redefine its hierarchical mode of governance in the light of shifting aspirations.
From command to regulation
The commanding state has, according to Majone, three major ways of intervening in the
economy: income redistribution, macroeconomic stabilisation and market regulation.
Redistribution includes transfers of resources from one group to another as well as the provision
of 'merit goods' that citizens are compelled to consume. Stabilisation attempts to achieve and
sustain satisfactory levels of economic growth and employment. Market regulation aims at
correcting certain types of market failure.
All modem states use these methods of intervention, although to what extent differs from country
to country, and from period to period. The redistributing interventions called for its own
structural epithet on: the welfare state or varieties of those. This - in my view - commanding state
has or had the following characteristics:
tax-and-spend as the major instrument budgetary allocations as the main arena of political
conflict parliament, ministerial departments, nationalised firms, and welfare services as
characteristic institutions political parties, civil servants and corporate groups as key actors; the
political style is discretionary policy culture - corporatist and political accountability - direct.
This commanding state being at its height in the 1970s, showed or was believed to show all kinds
of defects, so it moved to another epithet on, the regulatory one.
This regulatory state is characterised by privatisation, liberalisation, welfare reform and

deregulation. In the regulatory state the emphasis is less on direct, rigid and restrictive rules and
interventions, than on administrative decentralisation and regionalisation. These new and indirect
interventions require new structures of responsibilities and new forms of control and
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accountability. The regulation is aimed at third parties, who provide the merit goods, according
to rules set by central authorities or bodies especially created for that purpose. According to
Majone, the regulatory state can be characterised by its main function, of correcting market
failures, using rule-making as its main instrument. The main area of political conflict is review
and control of this rule-making; characteristic institutions are parliamentary committees,
independent agencies and commissions and tribunals; key actors are single-issue movements,
regulators, experts, judges; the policy style is rule-bound legalistic, the political culture can be
described as pluralist and political accountability is indirect. Because of these specific features
the regulatory state may have problems with its legitimacy, which might be best tackled by
strengthening its accountability structures.
The transformation from command to regulation shows a considerable change in aims and
tools, however, the state remains the central governing entity.
From procuring to enabling
In another vein, withdrawing tendencies of the state in areas of service provision such as welfare,
social security, health and education, demand attention. In the classical notion of the welfare
state procuring such services was a major public task. This retreating process expresses the
notion that the state should limit itself to a number of core activities: those which it considers
cannot be left to others. Control instruments are put in place, instead of procuring those services
or products itself. Although other terms are used, they will here be brought together under the
term 'enabling'. Important in this move from procuring to enabling is the introduction of market
thinking and market mechanisms either directly, such as by introducing competition into the
delivery of those services, or indirectly, by the use of instruments such as contracts and
evaluation to control these provisions. The idea of enabling is also linked with notions of
removing constraints and creating incentives, thus offering providers and clients opportunities to
achieve individually tailored solutions, which the state itself could never produce. This move
towards enabling results in the question 'who is enabled by whom to do what?' Although the state
always had some kind of an enabling role, the recent shift in emphasis has been from the citizen
being enabled by state provision, and thus being the enabled party, to enabling the providing
agency, either on a profit or nonprofit making basis. There are also elements in the concept of the
enabling state to reduce or replace influence of organised (corporatist) interest groups, and to
enhance the role of the voluntary and informal (civil society) sector. Next to these ambitions,
there is the shift towards privatisation, not only to reduce costs but also to improve the
performance and effectiveness of tasks and services. All these changes have their positive and
negative points, which in the literature and in practice are subject to (sometimes heated) debate.
It would be too narrow a view to see all this in terms of management, either 'new public', or
otherwise.
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By using market mechanisms for the provision of (public) services, the enabling state raises
serious questions about its functions and competencies, its boundaries and role, in other
words about the nature of its governing and governance.
From benevolence to activation
A third direction, through which the traditional state does not give up, but changes its focus
while retaining its basic pretensions, is in relation to the citizen. In German public governance
the 'activating' state is, in theory as well as in practical politics, a rising star. One can take
different starting points to mark this re-orientation, but an original one is Max Weber's concept
of 'legitimate or legal authority', expressing the hierarchical element of the relation between
citizen and state, as well as principles of legality.This form of state appearance can be found in
concepts such as the 'liberal democratic state', with its emphasis on individual rights and a
retaining role of the state; or in the Soziale Rechtstaat and comparable notions, consisting of an
almost unlimited involvement of the state in, and responsibility for, the life and well-being of its
citizens. All these substantive state roles in relation to its citizens are based upon principles of
'legal hierarchical authority', i.e. the benevolent state.
In the concept of the activating state a new position and role is suggested that tries to find a way
out of the situation of the state structurally being unable to fulfil all the tasks requested of it
(overload) or leave them to others (communitarism, subsidiarity or privatisation). In the concept,
the initiative for societal activities emanates from the state, but it is not held responsible for full
implementation of the goals to be achieved. Key elements are: mobilisation, guiding, support,
R&D and 'public grease'. The realisation that the state cannot solve all societal problems is not
considered to be an argument for a 'minimal state', but for a state that systematically scrutinises
which tasks can be most effectively carried out by whom, either by doing so itself, by developing
and stimulating self-governance, or in co-operation. It has a strong dynamic dimension externally
because it operates in continuous interaction with activated citizens and
citizen groups at all levels of governance, particularly in areas where goals are vague and
instruments under-developed. This external interaction requires an internal reform strategy, in
which innovative external initiatives constantly demand new priority setting, demand-supply
orientation, quality control, and guarding of negative external effects.
The essence of the activating state involves the promotion of civic potentials by means of
sharing tasks and duties. Overall responsibilities of the state are not abandoned but given a
new. Dynamic and innovative substantive quality.
1.5 Governance and Stakeholders

Although stakeholder in governance is situational and subjective it depends on types of
governance, etc. But State, Private Sector & Civil Society are almost common in all.
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Governance includes the state, but transcends it by taking in the private sector and civil
society.
The state creates: conducive political and legal environment.
The private sector: jobs and income.
The civil society: facilitates political and social interaction.
Because each has its weaknesses and strengths, major objective governance is to promote
constructive interaction, interdependence & inter-penetration among all three STATE: Fall
& Rise Apart from the concept of ―Hollowing out of State and ―The Governance without
Government, literature on the new governance highlights the role of markets, networks, and
nonstate actors. Hence, the term governance has come to refer to social and political orders
other than the state. Emergence of regional regimes and institutions (Like EU), &
International Governance has following implications.
Eroded the autonomy of nation states
Emphasizes on networked polity (a particular form of government that exists within a state
or an institution)
International governance is no longer be based on purely voluntary cooperation of sovereign

States, but will be based on shared normative concepts. The OECD has defined global
governance ‗as the process by which we collectively manage and govern resources, issues,
conflicts and values in a world that is increasingly a ―global neighborhood. But, States will
remain the most important actors in international law and international relations, but they
have to adapt to the changing circumstances in the present international society. However, in
the response of NPM, the recent developments like emergence Network Management again
accepts the role of the state as a coordinator. PRIVATE SECTOR: Redefining its Role
New governance refers to the apparent spread of markets and networks following upon these
reforms. Recent public-sector reform has occurred in two principal waves. The first wave
consisted of the new public management (NPM), a neo-liberal agenda of increasing the role
of markets : Marketization. It was inspired by ideas associated with neoliberalism and public
choice
theory. In developed countries the impetus for NPM came from fiscal crises. Talk of the
overloaded state grew as oil crises cut state revenues and the expansion of welfare services
saw state expenditure increase as a proportion of gross national product. The result was a
quest to cut costs. NPM was one proposed solution. In developing and transitional states, the
impetus for NPM lay more in external pressures, notably those associated with structural-
adjustment programs.
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NPM has two main strands: marketization and corporate management. The most extreme
form of marketization is privatization. Privatization is the transfer of assets from the state to
the private sector. Some states sold various nationalized industries by floating them on the
stock exchange.
Other state-owned enterprises were sold to their employees through, say, management
buyouts. Yet others were sold to individual companies or consortiums. Industries subject to
dramatic privatizations included telecommunications, railways, electricity, water, and waste
services. Smaller privatizations involved hotels, parking facilities, and convention centres, all
of which were as likely to have been sold by local governments as by central states.
Other forms of marketization remain far more common than privatization. These other
measures typically introduce incentive structures into public-service provision by means of
contracting out, quasi-markets, and consumer choice. Marketization aims to make public
services not only more efficient but also more accountable to consumers, who are given
greater choice of service provider. Prominent examples of marketization include contracting
out, internal markets, management contracts, and market testing. Contracting out (also
known as outsourcing) involves the state‗s contracting with a private organization, on a
competitive basis, to provide a service. The private organization can be for-profit or
nonprofit; sometimes it is a company hastily formed by those who previously provided the
service as public-sector employees. Internal markets arise when departments are able to
purchase support services from several in-house providers or outside suppliers that in turn
operate as independent business units in competition with one another. Management
contracts involve handing over the operation of a facility—such as an airport or a convention
centre— to a private company in accord with specific contractual arrangements. Market
testing (also known as managed competition) occurs when the arrangements governing the
provision of a service are decided by means of bidding in comparison with private-sector
competitors. Typically, marketization transfers the delivery of services to autonomous or
semiautonomous agencies. Proponents of NPM offer various arguments in favour of such
agencies. They argue that service providers are then able to concentrate on the efficient
delivery of quality services without having to evaluate alternative policies. They argue that
policy makers can be more focused and adventurous if they do not have
to worry about the existing service providers. And they argue that when the state has a hands-
off relationship with a service provider, it has more opportunities to introduce performance
incentives.
Corporate management reform involves introducing just such performance incentives. In

general, it means applying to the public sector ideas and techniques from private-sector
management. The main ideas and techniques involved are management by results,
performance measures, value for money, and closeness to the customer—all of which are tied
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to various budgetary reforms. Although these ideas and techniques are all attempts to
promote effective management in the public sector, there is no real agreement on what
constitutes effective management. To the contrary, the innocent observer discovers a
bewildering number of concepts, each with its own acronym. For example, management by
objectives (MBO) emphasizes clearly defined objectives for individual managers, whereas
management by results (MBR) emphasizes the use of past results as indicators of future ones,
and total quality management (TQM) emphasizes awareness of quality in all organizational
processes. Performance measures are concrete attempts to assure effective management by
auditing inputs and outputs and relating them to financial budgets. Such measures vary
widely because there is disagreement about the goals of performance as well as how to
measure results properly. Nonetheless, value for money is promoted mainly through
performance measures to influence budgetary decisions.
The success of NPM has been unclear and remains a source of considerable debate. Few
people believe that it proved to be the panacea it was supposed to be. Studies suggest that it
generated at best about a 3 percent annual saving on running costs, which is modest,
especially considering that running costs are typically a relatively small component of total
program costs. Even neoliberals often acknowledge that most savings came from
privatization, not reforms in publicsector organizations. The success of NPM appears to vary
considerably with contextual factors. For example, the reforms were often counterproductive
in developing and transitional states because these states lacked the stable framework
associated with elder public disciplines such as credible policy, predictable resources, and a
public-service ethic. It is interesting that, in this respect, NPM appears to require the
existence of aspects of just that kind of public-service bureaucracy that it was meant to
supplant.
But flying wings of market got restrained by the second wave. The second wave of reforms
consisted of attempts to develop and manage a joined up series of networks informed by a
revived public sector ethos. Typically, managerial reforms of the first wave gave way to a
second wave of reform focusing on institutional arrangements (networks and partnerships)
and administrative values (public service and social inclusion). The second wave of reforms
included a number of overlapping trends, which are often brought together under labels such
as ―joined-up governance,‖ ―one-stop government,‖ ―service integration,‖ ―whole-of-
government,‖ or ―aktivierender Staat‖ (German: ―activating state‖). Some commentators
even describe this second wave as a ―governance approach‖ or ―new governance‖ defined
in contrast to NPM.
Several connected reasons can be given for the altered nature of public-sector reform. One is
the shifting tide of intellectual and political fortunes. To an extent, the fortunes of public
choice theory and neoliberalism ebbed while those of reformist social democrats and network
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theorists rose. The rise of New Labour (see Labour Party) within the United Kingdom is
perhaps the most obvious example of this tide. A second reason is a growing sensitivity to a
new set of external problems, including terrorism, the environment, asylum seekers, aging
populations, and the digital divide. Many of these problems led people to turn to the state
rather than markets and to do so with concerns about equity rather than efficiency. Yet
another reason for the changing content of public-sector reform resides in the unintended
consequences of the earlier managerial reforms. Observers emphasize that NPM led to a
fragmentation of the public sector; because public services are delivered by networks
composed of a number of different organizations, there is a need to coordinate and manage
networks. Observers also emphasize that NPM raised dilemmas of accountability; even if the
autonomous and semiautonomous organizations involved in delivering services are more
efficient, they are not always easy to hold accountable on matters of equity. These worries
about accountability were exacerbated by exposures of corruption in the
private sector and by studies emphasizing the public‗s lack of trust in government.
The main thrust of the second wave of reforms was to improve coordination across agencies.
This ambition to join up networks reflected concerns that the earlier reforms led to the
fragmentation of public-service delivery. Joined-up governance promotes horizontal and
vertical coordination between the organizations involved in an aspect of public policy.
Although the boundary between policy making and policy implementation is blurred, joined-
up approaches look rather different in each case. Joined-up policy making brings together all
the agencies involved in dealing with intractable problems such as juvenile crime or rural
poverty. Joined-up policy implementation coordinates the actions of agencies involved in
delivering services so as to simplify them for citizens. An example is one-stop shops at which
the unemployed can access benefits, training, and job information.
Joined-up governance often draws on the idea that networks can coordinate the actions of a
range of actors and organizations. Indeed, its proponents often suggest that, in many
circumstances, networks offer a mode of coordination superior to that of both hierarchies and
markets. For example, networks tie an enabling or facilitative leadership within a network to
greater flexibility, creativity, inclusiveness, and commitment. Hence, joined-up governance is
as much about fostering networks as it is about managing them. Indeed, the second wave of
reforms characteristically attempted to promote networks or partnerships rather than markets.
Such partnerships were created between public, private, and voluntary bodies as well as
between different levels of government or different state agencies. In many countries the
emphasis shifted from competitive tendering to the public sector‗s building long-term
relationships based on trust with suppliers, users, and other stakeholders. Public-private
partnerships are said to have a number of advantages based on their ability to combine the
strengths of each sector. For example, they can ease the burden of capital investment on the
public sector while reducing risks of development for the private sector.
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Partnerships and joined-up governance are often advocated as ways of promoting social
inclusion as well as increasing efficiency. Ideally, they increase citizen involvement in the
policy process. Citizen groups participate as partners in aspects of policy making and policy
implementation. The second wave of public-sector reforms sought to activate civil society.
Partnerships and joined-up governance were supposed to provide settings in which public-
sector bodies could engage stakeholders—citizens, voluntary organizations, and private
companies— thereby involving them in democratic processes. It was also hoped that
involving stakeholders in the policy process would build public trust in government.
CIVIL SOCIETY: Reinventing It
Radicals, socialists, and anarchists have long advocated patterns of rule that do not require
the capitalist state. Many of them look toward civil society as a site of free and spontaneous
associations of citizens. Civil society offers them a nonstatist site at which to reconcile the
demands of community and individual freedom—a site they hope might be free of force and
compulsion. They appeal to global civil society as a site of popular, democratic resistance to
capital. Global civil society typically refers to nongovernmental groups such as Amnesty
International, Greenpeace, and the International Labor Organization as well as less formal
networks of activists and citizens.
The association of democratic governance with participatory and deliberative processes in

civil society thus arises from radicals seeking to resist state and corporate power. These
radical ideas are not just responses to the new governance; they also help to construct aspects
of it. So we can see that the emergence of Governance leads to redefine the roles of State,
Private Sector and Civil Society. And also it also engender a complex relationship among
themselves, which is based on cooperation, competition and sometimes conflict.
1.7 Challenges to Governance
The governance turn in political science and public administration has set out important lines
of investigation that grapple with the central challenges of governing in today‗s world –
especially
in the advanced industrial democracies. The strength of the political science literature is the
range and variety of its empirical studies. Moreover a variety of theoretical frameworks are
on display ranging from rational choice to cultural institutionalism. The debate has shown a
capacity to throw up useful new conceptual insights such as the idea of governance failure or
the options for meta-governance. As Bob Jessop reminds us ‗markets, states and governance
all fail. This is not surprising. For failure is a central feature of all social relations‗ (Jessop,
2000:30). But what counts as failure in governance? There are at least two possibilities. The
first expression of failure may be the absence of a process of engagement and re-engagement
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among partners. To put it the other way around, when asked for their criteria of success,
partners often cite the numbers of meetings held and the continuing existence of a process of
dialogue and negotiation as a positive measure. So a lower tier of governance failure would
be the breakdown of ongoing reflection and negotiation among partners. However, it appears
slightly bizarre to leave the issue there. The reflection and negotiation must ultimately be
about achieving some social purpose.
The higher tier of governance failure must be based on an assessment of its capacity to
produce more effective long-term outcomes than could have been produced using markets or
imperative coordination by the state. It is necessary to consider not only the doing of
governance – either by coalition-building or by government steering and pulling policy levers
– it is also necessary to consider the impact of governance.
Governance failure could occur for a multitude of reasons because, as Sorensen and Torfing
(2007:96) comment, ‗network governance relies on precarious social and political processes
and takes place in an uncontrollable political and economic context‟. The features of
governance that make it particularly prone to failure include the high transaction costs in
developing partnerships and networks failure, a discrepancy between the temporal or spatial
horizons of the various actors and the weakness or lack of capacity for those charged with the
task of metagovernance, providing the steering to the system.
Some actors may enter the governance relationship with a very localist perspective, for
othersthe boundary is regional, for still others it may be international. Reconciling these
different spatial perspectives is complicated. In the same way with respect to time-scales
what is short term to some will appear like an eternity to others. Governance arrangements
are in general about encouraging a longer-term time horizon but the perception of ‗long
term‗ for a community group, politician or multinational company is likely to vary to such a
degree that governance failure may result. Electoral considerations may encourage politicians
to break apart complex governance arrangements for short-term advantage. But generally
governance learns to cope with politics.
Conflict between partners is not an inherently undermining factor as far as governance is

concerned. A never-ending series of conflicts is characteristic of market societies, and these
conflicts can be managed as long as they are divisible, that is conflicts over actors getting
more
or less. Such conflicts lend themselves to compromise and the art of bargaining. Yet they are
never resolved ‗once and for all‗ and so the scene is always set for the next round of
negotiation. The cumulative experience of managing numerous such conflicts is at the heart
of an effective governance. The cause of failure is conflict that is not divisible. Conflicts
which are driven by matters of religion, race, language or ideology, which have an ‗either-
685
or‗ character and present considerable difficulties to governance (cf. Hirschman, 1995: Ch.
20). They are not inherently irresolvable but in so far as they figure strongly they are likely to
make the compromise and messiness central to governance appear inadequate. Emphasising
the ‗improbability of success‟ (Jessop, 2000:30) for governance should not be read as
leading to the conclusion that it is necessary to look elsewhere for salvation. On the contrary,
by recognising the incompleteness of any particular governance, the aim is to encourage
continued experimentation and learning. Jessop (2000:31) argues that those concerned with
governance should deliberately cultivate a ‗flexible repertoire‗ of responses. This in turn
involves a commitment to review and reassessment, to check that mechanisms are achieving
desired outcomes and a ‗self-reflexive irony in which participants ‗recognise the likelihood
of failure but proceed as if success were possible‗.
Rhodes (1997b) comes to similar conclusions in his analysis of governance and argues that
government needs to keep on picking up the skills of indirect management and learning.
According to March and Olsen (1995:161): ‗Democratic political systems have generally
insisted on an allocation of personal accountability for political outcomes that most modern
students of political history would consider descriptively implausible‟. This observation
captures well the dilemma created by a system of governance in which its essence is the
interaction between varieties of actors. The narrative of the democratic basis for governing in
modern industrial economies is of informed consent as the basis of governmental authority.
Those who hold office in these circumstances have to be active representatives, providing
both an account of their (proposed) actions and being subject to enforced accountability for
results achieved and outcomes. Accountability, therefore, involves justification and being
held responsible. Democratic theory usually demands that someone takes a leadership role in
both functions. Governance with its ‗problem of many hands‗ makes the quest for
responsibility already demanding under established democratic governance arrangements but
in the context of complex organisations it gets even more challenging (Bovens, 1998).
There is much ‗wringing of hands‗ in the governance literature in political science and public
administration as writers worry about whether governance can be made accountable. Pierre
and Peters (2005:5, 127) are clear that it is necessary for ‗those actors delivering governance
to society to be accountable for their actions‗, and warn that ‗we still have not developed a
model of political accountability in a governance perspective‗. Rhodes (1997a:21) notes
that recent changes in the form of governance has ‗led to a chorus of complaints about the
loss of democratic accountability‗, but goes on to argue that although new governance forms
challenge existing practices of accountability, they do not undermine the idea of
accountability in a democratic society. The challenge is that ‗accountability can no longer be
specific to an institution but must fit the substantive policy and several institutions
contributing to it‗ (Rhodes 1997a:59). Pierre and Peters (2005: 133) argue contrary to Rhodes
and others, they think that accountability even in the context of governance demands a focus
on institutions and in particular the institution of the state. For them, the state can be brought
686
back in as the guarantor of the public interest and the key legitimate democratic institution.
Its task is to subtlety manage governance processes to address issues of justice and liberty
that reflect central political values (Pierre and Peters, 2000, 2005). The solution offered by
Pierre and Peters can be criticised as a bit of „sticking plaster‟ affair.
They hope that the state can make good the damage done to accountability by governance by
imposing state steering on top of governance structures. The problem remains, however, that
the state is the state. An institution defined by its monopoly of institutional coercion may
learn new techniques but cannot disguise from citizens its essential core. Moreover, in
complex settings, attenuated lines of accountability apply whether the governance structure is
in network form or directed by central state. Accounts of attempts at state steering (see for
example Stoker, 2000a) return continually to the difficulties the state has in presenting itself
in a more flexible light touch mode. But what is at issue is more than failure to learn new
tricks. It also reflects a dominant image of the state in the minds of those from business,
voluntary and community sectors namely that it is not only prone to bureaucratic rigidities
but that it is an agent of coercion and control.
As a result there is a fundamental underlying tension between state steering and the form of
engagement that could guarantee democratic accountability. Perhaps we need to re-examine
the concept of accountability in a more fundamental way. Bovens (1998, 2006) asks why
public accountability is so important and comes up with three answers. The first is
accountability is about monitoring and controlling governing processes.
Perhaps this is the test that others feel that governance most obviously fails, but as suggested
by Rhodes (1997a) in terms of system accountability, within a policy area, governance with
its interaction between state and non-state actors may offer at least some form of
accountability. But Bovens offers two additional views that take us into territory not already
touched on in the discussion in this chapter. Accountability could be viewed as the
establishment of systems to prevent the concentration of power and accountability. In a
complex world of decision-making holding an individual to account is often an exercise in
constitutional fiction given that any individual responsibility for a decision is limited but
what accountability demands is that there are checks and balances and practices of power-
sharing built into the system of governance.
Accountability could again be seen as a system characteristic rather than focused on an

individual if it was viewed as demanding that a governance system should have learning
capacity built in, in order to ensure that it adjusts and improves as it meets problems. If
accountability concerns stay focused on individuals to be held responsible then governance
arrangements will often appear to be lacking accountability given their inherent quality of
‗many hands‗. But if accountability is seen as a quality that can be displayed by at a system
level then new forms of governance may score more highly than those of a more established
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government form precisely because they can involve ‗many hands‗ and so in practice diffuse
power and they provide an effective arena for joint learning and reflexive policy practice.
Chapter Two
Good-governance: A development Perspective
2.1 Concepts and Evolution of good governance as development agenda
Since the 1990s, the idea of ‗governance‗ has come to occupy the centre stage in thinking
about development. This occurrence closely mirrors the evolution of a dominantly pro-
market perspective in mainstream development policy to one that recognises the significance
of the state and the nature of politics more generally in impacting on development processes
and outcomes.
Governance is the term, indeed the overarching category, which is predominantly used by
international development agencies to encapsulate these recent concerns. However, the more
popular and seemingly consensual the use of the term became amongst policy-makers, the
more contentious and critical were the responses it generated amongst scholars. As a result,
the literature on governance within the Development Studies discipline is sharply polarised.
This polarisation reflects the contested nature of the discipline itself. Development Studies
has been described as an ‗unusual enterprise‗ (Corbridge, 2007:179) for it appears to be
committed at the same time to the principle of ‗difference‗, in treating the ‗Third World‗ as
different from the West, and that of ‗similarity‗, in development‗s mission to make the
peoples and processes of the developing world more like that of the developed world. For a
number of reasons which we will explore in this chapter, the governance agenda encapsulates
both these dimensions. While on the one hand, it has accompanied the growing realisation
that universalistic free-market policies cannot succeed in the countries of Asia, Africa and
South America unless due consideration is given to their particular governance structures and
processes (the principle of difference), on the other hand, western governments and aid
agencies have formulated a very clear articulation of what they regard as ‗good governance‗
on the basis of western experiences and contexts (the principle of similarity). In this sense,
debates around governance mirror the larger concerns of the discipline of development
studies.
The concept of governance has allowed for the intellectual advancement of development
studies in offering explanatory frameworks for understanding the contradictions and crises
generated by the free market paradigms of the 1980s. What was special about the governance
idea was the ease with which it allowed even mainstream development organisations to see
eye-to-eye with critics on the causes of these contradictions and crises. This chapter explores
688
what precisely allows governance to perform this function, where other concepts might not
have succeeded, and the implications of this seeming acceptability. Equally, the concept of
governance has elicited a new wave of critical responses that aim to understand the
fundamentally unequal nature of relationships between and within the developed and
developing parts of the world. This chapter also aims to show why these critiques are so
relevant to the continuation of the core debates in development studies. For narrative ease,
the chapter is organised in three sections. Section one discusses briefly the evolution of the
concept and the key conditions that led to its rise. It focuses on the central definitional
framework for governance in development studies, that of ‗good
governance‗. It also demonstrates how there are different shades to this good governance idea
depending on the principles and concerns of the sponsoring organisation.
Section two unpacks the apparent consensus around governance and discusses the major
areas of debate around it. Section three focuses especially on how the concept of governance
has been used to further an incisive understanding of the very unequal relationships of power
that define the concerns of development, and of development studies.
Evolution of Good Governance Agenda
In 1989, the World Bank (WB) published a report titled ‗Sub-Saharan Africa: From Crisis to
Sustainable Growth‗, which declared that Africa was witnessing a ‗crisis of governance‗
(World Bank, 1989:60). This observation came at the end of nearly a decade of structural
adjustment, which had been the basis of a new wave of policy-oriented loans by the WB,
International Monetary Fund (IMF), and other western donors to several developing
countries (Lancaster, 1993; Williams and Young, 1994). Structural Adjustment Programmes
or SAPs reflected the predominant neoclassical position that extolled the virtues of the free
market and upheld that the ‗state‗s economic role should be confined to assuring the proper
functioning of markets as themoperative mechanism of resource allocation‗ (Sklar and
Whitaker, 1991:341). However, the experiences of SAPs in the 1980s in Africa, and
elsewhere too, decisively showed that adjustment was a political matter, with major impacts
of the production and distribution of resources (Leftwich, 1994; Haggard and Kaufman,
1989). What also became clear during this time was ‗that the ability to plan and implement
adjustment was largely a consequence of both political commitment, capacity and skill, as
well as bureaucratic competence, independence and probity‗ (Healey and Robinson, 1992;
cited in Leftwich, 1994:370). As World Bank President Barber Conable put it, ‗If we are to
achieve development, we must aim for growth that cannot be easily reversed through the
political process of imperfect governance‗ (Conable, 1992; cited in
Doornboos 2001:98). The crisis of governance then, as described by the WB, referred to a
crisis in areas that were not officially within its domain.
The Bank is constrained by its Articles of Agreement, which expressly forbid taking
689
noneconomic considerations into account in its operations (Articles III 5b, IV 10 and V 5c in
Williams and Young, 1994:84). It is with no coincidence then, that it is frequently said that
‗the international community, especially the WB and IMF, has taken refuge in the concept of
governance or institutions when referring to things political‗ (Hyden, et al., 2004:12; others
like Doornboos, 2001; Gibbon, 1993; Leftwich, 1994; Lockwood, 2005; Martinussen, 1998a;
and Williams and Young, 1994; have voiced similar views).
While the concern for sustained economic growth continued to provide the principal impetus
for the thrust on governance, a number of attendant factors are significant to consider.
Leftwich (1994) regards the collapse of communist regimes in Eastern Europe to be
important in shaping the emergence of western interest in governance. In his view, the ‗new
international mcircumstances‗ after 1990 meant that the ‗west‗ could attach explicit political
and institutional conditions to aid without fear of ‗losing its third world allies or clients to
communism‗ (Leftwich, 1994:369). Moreover, the collapse of communist regimes
discredited those political systems as ‗bureaucratically sclerotic‗, ‗non-democratic‗ and
‗inefficient‗, while upholding elements of western political systems (in the USA and
Western Europe) such as political liberalisation and administrative decentralisation (World
Bank, 1991; as cited in Leftwich, 1994:369). This association of western liberal democracy
with governance has continued to be an abiding one within mainstream discourse.
Historically too, the 1980s witnessed prodemocracy movements in Latin America, the
Philippines and Eastern Europe, stimulating similar movements elsewhere (Huntington,
1991; as cited in Leftwich, 1994).
In Africa for example, between 1989 and 1992, a combination of internal and external
pressures put a whole host of countries on the path of democratisation, though not without
resistance from incumbent regimes (Leftwich, 1994). These events proved to be seminal in
legitimising the west‗s preference for liberal democratic systems, as opposed to communism,
and laid the ground for the active pursuit of democratisation to promote governance. Others
have commented that a distinction needs to be made between the Bretton Woods institutions
(WB and IMF) and the US Government, as ‗promoting democracy abroad is not a new
policy for the United States‗ (Lancaster, 1993:12). She views such emphasis in Washington
as a ‗practical response to a variety of domestic political imperatives…. such as finding a
rationale for a $15 billion a year foreign aid programme‗ (Lancaster, 1993:13).
Still others like Barya (1993) and Gills and Rocamora (1992) regard the concern for
democracyas a clear manifestation of the ‗onward march of global capitalism, which had
been delayed by the bipolar world‗ (as cited in Leftwich, 1994:370). Indeed, the motives for
the pursuit of democratisation through governance are amongst the most contested within the
Development
Studies literature. This is perhaps because they, more than anything else, reveal the fallacy of
the ‗apolitical‗ stance adopted by the international donor community under the cover of
governance, while dealing with matters that are explicitly political.
690
These issues are clearly reflected by the progression of events in the adoption of the
governance idea by the international donor community, with the WB in the lead (see Uvin,
1993; as cited in Doornboos, 2001:98 for more information). In 1991, the WB convened its
Annual Development Economics Conference with the express purpose of discussing its
future agenda, which in principle comprised nothing less than a ‗reform of politics in aid-
dependent countries‗ (Summers and Shah, 1997; as cited in Doornboos, 2001:98). Amidst
considerable uncertainty regarding the extent to which the governance idea could be cast in
political terms, the notion of ‗good‗ governance emerged as a necessary instrument enabling
the launch of a new generation of political conditionalities. The use of the ‗good governance‗
theme to drive political and institutional reforms of a particular sort through aid, marked a
watershed in the character of international development. It has been closely related to
strategies of institutional globalisation, and ‗provides a handle for the formulation of
political conditionalities by external actors, which previously did not dispose of ―politically
oriented‖ instruments for intervention and direction‗ (Doornboos, 2000:63). This sort of
intervention simultaneously marked a break from previous
ideas as ‗national sovereignty‗ and ‗non-interference in internal affairs‗, for long held in
high esteem in international politics (Doornboos, 2001). There is also the view that political
conditionalities have long accompanied aid provision with decisions on country aid
allocations being influenced by strategic, diplomatic and ideological considerations.
However, Doornboos maintains that ‗the new strategy of externally led political reform
should not be confused with earlier examples of external political pressures to demand a
particular policy position‗ because the ‗posing of demands on theoretically sovereign states
regarding the manner in which they should organise their institutional apparatus, policy
implementing procedures and indeed their political systems, goes a step further‗ (2000: 66).
In practice, the rise of good governance further facilitated the extension of conditionalities
around aid programmes. These were both economic (such as keeping inflation below 7% per
annum, or removing subsidies on fertilisers) as well as political (notably moving to a multi-
party system and promoting freedom of press) in nature. Although the WB has for several
years stuck to a strictly non-political projection of governance, it has also accepted the role of
secretariat for various donor consortia stipulating the political as well as economic
conditionalities that had to be met. This has given it the extremely strategic position, of
formulating, guiding and monitoring
political conditionalities, without actually compromising its stated non-political mandate

(Doornboos, 2001; Gibbon, 1993; Martinussen, 1998a). However, further evidence of
noncompliance and partial reforms that conditionalities engendered in recipient countries led
to the view that conditional aid was an ineffective instrument of policy change, and that
recipient governments needed to ‗own‗ their reforms themselves (Killick, 1998). This led to
691
the argument that conditionality ought to be abandoned altogether, and ‗selectivity‗ should
be adopted as a guiding principle in lending, with donors ‗selectively giving aid to countries
that already owned reforms that donors liked‗ (Lockwood, 2005:54). The shift from
conditionality to selectivity was staunchly advocated by the WB in its 1998 report titled
Assessing Aid, nicknamed the Dollar Report after its principal author (other WB publications
endorsing this shift include Collier and Dollar (1999) and Devarajan et al. (2001). This report
argued that ‗good‗ performers are better able to absorb and utilise aid and therefore
selectivity in aid disbursement is rationalised as the most ‗cost-effective‗ and ‗results-
oriented‗ strategy for donors.
This view was quickly endorsed by large parts of the donor community, and is practised
(albeit to differing degrees) by the WB, the US and Dutch governments and the UK.
Lockwood significantly observes that ‗while many donors have embraced selectivity, they
have not actually abandoned conditionality, but rather practise combinations of both‗
(2005:54). Yet, the idea that ‗good policy environments‗ mattered for aid to nurture reform
has unmistakably influenced donor thinking in recent years. More and more donors have
relied on the concept of good governance to guide their ‗selective‗aid allocations, but not
without difficulty, a theme to which we return in section two.
„Good‟ governance
The rise of the governance agenda served a very particular purpose for donors like the WB. It
allowed them to move away from a narrow focus on the market, an approach which had
proved to be disastrous through the 1980s, and engage more broadly with other types of
institutions as well. As discussed earlier, this is most visibly manifested in the launch of
broader conditionalities to do with political and institutional reforms. In this context, the
1997 publication of the WB‗s World Development Report (WDR) The State in a Changing
World signals an important epistemological landmark in the making of a new and very
powerful development discourse, i.e., the re-entry of the state into international development.
It argued that states must become ‗credible partners‗ in a country‗s development, and
wherein they lack the capacity to do so, such capacity can be reinvigorated. Precisely in this
definition, the Bank has carved a space for itself and other donors to get involved in the
broader internal affairs of recipient countries. This issue of state capacity has been interpreted
by and large in terms of institutional capacity, and ‗good governance‗ broadly associated
with the forging of various types of ‗desirable‗ institutional reforms. In one swift stroke,
therefore the emphasis on good governance appeared to acquit the WB and other
development organisations from accusations of the parochialism of the free-market idea.
2.2 Elements, Principles and Attributes of the Good Governance
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The rise of good governance has been understood as marking a departure from the theoretical
principles of the New Political Economy (NPE) that dominated in the 1980s, with their rather
negative views of the state as ‗predatory‗ and corrupt and correspondingly laudatory views
of the market as efficient and conducive to individual freedom (see Colclough and Manor,
1991; Nonneman, 1996). In fact, the current emphasis on governance reflects an astute
recognition of the limitations of NPE which assumes that transactions between economic
actors are relatively costless, and an endorsement of the New Institutional Economics (NIE)
which explicitly sought to explain how and why institutions were necessary in order reduce
these transaction costs that arose from the essential uncertainty characterising all human
transactions. Governance policies of the 1990s all focus on the centrality of institutions.
Doornboos (2000) comments that governance in this respect, is the latest in a whole series of
concepts that have been proposed to understand the institutional dimensions of state-society
relations and guide international development interventions (precursor concepts include
capacity-building, institution-building, institutional development, institutional reform etc.).
Governance is undoubtedly the most flamboyant of all these concepts, for it allows donors to
address matters broader than the government, to include various types of institutions from the
official state apparatus to market institutions, to institutions from the civil society or
voluntary sector, and all without explicitly talking about politics.
Nearly every active international development organisation in the world today sports its own
definition of good governance. These definitions are described as being ‗policy-oriented‗,
but a further distinction has been made on administrative-managerial and more limited
understanding of governance, as associated with the WB and a more political understanding
of the same as associated with western governments. He clarifies that while the latter
involves a concern for sound administration, it also includes an insistence on competitive
democratic politics. Yet, while this divide may have been conspicuous in the early 1990s, it
has increasingly narrowed over the years for two reasons.
Firstly, as discussed earlier, the WB itself has taken an explicit interest in the state and its
functioning, particularly in participatory decision making and democratically elected regimes
(apropos its 1997 report The State in a Changing World) despite retaining an overall
apolitical stance (Martinussen, 1998a). This is also the result of increasing pressures from
Western bilateral donors to address aspects of governance concerning the ‗form‗ of political
regime and not limit itself merely to the capacity of governments to design, formulate and
implement policies and discharge functions (Hyden et al., 2004:15). Secondly, the loaded
political overtones of the Bank‗s emphasis on the administrative and managerial aspects of
governance have been better exposed, with the recognition that good governance is a
‗function of state character and capacity which is in turn a function of politics‗. This has led
to increasing acceptance of the political character of ‗good governance‗, as exemplified by
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the growing practice of using democratisation as an explicit conditionality of aid (Barya,

1993; and Healey and Robinson, 1992; cited in Doornboos, 2000).
Good governance has 8 major characteristics. It is participatory, consensus oriented,

ccountable, transparent, responsive, effective and efficient, equitable and inclusive and
follows the rule of law. It assures that corruption is minimized, the views of minorities are
taken into account and that the voices of the most vulnerable in society are heard in decision-
making. It is also responsive to the present and future needs of society.
Participation
Participation by both men and women is a key cornerstone of good governance. Participation
could be either direct or through legitimate intermediate institutions or representatives. It is
important to point out that representative democracy does not necessarily mean that the
concerns of the most vulnerable in society would be taken into consideration in decision
making. Participation needs to be informed and organized. This means freedom of
association and expression on the one hand and an organized civil society on the other hand.
Rule of law
Good governance requires fair legal frameworks that are enforced impartially. It also requires
full protection of human rights, particularly those of minorities. Impartial enforcement of
laws requires an independent judiciary and an impartial and incorruptible police force.
Transparency
Transparency means that decisions taken and their enforcement are done in a manner that
follows rules and regulations. It also means that information is freely available and directly
accessible to those who will be affected by such decisions and their enforcement. It also
means that enough information is provided and that it is provided in easily understandable
forms and media.
Responsiveness
Good governance requires that institutions and processes try to serve all stakeholders within
a reasonable timeframe.
Consensus oriented
There are several actors and as many viewpoints in a given society. Good governance
requires mediation of the different interests in society to reach a broad consensus in society
on what is in the best interest of the whole community and how this can be achieved. It also
requires a broad and long-term perspective on what is needed for sustainable human
development and how to achieve the goals of such development. This can only result from an
694
understanding of the historical, cultural and social contexts of a given society or community.
Equity and inclusiveness
A society‗s wellbeing depends on ensuring that all its members feel that they have a stake in
it and do not feel excluded from the mainstream of society. This requires all groups, but
particularly the most vulnerable, have opportunities to improve or maintain their wellbeing.
Effectiveness and efficiency
Good governance means that processes and institutions produce results that meet the needs of
society while making the best use of resources at their disposal. The concept of efficiency in
the context of good governance also covers the sustainable use of natural resources and the
protection of the environment.
Accountability
Accountability is a key requirement of good governance. Not only governmental institutions
but also the private sector and civil society organizations must be accountable to the public
and to their institutional stakeholders. Who is accountable to whom varies depending on
whether decisions or actions taken are internal or external to an organization or institution. In
general an organization or an institution is accountable to those who will be affected by its
decisions or actions. Accountability cannot be enforced without transparency and the rule of
law.
What is also interesting is that the various definitions of good governance are similar in many
respects, but there are also a few critical points of difference especially in the way particular
principles are emphasised and prioritised. The WB‗s position on governance was first
outlined fully in a definitive statement in a report titled Governance and Development in
1992, where it defined good governance as ‗synonymous with sound development
management‗ (World Bank, 1992:1). This policy document focuses on four main areas of
public administration in general and public sector management in particular, which it
considers to be within its mandate:
a) Accountability – which in essence means holding officials accountable for their actions.
b) A legal framework for development – which means a structure of rules and laws that
provide clarity, predictability and stability for the private sector, which are impartially and
fairly applied to all, and which provide the basis for conflict resolution through an
independent judicial system.
695
c) Information – by which is meant that information about economic conditions, budgets,

markets and government intentions is reliable and accessible to all, crucial for private sector
operations.
d) Transparency – which is basically a call for open government, to enhance accountability,
limit corruption and stimulate consultative processes between government and private
interests over policy documents (Leftwich 1994: 372).
Following this definition, a number of other international organisations and donor agencies
came up with supporting definitions that closely resembled the World Bank‗s emphasis to the
extent that some or all of these principles were always included. However, they were not all
identical. It is instructive to consider a few of the following. The IMF sees itself as an
established advocate having and focuses on three key areas of governance, which are related
to its role of maintaining surveillance over macroeconomic management: the transparency of
government accounts, the effectiveness of public resource management, and the stability and
transparency of the economic and regulatory environment for private sector activity (IMF,
1997). To the Asian Development Bank (ADB), good governance is likewise seen as integral
to its strategy to reduce poverty and ensure the efficient management of resources in public
finances. This includes challenges of a constitutional nature that establish rules of political
conduct, creative interventions to change rules and structures, and the nature of interactions
and types of relationships between states, citizens and other actors. The ADB has identified
four critical objectives of governance to guide its work: accountability, participation,
predictability and transparency.
It concentrates its activities in a further eight areas of ‗good governance‗ practices, and these
include anti-corruption, corporate regulatory frameworks, legal and justice reform,
participation of the civil society in public decision-making, pro-poor service delivery, public
administration, public financial management and sub-national/local governance.
The World Bank, IMF and ADB‗s definitions concentrate on the quality of government in
providing efficient services and creating a stable environment for the working of the private
sector. Of the three, ADB is the only organisation that specifically mentions participation as a
core governance objective as well as an area of governance practice, but here too, the weight
of the emphasis (as evident from the majority of its governance practices) is not on
participation. We see a fairly different picture when we examine the definitions of good
governance of three other organisations: the Swedish International Development Agency
(SIDA), Canadian International Development Agency (CIDA) and the Office of the United
Nations High Commissioner for Human Rights (OHCHR). Each of these organisations
specifically relates its conceptualisations of good governance to democratisation more
broadly and to human rights in particular. For SIDA, good governance is a subset of
democratic governance, and is linked to issues concerning democracy, human rights, popular
696
participation and the principles of the rule of law (SIDA, 2007). As for CIDA, good
governance is described as the effective, honest and accountable exercise of power by
governments.
It is closely linked to human rights and democratisation on the basis that all three have
common underlying values, which include respect for human rights, justice, equity,
participation and accountability (CIDA, 1996). This latter set of concerns is most
unequivocally articulated by the OHCHR which endorses a rightsbased approach to
governance. Its underlying principles mirror those listed by CIDA, though
more explicit mention is made of non-discrimination, attention to vulnerability,
empowerment and the forging of links to international human rights instruments (United
Nations, 2002) The Department for International Development (DFID) has considerably
advanced thinking on governance with its 2001 Target Strategy Paper called ‗Making
Government Work for Poor People‗. DFID has zeroed down on seven key ‗governance
capabilities‗ that it believes that states need to develop, in partnership with the private sector
and civil society, in order to meet previously defined International Development Targets
(IDTs). The International Development Targets broadly classified into three categories –
economic well-being, social and human development and environmental sustainability and
regeneration – have been agreed by the entire UN membership, following a series of summit
meetings held by the UN and its specialized agencies over the past ten years or so.
These governance capabilities contain a fair mix of emphasis on issues related to the quality
of government and administration and the provision of a sound macroeconomic environment
(as associated with the WB, IMF and ADB‗s definitions) as well as with broader issues to do
with democratisation and rights-based development. These key capabilities are listed as
follows: a) operate political systems which provide opportunities for all the people, including
the poor and disadvantaged, to influence government policy and practice; b) provide
macroeconomic stability and facilitate private sector investment and trade so as to promote
the growth necessary to reduce poverty; c) implement pro-poor policy and raise, allocate and
account for public resources accordingly; d) guarantee the equitable and universal provision
of effective basic services; e) ensure personal safety and security with access to justice for
all; f) manage national security arrangements accountably and to resolve differences between
communities before they develop into violent conflicts; and g) develop honest and
accountable government that can combat corruption (DFID, 2001).
In subsequent years, and unlike many other donors, DFID has moved away from the ‗good
governance‗ agenda by focusing instead on the idea that each country has its own particular
agents, institutions and structures that drive change, and these need to be understood and
addressed. This notion lies at the heart of what it describes as the ‗Drivers of Change‗
(DOC), an analytical framework developed internally within DFID to enable it to ‗interact
with the politics of development‗ (Warrener, 2004:1). In practice, the DOC approach has led
to the commissioning of broad-based country-specific political analyses by DFID country
697
offices, with commissioned inputs from external consultants, to inform the development of
their country assistance plans (DOC Team, DFID 2006). Twenty two such studies have been
undertaken so
far, and there are attempts to conduct DOC studies in particular sectors, as for example social
protection in Zambia. However, while the DOC approach is conceptually savvy and has been
welcomed by DFID staff in many countries for its recognition of ‗political obstacles‗
(Warrener,
2004:5), it is unclear whether its sophisticated approach to governance will translate into
practicable lending strategies given the presence of various constraints faced by donors.
These include the presence of limited resources, need to produce clear outcomes and seek
wider public legitimacy (Chhotray and Hulme, 2008 for a comprehensive treatment).
A few other donors have tried to share DFID‗s brave conceptual attempt to locate ideas about
governance in the empirical realities of particular countries. Notable endeavours include
SIDA‗s ‗power analysis‗ and a multi-donor initiative within the Development Assistance
Committee (DAC) to understand better the political and institutional contexts shaping the
incentives of key actors. All these attempts reveal that donors are increasingly aware of the
‗very unsettling questions about the ―good governance‖ agenda‗, and of how little is
actually known about the ‗key causal linkages – between institutions and growth, growth and
corruption, democracy and poverty reduction – and about which reforms to prioritise in
different country circumstances‗ (Unsworth, 2005:9). The work of scholars like Goldsmith
(2003, cited in Unsworth, 2005) and Chang (2002) have been particularly influential in this
respect. They take a historical approach to question the ‗governance first‗ model of
economic development by demonstrating that this was never the case in developed countries
where institutions arose incrementally, in response to particular circumstances and crises.
While these initiatives are encouraging, they do not detract from the fact that the good
governance agenda in development remains largely identified with the valorisation of
predominantly western concepts and principles. Leftwich writes how this conception of
governance is ‗unexceptional, it re-identifies precisely the principles of administration that
have long been argued as being of benefit to developing countries…these are impeccably
Weberian in spirit‗ (Leftwich, 1994:372). Equally, it is hard to miss the very large range of
objectives (from anticorruption to human rights) encompassed within the concept of
governance, lending it a mysterious quality. And with larger numbers of donors embracing
selectivity in lending, ‗good governance‗, whatever it may be understood to be, is now
assumed to be present to begin with, and ‗bad governance‗, posed as the opposite of the
‗good‗, will remain so unless the recipient country is keen enough for aid to revise its
governance structures first (Doornboos, 2001; Martinussen, 1998b).
This in fact is the stated philosophy of the US Millennium Challenge Account, the Bush
administration‗s flagship big-budget scheme launched in 2002 at Monterrey. The key point
698
remains that there is a striking lack of clarity about the various aspects of its meaning
(Doornboos, 2000; Williams, 1996). Indeed, it could be said that the lack of specificity of the
governance idea has allowed it to be like a flexible carrier, which can be used to convey
varyingcombinations of messages, while appearing to be coherent and objective. This
‗elasticity‗of meaning, as Doornboos (2000) calls it, has been the precise strength of the
concept for donors and policy-makers. Others like Goran Hyden (1992) have argued that this
elasticity or flexibility
is what stands governance apart from other concepts and underpins its conceptual strength.
Hyden remarked that the advantage of the governance concept was that ‗it does not prejudge
thelocus of actual decision-making, which could be within the state, within an international
organisation or within some other structural context‗ (1992:6). Doornboos agrees that in this
regard, the governance concept ‗facilitates new analytical pursuits into the exercise of
political power, unhindered by formal boundaries, and may fit discourse analysis, embedded
structuralism and mainstream thinking alike‗ (2001:96). Little wonder then, that governance
has been richly assimilated within development parlance, both by its proponents and its
adversaries.
2.3 Good Governance and the Politics of Development
The impressive show of support for good governance by a vast array of international
development organisations and western governments might lend the impression of
consensus. There is hardly any doubt that the concept of good governance has been
extremely influential and pervasive for all the reasons discussed so far. But at the same time,
it is equally true that no matter how coherent development discourse appears to be around
good governance, there are major tensions that continue to splinter support for it. Each of
these tensions arises from the very political nature of the concerns that constitute governance
(indeed, problems arising from the exclusion of these concerns were what had led to the
focus on governance to begin with). The first relates to the question of method; how is
governance, so defined, to be implemented by donors, and in what ways governance criteria
can facilitate effective aid policy that meets its objectives. The second relates to the specific
governance concern with democratisation, and whether it is at all feasible to link donor
attempts at creating good governance with the constitution of democratic political systems.
There are disagreements both on whether it is at all right for donors to intervene in the
constitution of democracy as well as what might be the best way of doing so. The third major
area of debate and reflection involves the implications of popular governance related policies
for the role of the state.
Governance and Aid
699
The frustrating experience of implementing economic conditionalities through structural

adjustment in the 1980s led to the emphasis on political conditionalities through an emphasis
on good governance in the 1990s. But there was no reason to expect that implementing
political conditionalities should have been any easier, and very soon, it became evident that
implementation was anything but easy. There were a number of problems encountered by the
WB and other donors in this regard. One, these conditionalities were complex, comprising a
multitude of policy objectives, and there was no way to determine the extent to which it
would be possible to monitor compliance. Structural adjustment loans, which constituted
economic conditionalities, could have as many as 100 different policy instruments that
require complex and disparate policy change and involved conditions that that could not be
achieved in a short period of time. There was no way of checking hard-pressed developing
countries pledging commitment to undertake structural adjustment even when they had
absolutely no intention of doing so. Two, local reception of policy conditionalities, whether
economic or political, was intrinsically tied up with local political processes and
implementation frequently predicated upon bargaining with local political elites (see
Harrison‗s (1999) fascinating piece on conditionality and adjustment in Mozambique).
Donors increasingly realised that political conditionalities only introduced new
and unpredictable elements into the policy process and created very difficult situations for
donors and recipients alike (Doornboos, 2001). Donors were at risk of ‗getting further
enmeshed in the internal policy processes of recipient countries than they thought they had
bargained for‗ (Doornboos, 2001:102; Harrison, 1999). This was to be cumbersome and
difficult, and would lead to a strategic reorientation of donor policy, which has gradually
shifted since, from conditionality to ‗selectivity‗. As discussed earlier, this was expected to
save the donors from having to monitor attempts at ‗ameliorating‗ policy processes towards
‗good governance‗.
However, the move to selectivity brought with it its own set of problems, as donors still
needed to conceptualise what they regarded as desirable policy environments towards which
aid could be selectively directed. Countries which did not possess such environments, but
needed aid, would have to change and move towards this ideal. The US Millennium
Challenge Account (MCA) takes this principle to its logical extreme. MCA is a new foreign
aid programme announced by the Bush administration in 2002 designed to provide
substantial new foreign assistance to low-income countries that are ‗ruling justly, investing
in their people and encouraging economic freedom‗. Only countries that have successfully
demonstrated, largely through quantifiable scores that they meet all 16 indicators that have
been devised to satisfy these three criteria will be eligible to receive aid. These indicators
were supplied by organisations like the WB, Freedom House and Heritage Foundation. MCA
reflects a philosophy that has been clearly articulated by conservative think-tanks like the
Heritage Foundation that the failure of US overseas development assistance is not due to lack
of funding but because past governments had misdirected aid to governments with bad policy
700
environments, or in fact bad governance. MCA claims to be results-oriented and very tightly
monitored, but in fact, ‗the choice and construction of particular performance indicators;
their monitoring and measurement by neoliberal American and American dominated
institutions…problems with data accuracy and reliability‗ (Mawdsley, in press) have all been
vehemently criticised. Former World Bank economist William Easterly (2006) points out
how in June 2005 the MCA had reached agreements with two countries: Honduras and
Madagascar. Yet, in 2004, Honduras‗ government was ranked by the World Bank as among
the worst third in the world for corruption, while Madagascar was in the middle. MCA‗s
claims to neutral selectivity are also suspect on account of the inclusion of countries like
Colombia, Egypt, Jordan, Turkey and Russia in the pool of countries that are eligible to
compete for MCA funding, as this implies that decisions to award
MCA funds will be determined by political and strategic rather than the stated criteria. All
this illustrates the difficulties for external agencies to reach consensus on which countries are
better governed. In short, MCA‗s experience suggests that the move to selectivity shows that
donors continue to impose their ideas of what it means to be well governed on recipient
countries, and with limited degrees of success (see Chhotray and Hulme, 2007 for details).
Despite all the problems encountered during implementation, MCA remains in operation and
its proponents are optimistic that many of the ‗kinks associated with slow start-up‗ will be
ironed out (Herrling and Rose, 2007:1). Its reliance on universalistic governance criteria has
in fact facilitated the adoption of concrete, actionable strategies. These may well engender
more problems than they solve, and yet they continue as they are compatible with the general
framework of aid-giving and affirm dominant neoliberal economic values. In stark contrast,
DFID‗s Drivers of Change which attempts to formulate a more nuanced view of governance
has faltered to translate itself into practical strategies (Chhotray and Hulme, 2007). There is
also no concrete evidenc on the precise
ways in which DOC studies have impacted decisions regarding DFID‗s aid decisions.
Nevertheless, DFID appears to be taking its DOC initiatives seriously and has commissioned
further work to refine its analytical tools (see Leftwich, 2006). The debate on the role of
governance in giving aid reiterates the tension between difference and
similarity. There remains a very strong belief, especially amongst donors and international
development organisations that it is ‗possible in principle to search for universally valid
criteria of proper management and policy making‗ (Doornboos, 2000:72). Geoffrey
Hawthorn‗s insightful observation – that the notion of good governance is formulated in
terms of ‗optimal paths to optimal outcomes‗, a supposition which he rejects as simply
untrue in politics (1993:24) – is still not the favoured view.
2.4 Good Governance and Democracy
701
The concept of good governance has historically shared a strong association not just with
western models of government and administration, but more fundamentally with western
liberal democratic politics. The pro-democracy movements witnessed in parts of Latin
America, Africa and East Europe in the late 1980s and early 1990s led to an association
between multi-party democracy, western-style, and good governance. The subsequent use of
good governance based on political conditionality to forge similar or identical democratic
politics in countries around the world has been criticised as highly suspicious. The promotion
of democracy abroad is not a new policy for the United States, and while the Bretton Woods
institutions may have shied away from discussing democratisation as a specific governance
concern in the early 1990s, the Bank, reflecting the concerns of a number of western donors,
was much more willing to do so by the end of the decade (following WDR, 1997). More
recently, the UN and other bilateral donors (CIDA and SIDA for instance) relate good
governance explicitly with a broader concern for democratisation.
However, more than one critical observer has put forward the proposition that the new
political conditionalities (of the 1990s) had nothing to do with the desire for democracy, and
that a positive correlation between the two has yet to be demonstrated (Barya, 1993;
Cranenburgh, 1998; Doornboos, 2000; Healey and Robinson, 1992; Lancaster, 1993). To
begin with, in the post Cold War era, western countries frequently supported dictatorial
regimes, as in Zaire, Liberia and Uganda, under the label of ‗bulwarks against communism‗
(Barya, 1993:16). Barya forcefully argues that the new political conditionalities use a
‗populist ideology of democracy‗ to create a new economic and military world order
following the collapse of state socialism and the end of the Cold War (1993:16).
Moreover, western donors largely interpret democratisation as multiparty politics, and there
is wide scepticism whether this is either adequate or even appropriate to the needs of the host
countries. The majority of debates in this context have been played out in Africa. The skilful
manner in which authoritarian regimes in Kenya transformed themselves into dominant
parties within façade type multi-party systems showed that multi-partyism without
concomitant social
and ideological pluralism would ensure only a farcical democracy (Doornboos, 2001).
Cranenburgh comments, ‗It is highly questionable whether current reforms centring around
multi-party elections will lead to significant changes in the manner in which policies are
formulated‗ (1998:78). His concern is that political parties, multiple as they may be, may still
lack the capacity to present a coherent policy programme, failing both to provide credible
political opposition as well as allowing a dangerously large amount of autonomy to the
dominant party. For Cranenburgh, the appropriate response for the donor community would
be to formulate a ‗strategy to increase the capacity of democratising elites‗ (1998:78). He
702
even considers that such activities are better pursued by bilateral donors than by a ‗financial
institution‗ as the World Bank.
Others are less sanguine in their analysis. There is a fundamental questioning of whether
democratisation, as understood by the international donor community, is the appropriate path
ahead for Africa, and the developing world more generally. Countries like Uganda have
‗struggled to get recognition for an alternative to multi-partyism, arguing that multi-partyism
as it had evolved in the western experience did not necessarily constitute the sole route to
democratic political processes, or to ―good governance‖ for that matter‗ (Mugaju and
OlokaOnyango, 2000; cited in Doornboos, 2001:101). Hawthorn comments, ‗It is perfectly
possible that neither the government of a state nor the majority of that state‗s citizens
believes that the benefits of social cooperation are in fact best served by a competitive multi-
party system.
And it is perfectly possible that they could be right in that belief‗ (1993:26). Experiences in
parts of Africa (Congo) and East Asia (South Korea) have illustrated how competitive
electoral politics has posed a tangible risk to security and prosperity; both in Kinshasha (with
the civil war between 1960–65) and Seoul (with the factional disputes within the leading
party and the subsequent coup in 1960), security and the authority of the state to provide it
were at a premium.
While it may be true that ‗external threats‗ to nation-states are no longer as serious in the
1990s, and therefore ‗governments predicated on ―national security‖ were no longer
defensible‗, internal disorder or the threat of such disorder is still widespread (Hawthorn,
1993:27). The relationship between order and the success of democracy is now well
theorised. Przeworski concludes, ‗Democracy is about rules, not outcomes, and competing
parties will only accept defeat if they can be sure that the rules will stay in place and give
them a chance for victory in the future‗ (1991:1040). This observation supplements
Schumpeter‗s earlier proposition that ‗such rules will only be accepted if there is widespread
agreement on the general shape and direction of society‗ (Schumpeter, 1950; cited in
Hawthorn, 1993:27).
In this context, dissonances between donors, African governments and the African people
regarding the meaning of democracy and how it must be achieved emerge as a highly
pertinent, yet inadequately explored, concern. Donors project their interest in democratisation
as necessary ‗to ensure that repressed popular energies and misappropriated aid monies are
both released for development‗ (Barya, 1993:18), but this is not necessarily the perception of
African governments or African people for that matter. African governments and other
official African institutions like the United Nations Economic Commission for Africa
(UNECA) can be divided into two broad groups in this regard: those who favour democracy
but argue that it must not be imposed and its definition must be left to the African people
703
(some African leaders like President Museveni of

Uganda, the Organisation for African Unity and UNECA fall into this group) and those who
are opposed outright to democracy although they pay lip service to the concept (such as the
ruling regimes in Zambia, Kenya and Mali who have been forced to accept the multi-party
definition of democracy by a combination of the political conditionalities for aid as well as
internal resistance).
Attempts to capture the ‗popular‗ view of democratisation mainly convey the need to go
beyond a narrow interpretation of democracy as political pluralism, and focus on ‗its social
and ideological dimensions‗ making it as comprehensive as possible for the whole of civil
society (Mamdani, 1992; cited in Barya, 1993:20). Mamdani comments further that although
opposition movements and ‗new breed‗ middle class leaders are forced to acknowledge the
need for pluralism and autonomous organisations of civil society, it remains uncertain
whether they too would tolerate the‗militancy and autonomy‗ of these organisations if voted
into power. The social and ideological foundations of democracy remain a low priority for
donors as much as African leaders, old and new.
Support for the idea that democratisation need not follow a western liberal democratic model
has come more recently through an influential study conducted in 16 countries. Goran
Hyden, Julius Court and Kenneth Mease (2004) have drawn on a new set of data on
governance to provide a complementary perspective on democratisation and the relationship
between politics and development. The authors adopt a rule-based rather than a result-
oriented definition of governance. They define governance to ‗refer to the formation and
stewardship of the formal and informal rules that regulate the public realm, the arena in
which state as well as economic and societal actors interact to make decisions‗ (Hyden et al.,
2004:16). They further clarify that governance deals with the ‗constitutive‗ side of how a
political system operates rather than its distributive or allocative aspects that are ‗more
directly a function of polity‗ (Hyden et al., 2004:16). They identify six ‗institutional arenas‗
to understand and investigate the functional dimensions of governance: civil society, political
society, government, bureaucracy, economic society and the judicial system (for further
details refer to Hyden et al., (2004:22–28).
The results of their empirical research lead the authors to conclude that ‗development
stagnation and obstacles to democratisation stem from a failure to undertake the necessary
steps to establishing a system of rules that legitimate political choices and political
behaviour‗ (Hyden et al., 2004:193). They thus arrive at a rather different causal relationship
to that prescribed within conventional donor thinking: that the elements of ‗good
governance‗ (centring on the formal and informal rules that regulate the public realm)
provide opportunities for democratisation and development, and not the other way around,
where a western liberal form of democracy is advocated as the path to ‗good governance‗,
704
which in turn is vaguely defined. They clarify that ‗in this respect, getting politics right
means a set of normative and institutional changes that transcend the liberal democratic
model‗ (Hyden et al 2004:194). Their study includes examples of countries like China,
Thailand and Jordan, where development has been driven by an emphasis on rules that are
not identical to those associated with liberal democracy.
Governance and the State
The rise of good governance in international development is usually associated with marking
a clear break with the dominant neoliberal paradigm of the 1980s. The emphasis on
institutions of all kind, and not just market institutions, that it brought in its wake was seen as
representative of the ‗post-Washington‗ consensus (see Stiglitz, 1998).WDR 1997 The State
in a Changing World supposedly contained a more ‗balanced approach between the state-
managed and marketmanaged models‗ (Martinussen, 1998a). But to what extent did the good
governance agenda reverse the neoliberal state minimalism that had led to its rise in the first
place? This is a deeply significant question as the development orthodoxy relies heavily on
good governance to claim that it has moved beyond state minimalism.
Moore (1999) makes a powerful case that the neoliberal message is quite clearly evident in
the WB‗s 1997 report. The two ‗jobs‗ listed by the WDR for all states are firstly, to get the
‗fundamentals‗ right – these include the law, macroeconomic stability, investment in basic
services and protection of the environment, and secondly, to take advantage of the
opportunities represented by the private and voluntary sectors and not attempt to be the ‗sole
provider‗. Moore argues that the focus of this message is plain, and the WB desires states to
intervene to establish property rights, to maintain law and order and to preserve
macroeconomic stability but not to be the principal provider of health, education and social
welfare. The overall refrain in the report,
that states should not take on tasks that do not match their ‗capabilities‗, reflects the basic
neoliberal distrust of the state. These accusations are resounding and numerous: good
governance is hence viewed as the ‗political counterpart of economic neoliberalism‗ (Archer,
1994; cited in Orlandini, 2003:18), the extension of structural adjustment to the political
systems
of developing countries (Guilhot, 2000; cited in Orlandini, 2003:18), the promotion of a
neoliberalism on a national and global scale (Moore, 1999) and the ‗World Bank/IMF
consortium‗s last refuge‗ (George and Sabelli, 1996; cited in Moore, 1996:138).
The concern that has followed these accusations is that despite the theoretical departure to
new
institutionalism and the policy focus on increasing institutional capacity, actual governance
policies may paradoxically be doing ‗more to reduce, rather than strengthen Third World
705
governments‗ capacity for policy making and implementation‗ (Doornboos, 2000:72). Such
policies include for example, externally induced creation of autonomous institutions for
improved management that may undermine local government capacity or diversion of aid
flows to NGOs that may weaken the government departments charged with responsibility to
the areas concerned. This is not uncommon given key governance strategies of
decentralisation and the increased involvement of civil society. Moreover, demands for
compliance with contradictory instructions from different donors have been known to result
in confusion and distortion, in addition to overburdening qualified manpower which is
frequently in short supply (Doornboos, 2000; Wuyts, 1996). These processes have been
referred to as ‗squeezing‗ or ‗splitting‗ the state (Mackintosh, 1992) and seriously
undermine key governance objectives. Moreover, the continued pervasiveness of
neoliberalism offers ‗limited clues by way of policy on how to respond to the problems of
de-institutionalisation‗ that typically plague governance in developing countries (Bangura,
1994; cited in Doornboos, 2000:72).
In the same vein, the Bank has been criticised for subscribing to a narrowly economic
perspective which prevents it from considering seriously the developmental state model that
inspired the focus on governance (Martinussen, 1998a). The successes of state intervention in
development in several East Asian countries were also associated with other dynamics such
as the close nexus between the bureaucracy and major business groups. Such aspects were
never seriously regarded, even though they revealed critical aspects of the wider institutional
settings in which government bureaucracies in these countries operate. WDR 1997 contains a
few references to culture, history, informal rules and norms (1997:157), but aspects of
‗social embeddedness‗, as those referred to above, must be taken much more into
consideration in order to understand why governments behave so differently from one
another (Martinussen, 1998a).
Finally, it is alleged that proponents of the good governance idea do not adequately explore
the meaning and implications of the ‗developmental state‗, despite the significance of East
Asian developmental states to the whole emphasis on governance. Leftwich (1994) in
particular, notes that current models of good governance and the developmental state are in
conflict. This is because WB-led ideas of good governance are projected in depoliticised
terms, with little recognition that governance is in fact very much a function of state form,
capacity and political practice (Leftwich, 1994). He reiterates that the ‗remarkable‗
achievements of the East Asian states that have inspired the recent emphasis on governance
have ‗not been the kind of depoliticised governance now being urged on in developing
societies‗. Drawing from the work of other authors like Chalmers Johnson (1982) and Robert
Wade (1990), Leftwich (1994) makes the case that growth in East Asian societies has been
masterminded by ‗developmental states‗, that possessed the requisite autonomy to shape and
pursue nationally-determined development objectives. He also argues that developmental
706
states could be both democratic and nondemocratic, a point which contradicts the ostensible
consensus regarding the significance of democratisation for development by the proponents
of good governance. Obsession with the liberal democratic state thus leads to a patent
disregard for the varying social and cultural contexts that differently structure state-society
relationships.
Governance and power: The Central Concern
The critical element within development studies is underpinned by a view of governance as a

western construct that attempts to mask the power relationships between the developed and
developing world. The WB-led donor agenda of ‗good governance‗ is regarded as a
fundamentally ‗transformative‗ project that is presented as a depoliticised and neutral
endeavour. The following extract from a 1994 World Bank document reveals its grand plans
for governance:
‗Good governance is epitomised by predictable, open and enlightened policy making (that is
a transparent process); a bureaucracy imbued with a professional ethos; an executive arm of
government accountable for its actions; a strong civil society participating in public affairs;
and all behaving under rule of law‗ (1994: vii). According to Williams and Young, such
transformation is attempted at three levels: ‗at the institutional level with the creation of a
―neutral‖ state; at the social level with the creation of a ―liberal public sphere‖ or ―civil
society‖; and at the personal level with the creation of a liberal ―self‖ and ―modern patterns
of behaviour‖‗ (1994:99). Thus, at each of these three levels, the authors contend that the
World Bank constructs governance, in part at least, from liberal theory, and in the process, it
reproduces some important ambiguities and tensions that exist within it. It is perhaps
instructive to consider these attempts in turn.
The first level, i.e., creation of a ―neutral‖ state stems from the recurrent theme of separating
technical from political issues within the Bank‗s formal discourse. We have already
discussed how the Bank‗s interest in governance signals a formal departure from its stated
apolitical stand, and yet, the Bank has continued to retain its posture while engaging with
blatantly political matters. At a conceptual level, the very idea of a neutral basis of the
Bank‗s engagement with recipient countries stands to challenge, and indeed unsustainable
within liberal theory itself. The main point of criticism is ‗even if neutrality is taken as a
guiding principle rather than a foundational one, it generates neutralist conclusions only with
respect to those who already accept liberal principles‗ (Williams and Young, 1994:94). It
follows therefore, that the principles of ‗good‗ governance promoted by the Bank stem from
a prior conception of the good; the good for which the World Bank stands for is a market
economy and ―neutral‖ state which ensures the proper functioning of that economy by
means of the enforcement of property rights and contractual obligations.
707
The second level, i.e., creation of a ‗liberal public sphere‗ or ‗civil society‗ is among the
most innovative of the Bank‗s recent positions with respect to governance and development.
Indeed, there is a widespread consensus around the need for enlightened participation by civil
society in public decision-making. Traditionally, such a civil society was seen as a sphere of
interactions free of state interference and characterised by pluralism and tolerance and much
of the governance literature heeds the historically familiar liberal imperative of tolerance.
The Bank does not want to be seen as prescribing any particular political system, and its
official documents resonate with directives to its recipient countries to ‗devise institutions
which are consonant with its social values‗ (World Bank, 1992). However, on closer
inspection, it emerges that that not all forms of the indigenous are acceptable to the Bank and
its allies, and indeed only those that are compatible with modernisation are to be encouraged
(Landell-Mills, 1992). Although the Bank and other donors now rely on a rosy discourse of
‗partnership‗ and ‗ownership‗ by the recipient country, the actual experiences of their
dealings reveal ample contradictions. Mercer (2003) reports on how donors and international
NGOs in Tanzania ‗cherry-picked‗ a handful of elite NGOs to conduct their professional
interactions, while excluding the large majority of NGOs.
Moreover, the Bank‗s vision of the civil society is an explicitly western one, and there is no
space for ‗family and ethnic ties‗ or other ‗affective and community groups‗. Civil society,
as referred to within good governance agendas, includes ‗contractual, non-community, non
affective groups, such as professional associations, chambers of commerce and industry,
trade unions and NGOs‗ (Williams and Young, 1994:96). Social transformation along these
lines is explicitly suggested by the Bank‗s favoured academic experts as Goran Hyden
(1983). Williams
and Young (1994) argue that the Bank‗s selective tolerance can be better understood by an
examination of the underlying liberal assumptions. The liberal idea of a pluralistic civil
society stems from the fundamental liberal premise of the utter sanctity of individual
freedom. However, seminal liberal thinkers like J.S. Mill base their position on a highly
problematic distinction between those who are and are not autonomous (such as those
residing in ‗uncivilised‗ nations), sanctioning breaches of liberty of the latter (Williams and
Young, 1994). Liberal ideas of individual freedom are accompanied by highly
loaded notions of moral progress that mask their apparent universality. Attempts at
transformation at the third level relate to the individual itself and the liberal conception of the
‗free self‗ lies at the heart of good governance. This is particularly evident in the emphasis
on democratisation. Within liberal theory, the ‗characteristics of the individual agent, and
especially in relation to economic life, have been assumed to be universal underneath the
superficial variety of culturally conditioned behaviour‗ (Williams and Young, 1994:97;
Douglass and Bara, 1990).
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Such conceptions of universal economic behaviour have been extended to the political and
social realms as illustrated by the NPE approach to politics that continues to be influential
within the Bank and other donors. Western legal and bureaucratic organisations and the
market economy, that form the cardinal elements of the Bankled discourse of good
governance, are ‗premised upon the individual who has no other ―public‖ ties than the
contractual ones he chooses for himself‗ (Williams and Young, 1994:98).
While the good governance agenda allows the Bank and other international institutions to
pursue such fundamentally transformative projects, little or no emphasis is placed on
reorienting the external constraints to good governance as experienced by developing
countries. The gradual progression of the political conditionality approach from
‗conditionality‗ to ‗selectivity‗ has shifted the burden of responsibility for achieving good
governance from donors to host countries, but without any commensurate shift in power over
conceptualising its meaning. To conclude, it is precisely the understanding of power
relationships in governance that defines the divide between mainstream development
agencies and critical interpreters of development. As we have tried to summarise here, there
is a sharp divide in the literature between those who advocategood governance and those who
question it. To its proponents, good governance is a benign and universally applicable notion,
worthy of pursuit, but to its opponents, it is yet another instrument of power that the
developed minority continues to wield over the vast developing regions of the world.
Chapter Three
Theories of Governance
The processes of governance demand to be understood analytically and empirically as a set

of practices, rather than through the lens of a ‗wish-list‗ of principles to be followed. The
lists of
governance principles can be found providing some valuable food for thought (Hyden et al.,
2004; Kaufmann and Kraay, 2007). Governance theory helps to better frame an
understanding of how the processes of collective decision-making fail or succeed in our
societies.
3.1 Network Management Theory
One axiomatic statement provided by the governance perspective is that governing is about
the operation of networks of a complex mix of actors and organisations. As Rod Rhodes
(1997a) argues, initial work on policy networks – that focused on policy-making in particular
sectors of
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economy and society – gave way to a wider appreciation of the way that networks are central
for many of the elements of governing, including implementation (Hill and Hupe, 2002), to
the extent that many academics began to take the view that ‗governance is about managing
networks‗ (Rhodes, 1997a:52). The theory around the management of networks that has
emerged has been useful and insightful with descriptive and practitioner arms, although it
does have certain limitations in terms of the depth of causal explanation and clarity. So what
is it that governments do when it comes to steering networks? Kickert et al. (1999) and
Klijin et al. (1995) identify two broad types of management strategy: game management
and network structuring.
The first refers to the management of relations within an existing network and the second
refers to attempts to change the structure or participants in a network. The first type can
often involve government in the search for compromises to create the conditions for joint
decision-making. For example, a government body could call together all the relevant
interests in order to agree to a new form of regulation and in doing so bring about a beneficial
outcome that is recognised as such by all those interests. The second type of intervention is
more ‗hands-on‗ and involves changing relations between actors, shifting the pattern of
resource distribution and seeking to encourage a major change in policy direction. New
players are brought into the network and given legitimacy and resources that provide them
with the opportunity to influence the decisionmaking process and push for different outcomes
that would otherwise have emerged. In such a case a government agency might, for example,
bring a group of biology trained conservationists into an argument between residents and
developers over the regeneration of an urban park in order to get more expert input and a
more wildlife friendly outcome.
Kooiman (2003) makes a set of distinctions that in many respects parallel those discussed
above. He refers to „first-order‟ governing that deals with day-to-day management of
networks and to „second-order‟ that focuses on shifting the institutional conditions for
governing. The first might be seen as playing the game according to established rules and the
second more about setting the rules as different institutional arrangements will favour
different interests. But Kooiman goes on to identify a further category of „third-order‟
meta-governance. He suggests in a rather abstract way that meta-governing ‗is like an
imaginary governor, teleported to a point ―outside‖ and holding the whole governance
experience against a normative template‗ (Kooiman, 2003:170).It is difficult to be sure what
is meant by meta-governance in his work but it appears to rest on
debates about the best underlying principles for a governance system and judgements about
how any governance practice is living up to these principles. The point is that government
needs to step back and take a look at the overall state of the governing arrangements of
networks.
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This concern about managing networks has grown into one of the key sub-fields of the
governance literature and there has developed a debate around the concept of meta-
governance. The interest is in the way governments provide the ground rules and the context
in which governance takes place (Bell and Park, 2006). Sorensen (2006:100–1) suggests that
„metagovernance‟ is a term best reserved to describe any ‗indirect form of governing that is
exercised by influencing various processes of self-governance‗. She goes on to argue that
meta-governance is ‗an umbrella concept for the fragmented plurality of toolkits for
regulating‗ networks. A careful review of the literature on managing networks leads her to
identify certain regularities or patterns in the tools that are observed and practiced by
different writers.
Although as she notes it is not possible to offer a comprehensive guide Sorensen does offer a
useful framework to identify four main ways in which networks might be managed. They
are:
1. Hands-off framing of self-governance
2. Hands-off storytelling
3. Hands-on support and facilitation
4. Hands-on participation (Sorensen, 2006:101)
The last two forms of intervention identified by Sorensen are similar in many ways to the
direct forms of intervention identified in the earlier work on network management. They
involve state actors in game management by supporting and facilitating exchange between
network members or more actively joining the exchange in order to promote particular
interests or a particular outcome. What is more novel about Sorensen‗s list is the
identification of hands-off forms of network management.
The first of these hands-off forms – framing – captures a broad range of activities. It
includes facilitative legislation to give networks a general sense of direction but that leaves
its constituent organisations free to define their own paths and mechanisms for achieving
these goals. It also covers incentive-based measures that encourage organisations to
cooperate in a particular way. Crucially the state in both cases is acting in a hands-off way. It
is guiding and not dictating.
Formal goal setting and incentive structures are not the only way of influencing networks.
You can influence networks through narrative as much as through the harder tools of
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legislation and finances. Drawing on insights from Foucault and the work of March and
Olsen (1989, 1995) on the construction of democratic governance through the development
of identities and norms Sorensen suggests that storytelling is a second tool on network
management. She explains: Through storytelling, it is possible to shape images of rational
behaviour through the construction of interests, images of friend-enemy relations, and visions
of the past and possible futures for individuals and groups and for society at large. Hence,
storytelling represents a forceful hands-off means of influencing the formation of political
strategies among a multiplicity of self-governing actors without interfering directly in their
strategy formulation (Sorensen, 2006:101). The essence of the insight here is that networks
can be influenced and encouraged to view and understand their world in certain way and
through that activity they can be managed.
But in order to effectively manage networks argues Sorensen, managers and more
particularly politicians need to learn new skills of leadership. The argument that what is
required is new capacities in order to operate the world of network management is developed
by several other writers who seek to provide practitioner-oriented advice and theory.
Salamon (2001:1611) refers to the need to develop enablement skills to replace those of
traditional inside bureaucracy management skills. Unlike both traditional public
administration and the new public management, the ‗new governance‗ shifts the emphasis
from management skills and the control of large bureaucratic organizations to enablement
skills, the skills required to engage partners arrayed horizontally in networks, to bring
multiple stakeholders together for a common end in a situation of interdependence. He
identifies three core sets of skills. The first is activation skills, getting the relevant players
involved in helping to resolve problems. This role might involve getting enough ‗buy-in‗
from various participants in a scheme to promote environmental improvement or, on a more
hardnosed basis, ensuring that there is a dynamic market in producers of care services for the
elderly that can be established. In both cases a key requirement for the manager in the
context of network management is coaxing engagement by participants and more broadly
constructing an environment suited to the search for public value in which they can operate
(Stoker, 2006b). A second skill set identified by Salamon is the capacity to orchestrate in
order to help the various elements of any network more effectively to work with each other.
There are skills of diplomacy, communication and bargaining often involved in achieving
coordination (Rhodes, 1997b). Finally Salamon (2001:1611) suggests that what is required is
a modulation skill set.
Urban economic development specialists have referred to this as enoughsmanship – the

provision of just enough subsidies to get private parties to make investments in rundown
areas they might avoid, but not so much as to produce windfall profits for doing what the
developers would have done anyway. Inevitably, as we have seen, third-party government
leaves substantial discretion over the exercise of public authority and the spending of public
712
funds in the hands of a variety of third parties over which public officials have, at best,
limited control. In these circumstances, the central challenge for public managers is to decide
what combination of incentives and penalties to bring to bear to achieve the outcomes
desired. A key element of the last skill set is to remain sufficiently independent of the process
in order to provide the appropriate checks and balances.
In many respects it is the hardest of the skill requirements and demands a sophisticated
capacity for judgement and understanding of the position of other interests.
The ability to manage networks is a key theme in several management oriented works
(Kettl, 2002; Sullivan and Skelcher, 2002; Goss, 2001; Moore, 1995; Stoker, 2006b) and
Goldsmith and Eggers (2004:21–2) argue that for all types of public institutions ‗the skill
with which the agency manages networks contributes as much to its successes and failures as
the skill to which it manages its own public employees‗. They go on to note that managers‗
key tasks include having to align goals among partners; averting communication breakdown;
and overcoming data deficits and capacity shortages. The authors go on to provide a lot of
insights about how to construct partnerships that can be sustained and how to overcome some
of the dilemmas and tensions created by network public administration. But above all, the
key is a shift in the way that governing is conceptualised so ‗the idea of government based
on programs and agencies will give way to government based on goals and networks.
…public employees …will view their role as working out how to add maximum public value
by deploying and orchestrating a network of assets‗ (Goldsmith and Eggers,
2004:181).Managers are urged to ask if whether the public intervention that they are
directing is achieving positive social and economic outcomes; whether it is meeting the
challenge of public value (Moore, 1995). They do not have to directly provide
anything themselves necessarily. But even if acting directly, the assumption in network
management is that the outcomes are checked by stakeholders or more broadly consumers or
citizens. The touchstone for network-based governance is a different narrative of public
action that points to a motivational force that does not rely on rules or incentives to drive
public service reform but rests on a fuller and rounder vision of humanity. People are, it
suggests, motivated by their involvement in networks and partnerships, that is, their
relationships with others formed in the context of mutual respect and shared learning (Stoker,
2006b).
Network management theory has been successful in pointing to a different way of doing the
business of public administration. As a description of new ways of working, as a source of
ideas for managers and politicians, management network theory has considerable strengths.
Yet it has been argued that ‗network‗ is used in much of this literature as a metaphor
(Dowding, 1995) that enables writers to capture a sense of a different form of governance,
but the network concept and how best it should be analysed, remains somewhat problematic
and unclear. As Marsh and Smith (2000) argue in terms of policy outcome, it is unclear how
713
much explanation is down to the existence of a particular network, and what it is about that
network that delivers certain outcomes. They suggest that a number of elements need to be
taken into account if we are to understand the impact of networks: the context in which the
network operates, the network structure (for example how tight or loose it is) and the skills
and resources available to different network actors in their attempts to influence outcomes.
The interaction of these different lements is the key to understand how networks influence
policy.
Looking more at the impact on public administration Provan and Milward (2001:415) argue
that despite the promise of networks, the absence of rigorous assessments mean that it is still
‗premature to conclude that networks are effective mechanisms for addressing complex
policy problems‗. They suggest that the overall effectiveness of networks needs to be judged
against three broad questions, each offering a different level of analysis. First, does the
network deliver outcomes that are valued by society and its representatives? Second, does it
deliver sustainable relationships among a set of partners? Third, does it enable individual
agencies to survive and continue to construct their futures in a way that is beneficial to them
and wider societal interests?
In short, does it work for the community, as a network and for its participants?
The answer to each of these questions may be different but as Provan and Milward suggest
this challenge should not put analysts off the task of judging the performance of networks
rather than simply advocating them as the new way of governing.
3.2 Theories of delegation
If network theories argue that the key governance task is to manage networks effectively,
then delegation theorists argue that key to effective governance is getting the structure of
delegation right. When incentives are appropriately aligned then the desired outcome can be
achieved is the basic assumption of delegation theorists. As Bertelli (2006:10) comments
‗delegation is at the heart of new governance reforms‗ as powers and responsibilities are
shared between a range of agencies and as understanding how delegation works could
provide a key element in understanding the operation of governance. The style of theorising
tends towards the formal rather than the informal in contrast to network management theory.
Moreover the emphasis is on generating insights from parsimoniously specified models that
are subject to empirical testing insofar as that is possible in ‗real world‗ settings.
Theories of delegation start from a premise that is shared with principal–agent theory that
the boss (or principal) is engaged in a ‗non-cooperative‗ game with a subordinate (the agent).
The boss can either delegate or not and the agent can either shirk or work; or to be put it less
pejoratively ‗the subordinate can either act in a way that is good for the boss or not‗ (Bendor
714
et al., 2001:236). Thinking formally about the dynamisms of delegation in this manner helps
to indicate why achieving effective delegation in the world of governance can be difficult.
Starting with the classic principal agent assumptions of non-cooperation between principal
and agent and then recognising that the power to direct is in the hands of the boss but a
possible information advantage in the hands of the agent as they are the person with direct
involvement, it is possible to see delegation as a delicately balanced game. The issue
becomes: ‗is the gain produced by delegating the decision to a more informed party worth
the loss produced by having someone with different preferences make the choice?‗ (Bendor
et al., 2001:242).
This stripped down version of the model can then have several ‗what ifs‗ added to it. What if
the agents started to volunteer to take on delegated tasks – how would that affect the game?
What if there was a more intense conflict between boss and agent would the boss ever be
able to delegate? What if there were multiple agents (some of whom might be tempted to free
ride) multiple principals that might have some, but potentially cross-cutting, scope to control
the agent?
But delegation theory does not just stop there and it would be disappointing if it did. As well
as signalling the complexity of delegation arrangements, it also identifies a number of ways
in which delegation can be effectively managed. One option, of course, is for the principal
to impose sanctions after the event once something has gone wrong and the agent has stepped
out of line. The delegation literature is clear about how costly this method is, in that it
requires a lot of monitoring effort in the context of information asymmetry, and could be
potentially damaging to the reputation of both principal and agent in the future. But there are
other ways in which control can be exercised other than extensive monitoring and oversight.
One option that appears to have stood up well in delegation studies is what Bendor et al.
(2001:259) refer to as the ally principle – that a boss prefers subordinates who resemble
herself ideologically‗. Where such over-arching selection procedures cannot be put in place
there are other ways to constrain the discretion of agents. McCubbins et al. (1987) suggest
that principals often engage in ‗deckstacking‗ in order to increase the likelihood of agents
choosing outcomes they prefer. They use administrative rules to set broader rules of the
game: how the agency can make a decision, which interests it needs to consult and the speed
at which it can be allowed to make decisions.
The principal‗s control can further be enhanced by installing recall mechanisms to ensure
that if an agency makes a decision that is out of line with the principal‗s thinking, it has to
reconsider. Thus, an agency can be given quite broad legislative remits (and also have the
advantage of flexibility) but an environment can be created in which they are more likely to
make decisions in tune with the perspective of the principal.
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A key message from delegation theory is that if political principals lack the time and
resources to supervise their permanent appointees, they can regulate bureaucratic discretion
through their access to rule-making institutions. Bureaucrats, on the other hand, usually
must work with the system as they find it. Epstein and O‟Halloran (1999) and Huber and
Shipan (2002) in careful empirical work emphasise the choices legislators face when
designing delegation systems. In particular, the tightness, or otherwise, in the framing of
legislation is seen as the way politicians seek to exercise control over bureaucracies. If
politicians give bureaucrats freedom of manoeuvre through the vagueness of statues, officials
may ‗adopt policies that they prefer and do little to serve the interests of politicians‗ (Huber
and Shipan, 2002:222). Alternatively, the right amount of restriction over discretion can
deliver desired outcomes for the politicians; but they must be careful not to tip their design of
statutes to encourage non-compliance.
The evidence presented suggests that politicians in the United Congress have not too bad a
record at developing the right sort of delegation mechanisms for different agencies. If the
argument applies to political-bureaucratic relationships generally, as well as in the context of
the US Congress and in key western European legislatures, politicians should be free to
organize political institutions in their interests, revealed by the particular schemes of
delegation that appear in various contexts across the world, whether at the national, state or
local levels (Huber and Shipan, 2002:10).
There is one particularly interesting variation identified in the literature in which the key
objective for the principal is to set up an agency that will not be seen as ‗kow-towing‗ to
their interests and whims. The aim of this game is to establish credible commitment (see
Bendor et al., 2001:259–265), a propensity to act in a certain way and to keep acting that way
as time unfolds. The most well known example is that of delegating control over the money
supply and interest rates to an independent decision-making body to insulate it from short-
term political interests. It is given responsibility to set the money supply levels and interest
rates for the long-term health of the economy. The principal creates an insulated form of
delegation that keeps her away from the decision, but still does a job for her in that it delivers
a credible commitment that decisions are going to be made in the long-term public interest.
Another factor in the principal‗s thinking might be to install a decision-making procedure

that cannot be easily unravelled by political opponents when they gain power at the expense
of the currently dominant principal. Thus, for example, a highly independent environment
protection commission might be set up – free from day to day political lobbying – in order to
ensure that even when out of power the principal could be reassured that environmental
issues will have a strong promoter and protector. There are of course costs in such a strategy
– in that a rigid and inflexible agency might result in being unable to adapt to new demands
716
and circumstances. In summary, much of the delegation literature is relatively optimistic

about the possibility of ‗smart‗ design solutions to the problem of how to
delegate effectively and thereby keep a complex system of governance under the direction
and influence of political principals. The implication of the literature is that democratic
politicians can if they delegate deliberatively and responsibly see ‗the will of people‗ as they
interpret it put into practice despite the complexities of modern governance.
The formal nature of theorising enables a number of hypothetical or simplified solutions to
be explored but what is not so clear as even its advocates concede is that the method enables
the effective exploration of real-world institutions and decision settings with all their
contradictory and confused practices and their context of past decisions and present
commitments (Bendor et al., 2001:266–267). Does delegation theory really allow for the
sheer messiness and multiple interpretations and understandings that characterise action and
inaction in the world of governance?
3.3 Social Interpretive Theories
Social interpretive theory differs from the delegation literature not as is sometimes suggested
(March and Olsen, 1989), because it takes institutions seriously – that it is a characteristic
shared between the two schools – rather the key difference is that it develops a more complex
and nuanced perspective on how individuals and groups respond to the challenges and
difficulties of governance. While delegation theory assumes that people respond rationally
to a given set of incentives created by institutional rules that are universally perceived and
understood, the social interpretive literature takes as a starting point that people interpret
the world differently and that social and political communication is far from
straightforward and is rather the greatest challenge of governance. As Janet Newman
(2001:6) argues, to understand governance requires an emphasis on ‗the way in which social
arrangements are
constructed as a result of the production of meanings and the repression, subordination or

coordination of alternative meanings‗.
Bevir (2003) criticises institutionalist approaches such as those developed by delegation
theory
because they assume that you can develop procedures or rules to steer the behaviour of
subordinates. A principal may construct a rule Y for people in position X and expect
behaviour Z as a result. But ‗people who are in a position X might not grasp that they fall
under rule Y, or they might understand the implications of rule Y differently from us, and in
these circumstances they might not act in a manner Z even if they intend to follow the rule
(Bevir, 2003:206). In particular, the model builders of delegation theory start with the
assumption that people are self-interested, but then make further assumptions as to what
might be in someone‗s self-interest in a particular context. These arguments are made to
717
sound natural, obvious and even selfevident, but all they are simply guesses by the analyst.
Bevir (2003:206) comments that ‗we cannot blithely assume that bureaucrats understand and
judge their institutional context as we do‗. Without exploring people‗s beliefs and
perceptions there cannot be any adequate explanation. Bevir (2003:200) argues for ‗a
narrative approach …that unpacks human actions in terms of the beliefs and desires of
actors‗. To explain people‗s actions you need to invoke their
beliefs and desires by exploring the ways in which they understand their location, the norms
that affect them and their values. But importantly he notes ‗people cannot have pure
experiences, their beliefs are saturated with contingent theories‗ (Bevir, 2003:205). Political
scientists have the task of understanding these beliefs and desires and this is best done by
interpreting them ‗by relating them to other theories and meanings‗ (Bevir, 2003:205).
People live and work in the context of traditions and these traditions prompt them to adopt
certain meanings and when dilemmas occur they may modify their traditions and beliefs. In
summary Bevir (2003:211) ‗encourages us to understand governance in terms of a political
contest resting on competing webs of belief and to explain these beliefs by reference to
traditions and dilemmas‗. Above all, as Bang (2003:7) emphasises, it is important to view
governance as a ‗communicative relationship‗. Governance, in particular, calls to attention
relationships that are not articulated through formal authority. Governance relationships in
the context are seen as driven by processes of exchange between governed and governors that
are going to have to be open, developed and reflexive. Relations between state and citizen
and between citizens are in a state of constant ambiguity and new more engaging and flexible
forms of governing will have to be developed.
For the social interpretative school, all social life is negotiable and governance, if it is to be
effective and legitimate, will have to self-consciously take that form. ‗A more interactive,
negotiable, dialogical and facilitative authority is …needed to help people in governing
themselves‗ (Bang, 2003:8).
3.4 The Bounded Rationality School
The ‗bounded rationality‗ school is one of the least developed in its application to
governance issues, but we argue it has much to offer. The school is strongly associated with
the work of Herbert Simon drawing on crucial insights that come from the cognitive
psychology (Simon, 1985). The school has expanded to include a wider understanding of the
practices and heuristics involved in human decision making (for a brilliant over-arching
review see March, 1994). Bendor (2003) suggests that while some studies indicate how well
humans cope with decisionmaking challenges; others (see in particular the work of Tversky
and Kahneman, 1986) concentrate on systematic flaws in human judgement. Some heuristics
are seen as providing effective ways of coming to a judgement – „better than
718
comprehensive rationality‟– and others are seen as having in-built pathologies or

weaknesses (Bendor, 2003). Jones (2001) follows in the footsteps of Simon by exploring not
only psychological insights into decisionmaking but also the role of social institutions in
correcting and channelling the decision-making of humans. It is his work, in particular, that
helps us to recognise the importance of this perspective for our understanding of governance.
The thinking of the bounded rationality tradition starts with the same assumption as rational
choice – that the people are goal-oriented, but accepts, like social institutionalists, that goals
may reflect selfish but also other motivations, where it is distinctive in its understanding of
the process of selection that individuals go through. The strongest objection to the micro-
foundations of the rational choice school from the perspective of bounded rationality is that
they are ‗behaviorally flawed‗ (Jones 2001:208). Effective analysis requires micro-
foundational assumptions that are not ‗off-base‗ and an understanding of how humans
develop adaptive responses framed by complex institutions (Jones, 2001:208). Rational
choice theorists – such as those discussed above in the examination of delegation theory,
give agents fixed preference rankings and argue that incentives will steer their choices given
the desire to maximise their utility. Bounded rationality suggests that the process of choosing
what to do is more complex because there is a fundamental human problem in processing
information, understanding a situation and determining consequences given the limits of our
cognitive capacities and the complexities of the world we operate in. ‗Humans are goal
directed, understand their environment in realistic terms, and adjust to changing
circumstances facing them. But they are not completely successful in doing so because of the
inner limitations.
Moreover, these cognitive limitations ‗make a major difference in human affairs – in the
affairs of individuals and in the affairs of state and nation‗ (Jones, 2001:27). Decision-
making is conditioned by the framing features of the human mind and the organisational
context in which people operate in complex ways.
The possibility of using this tradition as a counter-weight to the rational choice school in
research has been recognised by several writers including Moe (1984), Jones (2001) and
Bendor (2003). It is at the level of critique that the approach currently has most to offer.
Again, reflecting on the work on delegation theory discussed earlier in the chapter, the
bounded rationality approach would argue that the approach is erected on an insecure
platform. Delegation theory drawing on its rational choice roots assumes that incentives
shape human action in a straightforward way: the opportunities and constraints in the task
environment determine an individual‗s effort towards goal accomplishment. That is why
incentives work – and why a combination of ‗targets-and-terror‗ should deliver for
reformers. The trouble is, as Herbert Simon (1997) and other theorists of bounded rationality
point out (Jones, 2001), for individuals to respond in the manner required by the theory,
assumes that decision-making on the part of humans is a rational response to external stimuli.
719
The decision maker, it is postulated, comprehensively perceives the environment and weighs
up options against her preferences in the context of incentives and constraints, and chooses
the option that maximises her preferences.
However, the advocates of the bounded rationality model argue that that is a misleading
picture of decision-making. Decision-makers, as it were, have to deal both with the external
environment and their inner world, their cognitive architecture. The inner world helps them
to focus on some things and ignore others and it is driven by habits of thought, rules of
thumb, and emotions. Rationality is ‗bounded‗ by this framing role of the human mind.
Insights from social psychology and cognitive studies suggest that actors develop various
coping techniques and heuristics to deal with the decision from challenges they face.
As Jones (2001:194) argues ‗a major reason that institutional reforms fail to perform as well
as expected is that designers do not pay enough attention to how the incentives they create or
alter are likely to be perceived by participants in the institution‗. Bounded rationality
principles tells us that agents will selectively search based on incomplete information and
partial ignorance and terminate that search before an optimal option emerges and choose
instead something that is good enough. To understand the behaviour of such a decision-
maker it is necessary to know what they know, what they want and what they can compute.
We need considerable empirical information about the decision-maker and cannot assume a
response on the back of assumptions about their capacity for rational calculation is driven by
a set of ranked and fixed preferences. This is not to say that the behaviour of agents needs to
be judged as irrational. On the contrary, they are rational in the sense that their behaviour is
generally goal-oriented and usually they have reasons for what they do (cf. Simon, 1985). It
is just that their rationality may be very different to that of the principal and rests on the
interaction of their cognitive structure and the context in which they are operating. The
bounded rationality school provides a number of insights into
governance failure and why steering by government in the context of governance is a
challenging task. First, the perceptions of actors of their task and role are not easy to
change.
They are likely to be defined in different ways according to previous definitions of the
problem space which has been essential in enabling them to selectively attend to the
management of tasks and meet the challenge of information overload. These perceptions of
what to care about and what not to care about are reinforced in the rules and operating
procedures of organisations and people may have developed an emotional attachment to them
and a loyalty to their part of the organisation. These attachments can block reform efforts.
Finally, in coping with past reform programmes agents may have developed heuristics that
are undermining or distorting of reform messages. There is the potential for the school to
move beyond critique to a stronger sense of what could guide institutional processes in the
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context of governance. Models of how humans behave matter, because they inform not only
the thinking of social scientists, but also those of policy-makers.
The bounded rationality framework draws to attention three understandings.

First, the challenge of communication comes to fore in a world where ‗can‗ and ‗do‗
regularly misunderstand one another rather than a world where communication is cost and
problem free. Second, bounded rationality argues that information processing practices and
heuristics will need to be addressed rather than the issue of information asymmetry in any
governance arrangement. Third, bounded rationality accepts that individuals can be minded
to cooperate with others rather than automatically behave in a self-interested and egotistical
manner. Could bounded rationality provide a better framework for thinking through policy
and governance arrangements or reform programmes?
Its message is interpreted by some (Ostrom, V., 1997) to be that all humans are
fundamentally flawed decision-makers and we need to design institutions with extensive
checks and balances and very limited spans of responsibility set within a framework of
limited government. That is not a path we find either attractive or inherent to the adoption of
a bounded rationality frame. What the framework suggests is that people are flawed, but
often still effective decision-makers. If you add to that point the understanding that humans
are naturally inclined to cooperate, at least as much as they are to hinder one another, then
scope for effective governance is wide.
Reformers would focus on how interventions could shape how attention is paid and to what
issues; how the problem space is represented, defined and understood by actors; the role of
heuristics in controlling the search for alternatives and options for action and the impact of
emotional attachment and loyalty on the framing of the decision-making environment. The
major challenge is responding to the impact of our limited cognitive architecture as both
reformers and active decision-makers in the governance arena.
3.5 Cultural Institutional Theory
The cultural institutionalist school we argue also has much to offer to our understanding of
modern governance (Hood, 2000; Perri 6 et al., 2002; Verweij and Thompson, 2006). The
school may offer the prospect of incorporating insights neglected by rational choice but at the
same time appears capable of offering sufficient ‗analytical efficiency‗ (Grendstad and Selle,
1995:6) to provide a guide to institutional design. The starting point of cultural institutional
theory is to recognise, as rational choice theory does, that individuals are active, creative
thinkers but it sees them as more deeply affected by their social context than rational choice
allows. People are not only influenced by social relations that permit or constrain their
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choices but they adopt socially influenced principles to guide those choices; principles that
can be ‗used for judging others and justifying‗ themselves to others (Douglas, 1982:190).
Social relations and justifying cosmologies or world views are central to the context for
individual decision-making. Social relations and world views combine together in ways of
life or cultures.
From the perspective of cultural institutional theory people‗s interests are the product of
social relations and the ‗origins of their preferences may be found in the deepest desires of
all: how we wish to live with other people and how we wish others to live with us‗
(Wildavsky,1987:4). As a result ‗preference formation is much more like ordering prix fixe
from a number of set dinners or voting the party ticket. Only those combinations that is
socially viable, that can cohere because people are able to give them allegiance, to share their
meanings, may be lived‗ (Wildavsky, 1987:4). People‗s preferences and their management
strategies to realise these preferences, are shaped by ways of life. Bounded rationality work
allows for the development of schemas and heuristics, tacit theories about the world and the
way it works, which are used by individuals to ease decision-making in the context of a
complex environment and a corresponding complex array of strategic responses. But cultural
institution theory sees these decision-facilitating devices as not purely cognitive but also as
socially influenced: ‗mental activity is embedded in and justifies social relations‗ (Thompson
et al., 1990:58). People use cultural biases to help them to
determine for people what they want, who to blame, when to take risks, when to be apathetic,
all central concerns of the governance dynamic. As Thompson et al. (1990:59) comment:
These cultural biases – the shared meanings, the common convictions, the moral markers, the
subtle rewards, penalties, and expectations common to a way of life – that become so much a
part of us are constantly shaping our preferences in ways that even the brightest among us are
only dimly aware.
Crucial to delivering analytical efficiency, cultural institutionalists argue that only certain
cultures – combinations of social relations and world views – occur sufficiently regularly
in human society to suggest that they are sustainable. ‗What makes order possible is that
only a few conjunctions of shared values and their corresponding social relations are viable
in that they are socially liveable‗ (Wildavsky, 1987:6). To specify what those combinations
are cultural institutional theory, following the pioneering work of Mary Douglas (1982:190),
uses the concepts of group and grid to specify ‗a full array of possible social structures‗. The
question underlying the concept of group is: who am I? The question underlying the concept
of grid: what shall I do? As Wildavsky (1987:6) explains:
The question of identity may be answered by saying that individuals belong to a strong
group, a collective, that makes decisions binding on all members or that their ties to others
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are weak in that their choices bind only themselves. The question of action is answered by
responding that the individual is subject to many or few prescriptions, a free spirit or a spirit
tightly constrained.
The strength or weaknesses of group boundaries and the numerous or few, varied or similar,
prescriptions binding or freeing individuals are the components of culture.
Social relations repeatedly are institutionalised in a small number of forms, reflecting the
limited positions available on the grid/group frame. You either experience a strong
membership of a group or you do not. Your world is either subject to a lot of rules and direct
regulation or it is not. Grid group is about you as an employee in a large organisation (a role
holder in a hierarchy); you as a hospital patient (a fatalist in the hands of others); you as a
consumer (an individual
making choices) and you as a church member (you as a communitarian). As the above
illustrations indicate, an individual may find himself shaped by diverse social relations in
different settings. What brings home the relevance of cultural institutional theory to
governance is its recognition of how these patterns of social relations in which individuals
are embedded in help to determine their choices and in turn enable people to make decisions
in the context of limited information and extensive complexity. The social framing measured
by the grid-group framework provides people with a heuristic, a way of making sense and
shaping a response to governance dilemmas. Crucially the social filters provide not just
values but also decision rules.
These social filters ‗enable people who possess only inches of fact to generate miles of
preferences‗ (Wildavsky, 1987:8). People know what to do because they know who they are
and where they are located. Rational people support their ways of life. But whereas for
rational choice theory there is only one ‗rationality‗, for cultural institutionalists there can be
up to four.
Consider the case of an intervention operating in a professional setting, then a governance

solution that went with the grain of the dominant institutional way of working and thinking
might be more effective. The professional setting can be taken as strongly influenced by the
‗communitarian‗ framing of social relations with a social structure built on fellowship and
inward-looking, respect for all members and a value stance that rests on affirmation by peer
group. Thus rather than impose rigid rules or set about giving professionals individual
incentives to change, you might instead seek to incorporate some members of the
professional group in your project and then let their leadership create followers and adherents
among the professional group. One illustration of this tactic might be the way that leading
doctors have been appointed as for example anti-cancer ‗tsars‗ in the UK‗s NHS to promote
best practice and more effective forms of treatment.
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In this way the inherent culture of a social setting is turned to the advantage of top-level
hierarchical decision-makers and may aid them in achieving their over-arching goals. One of
the most useful insights offered by cultural institutional theory is that it enables the analyst to
be clearer about the variety of governance options available in any one setting. Moreover the
gridgroup framework can be given another twist, like a microscope in a laboratory,
magnifying its focus to examine each of the quadrants in more depth (Hood, 2000). The
approach could also be extended to apply to the other quadrants. As a heuristic device it is
valuable in suggesting ways of governance that might be appropriate in particular settings.
Moreover as Hood (2000) argues cultural institutional theory offers the designer a wider or
fine grained selection of governance tools. But more than that as a design principle cultural
institutional theory holds that that a sustainable governance system needs to have a requisite
variety of coordination mechanisms drawing on each of the solidarities or cultural forms
outlined above.
3.6 Systems Theory
A system is a complex arrangement of elements related to a whole. The body, for example, is
a whole that is comprised of a complex of interacting cells, organs, limbs, and so on. The
study of society as a social system has a long history in the social sciences. The conceptual
origins of the approach are generally traced to the work of Herbert Spencer and Émile
Durkheim in particular. Herbert Spencer, influenced by Charles Darwin‗s theory of
evolution, argued for a unitary form of the social system. In his approach, the system of
society was constantly evolving into an even more complex state of perfection. However,
alternative forms of social systems theory argue for a very different view of social evolution.
In these perspectives, society is not evolving toward some perfect state; rather, it is reaching
a state of increasing complexity. This was called structural differentiation. Structural
differentiation refers to the adaptation of the organism or society to its environment through
changes in its internal complexity. An important aspect of social differentiation is deciding
just how adaptation occurs. Put simply, the question is, How do
changes in the structure of the system relate to the processes of the system?
There are several solutions to this problem. On the one hand, society can be viewed as a total
organism that is sustained by the various processes that comprise it. An alternative view
argues that stabilizations in social systems occur not because of any rational plan of overall
survival, but simply because they happen to work. These differing views of society have been
labeled structural functionalist and functional structuralist, respectively. Other forms of
systems theory include the actor systems approach and the socio-cybernetic perspective.
Systems theory is relevant to governance because it is involved in analyzing how society
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adapts to its environment through adjustments in its structure. The problem of governance
from this perspective becomes the problem of reaching an adequate understanding of the
complex processes of social evolution. If social systems theory were followed, governance
would become preoccupied with eliminating inadequate social control and reducing
deviance. The problem of steering becomes the problem of recognizing that society is multi-
centered and formed on the basis of a multiplicity of coevolving systems. Systems theory
carefully outlines that there are very real limits to our ability to steer society. On the other
hand, because society is so complex, the social scientist can, nonetheless, have an
appreciation of the large range of adaptive possibilities for social systems.
3.7 Regulation Theory
Regulation theory is a distinctive paradigm in critical political economy. It originated in

Europe and North America in the 1970s in response to the emerging crisis of the postwar
economy and its mode of regulation, and it has since been applied to many other periods,
regions, and contexts. Its name derives from its French originators, who describe it as la
théorie de régulation (the theory of regulation) or l‘approche en termes de régulation (the
approach in terms of regulation). Similar ideas were developed by other schools.
Their common core concern is the contradictory and conflictual dynamics of contemporary
capitalism considered in terms of its extra-economic as well as economic dimensions. In
highlighting the latter, regulationists engage with other social sciences. One such affinity is
with work on governance, especially economic governance. Indeed, regulation theory has
been seen as the European equivalent of American institutionalist interest in macroeconomic
and sectoral governance. This is overstated because there are important theoretical
differences rooted in the Marxist background of the regulation approach and its focus on the
logic of capitalism rather than the broader issues studied by governance theorists.
The various regulation schools examine the role of extraeconomic as well as economic
factors in securing, albeit for limited periods and in specific economic spaces, what they
regard as an inherently improbable and crisis-prone process of capital accumulation. Overall,
while well aware of the invisible hand of market forces in this regard, they also explore how
extra-economic factors embed profit-oriented, market mediated capitalist production in the
wider society and help to tame, displace, and defer its contradictions and class conflicts. This
process is associated with alternating periods of relatively stable expansion and crisis induced
restructuring, rescaling, and re-regulation. Capitalism is deemed so contradictory and
conflictual that crises will periodically trigger a trial-and-error search to find new ways of
regularizing capitalist expansion.
This provides the basis for regulationist work on different stages and varieties of capitalism.
Starting from real social relations in specific historical periods rather than from the abstract,
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transhistorical, rationalist assumptions of orthodox economics, all regulation schools largely

share four goals:
(1) describe the historically specific institutions and practices of capitalism,
(2) explain the various crisis tendencies of modern capitalism and likely sources of crisis-
resolution,
(3) analyze different periods of capitalism and compare their respective accumulation
regimes and modes of regulation, and
(4) examine the social embedding and social regularization of economic institutions and
conduct through their articulation with extra-economic factors and
forces.
These goals provide potential links to research on governance. Governance theorists often
distinguish among the invisible hand of the market (exchange), top-down management
(command), reflexive dialogue and deliberation among equals with different but
complementary interests (networking), and unconditional solidarities based on identification
with a (real or imagined) community. Regulationists certainly recognize the importance of
exchange mechanisms, but they argue that markets alone cannot secure economic growth or
stability because they are inherently prone to market failure, especially in capitalist
economies.
Regulationists also argue that markets assume different forms and functions in different
epochs, economic periods, and economic sectors. They also examine the state‗s role in
providing many of the extraeconomic supports—material, institutional, policy driven, and
discursive—that enable markets to operate or that compensate for their inevitable failures.
They explore historically specific forms and functions of state intervention and insist that
these cannot be reduced to purely technical questions but are always
shaped by various kinds of social struggle. Therefore, they study the state‗s forms and
activities in terms of successive patterns of institutionalized compromise. Equally significant
are the other extraeconomic forms through which capital accumulation comes to be unevenly
and provisionally stabilized. Here regulationists discuss the role of networks, interfirm
linkages, norms, values, conventions, and other social forces in regularizing capital
accumulation.
The dominant Parisian School introduced three major concepts for addressing these
questions. An industrial paradigm is a model that guides the development of the technical
and social division of labor (e.g., mass production, flexible specialization). An accumulation
regime is a specific pattern of production and consumption that can be reproduced over a
long period. For example, Fordism involves a virtuous circle of mass production and mass
consumption. A mode of regulation is an ensemble of norms, institutions, organizational
forms, social networks, and patterns of conduct that can stabilize an accumulation regime.
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This is the closest equivalent to other work on governance. Parisians generally distinguish
five structural axes around which regulation (or governance) must occur in capitalism: (1) the
capital-labor relation, broadly conceived; (2) the enterprise form, which includes many
aspects of corporate governance, such as the main source of profits, forms of competition,
inter firm linkages, and links to banking capital; (3) the monetary and financial systems; (4)
the forms, functions, and social bases of state intervention; and (5) international regimes,
including the regulation of trade, investment, and monetary flows and the political
arrangements that link national economies, nation states, and
the world system. Other schools have similar concepts but each has its own distinctive
features reflecting its concerns with the sectoral, national, or transnational dimensions of
regulation, broadly conceived, and its interest in the market economy or its embedding in a
wider institutional and socio-cultural context.
While regulation theorists are more narrowly concerned with basic structural features of
capitalism and their medium- to long-term constitution and stabilization, more general
theories of governance tend to focus on institutions and practices across many different social
fields. Nonetheless, there has been a partial rapprochement between regulationist work and
studies of economic governance at the sectoral, local, regional, national, and international
levels. Thus, regulationists have shown increasing interest in different mechanisms of
governance and their role in regularizing the key structural forms of the economy in its
inclusive sense. And students of governance have become interested in why different
economic sectors have different modes of coordination, in the problems of economic
governance at different scales from the local to the global, in the shift from government to
governance in the state and interstate systems, and in the rise of networked forms of sociality
and network societies. There is certainly scope for continued dialogue and mutual learning in
these two traditions.
Chapter Four
Models of Governance
4.1 Democratic Governance
Decentralisation
In recent decades, decentralization has come to be regarded as an essential element of
democratic governance and most Western states as well as some non- Western states have
implemented decentralization reforms.
Meanings of Decentralization: Decentralization is the transfer of power and resources from

national governments to subnational governments or to the subnational administrative units
727
of national governments. Decentralization is often regarded as a top-down process driven by

a unitary or federal state in which the central government grants functions, authorities, and
resources to subnational levels. But impulses for decentralization can also originate from
these lower levels. According to UNDP (1997), ―decentralization, or decentralizing
governance, refers to the restructuring or reorganization of authority so that there is a system
of co-responsibility between institutions of governance at the central, regional and local
levels according to the principle of subsidiarity, thus increasing the overall quality and
effectiveness of the system of governance, while increasing the authority and capacities of
sub-national levels. …
Decentralization could also be expected to contribute to key elements of good governance,

such as increasing people's opportunities for participation in economic, social and political
decisions; assisting in developing people's capacities; and enhancing government
responsiveness, transparency and accountability.‖ While decentralization or decentralizing
governance should not be seen as an end in itself, it can be a means for creating more open,
responsive, and effective local government and for enhancing representational systems of
community-level decision making. By allowing local communities and regional entities to
manage their own affairs, and through facilitating closer contact between central and local
authorities, effective systems of local governance enable responses to people's needs and
priorities to be heard, thereby ensuring that government interventions meet a variety of social
needs.
Decentralization is a complex phenomenon involving many geographic entities, societal

actors and social sectors. The geographic entities include the international, national, sub-
national, an local. The societal actors include government, the private sector and civil
society. The social sectors include all development themes - political, social, cultural and
environmental. In designing decentralization policies and programmes it is essential to use a
systems-approach encompassing these overlapping social sectors and the different
requirements which each makes. . . . Decentralization is a mixture of administrative, fiscal
and political functions and relationships. In the design of decentralization systems all three
must be included. ‖
Forms and Dimensions of Decentralization
There are several distinct ways of understanding decentralization. We can distinguish

between political, administrative, and economic types/dimensions of decentralization.
Political decentralization refers to processes where the power of political decision making
and certain functions are transferred from a higher level of government to a lower one i.e.
subnational government. This can be from the level of the central state to lower levels such
as the meso (regions, provinces, or counties) and the local (communes or municipalities). It
728
can also refer to the transfer of political decision-making powers and functions from the
mesolevel—a region, for example—to the municipal level.
Political decentralization is the transfer of political authority to subnational governments.

This transfer takes place through constitutional amendments and electoral reforms that create
new (or strengthen existing) spaces for the representation of subnational polities.
Elections for important subnational offices are the hallmark of political decentralization and
the shift from appointed to elected subnational officials is the most common form taken by
decentralization in this dimension. In politically centralized systems, subnational officials are
appointed by the national government and therefore can be held accountable by voters only
indirectly (if at all). By giving subnational officials less cause to worry that their own careers
will suffer if they fail to conform to central preferences, elections increase the potential
autonomy of subnational governments. By giving subnational officials incentives to prioritize
concerns of local constituents, elections increase the accountability of subnational
governments
to these constituents. In a decentralized polity, elections are held not just for subnational
executive offices (such as mayors, governors, and chief ministers), but for representative
positions as well (such as municipal councilors and provincial legislators). Elections can also
be held for single-purpose subnational governments (such as water districts and school
boards) and not just multipurpose ones.
Both kinds of political decentralization can be seen in the Spanish case, where a first wave of
decentralization, following the transition to democracy in 1976 to 1978, involved transferring
powers from Madrid to the Autonomous Communities (ACs). Although this decentralization
is still not complete, a recently begun second wave of decentralization involves the transfer
of competences from the ACs to the municipalities. In some political systems, such as in
France and Sweden, there is no hierarchical relation among the levels of government below
the national level.
Note: Subnational governments are primarily accountable (in theory, if not always in fact) to
a territorially defined subset of the country‗s citizens, and their prerogatives tend to be
established in the constitution and in legal frameworks. In contrast, subnational
administrations are primarily accountable to hierarchical superiors in the national
government, who control the careers of subnationally located officials and who can modify
the prerogatives of these officials by administrative regulations. Decentralization can take
place in either case; it does not necessarily require the existence of full-fledged subnational
governments.
Administrative decentralization means the transfer of a number of tasks and functions from
central departments to lower levels of the administration. This may take different forms. It
might simply mean increasing the tasks of lower branches of the same department, which
729
remains a central department. Or it might involve transferring tasks to different territorial

administrations (that is, to a separate territorial civil service) as in France after the 1982
decentralization reforms. It may just be a dispersal of branches of the administrative system
in provincial towns away from the capitol as happened in the United Kingdom where, for
example, passport agencies or social security offices are found in different parts of the
country, or as is happening currently in Ireland where the Irish government is shifting a
number of administrative offices outside of Dublin.
According to USAID (2009), Administrative decentralization is the transfer of responsibility

for the planning and management of one or more public functions from the national
government and its centralized agencies to subnational governments and/or subnational
administrative units. Administrative decentralization refers to the institutional architecture—
structure, systems, and procedures—that supports the implementation and management of
those responsibilities under the formal control of subnational actors. It encompasses, among
others things, subnational departmental structures and responsibilities; human resource
requirements and management systems; and planning, monitoring and evaluation of service
arrangements. Administrative decentralization may or may not include improving capacities
for budgeting, financial management and financial control, depending on the degree of fiscal
decentralization in the country in question. Administrative decentralization also includes
mechanisms for working with higher, peer, and lower levels of government or
administration, as well as mechanisms for working with key local nongovernmental actors,
such as traditional authority structures and private sector partners.
Administrative decentralization alters each of the four critical elements of decentralization.

The impact on accountability is particularly important: under deconcentration, subnational
bureaucrats remain accountable to national officials, whereas under devolution it is desirable
that they become accountable to subnational elected officials for the quality of their
performance.
With respect to authority and autonomy, when control over personnel decisions is transferred
from national to subnational officials, not only do the latter gain additional authority over
government employees, but their autonomy from the national government is also enhanced.
Administrative decentralization also directly influences the capacity of subnational

governments and administrations by strengthening the systems and procedures that allow
these units to perform their assigned tasks. Given the great scope of administrative
decentralization, it is difficult to cover the range of activities involved, but a few basic
principles illustrate how to think conceptually and pragmatically about it:
Structures and procedures should be as simple as possible without sacrificing the ability
of subnational governments to meet their basic mandates. Structures and procedures should
730
be rule-based and transparent, but with adequate discretion in implementation given to

accountable managers.
Subnational governments and administrations should have an appropriate degree of

control over subnational employees; generally this means at least the basic autonomy to
hire and fire staff (within the bounds of established procedures defining a merit system),
although autonomy can be more restricted in deconcentrated systems and greater in more
fully devolved systems. Managers and staff should be subject to incentives and performance
review that encourage them to meet their responsibilities effectively.
Mechanisms for interaction with external actors should be structured in a way that meets
the specific goals of the relevant relationship (for example, to report to or make requests
to higher levels, obtain information and feedback from citizens, partner with traditional
authorities or other subnational governments, or procure goods and services from the
private sector).
Relations between appointed and elected subnational officials should be structured in a

way that balances the technical role of staff with the political roles of executives and
councilors Finally, economic decentralization means the attempt to move industrial and
other economic activities to the regions. This happens for two reasons. First, it reduces the
industrial congestion and therefore high costs in centres such as London or Paris. Second, it
is a part of regional policy aiming to bring jobs to the workers.
These different forms of decentralization are not intrinsically related to each other although
some forms imply the others. Administrative decentralization can take place without a
corresponding political decentralization, although effective political decentralization will
usually decentralize administrative resources as well. Among these resources are fiscal
powers to enable the decentralized bodies to carry out the tasks that are assigned to them.
Economic decentralization can occur without political decentralization although some
administrative decentralization may be necessary if the central state is involved in the policy.
Today, however, this form of decentralization is less common than in the 1980s and 1970s.
Finally, decentralization is related to, but not identical with, regionalization. First, there can
be decentralization, even of the political kind, without regionalization in the sense that local
government may be strengthened through decentralization without setting up elected regional
assemblies or even administrative regions. Second, regionalization is a form of political
decentralization, but regions themselves might be highly centralized, as in the Flemish
regions and communities or in Catalonia. In this sense, we can speak of Jacobin regionalism.
Periodization
Decentralization also has distinct meanings depending on the period of history in which it is
used. During the period of the Trente Glorieuses, the thirty years of the welfare state (1945 to
1975), the state was in continual expansion as it sought to manage the postwar economic
731
boom and to respond to the ever-increasing needs and aspirations of the population with
expanding policy programs. This entailed a high degree of centralization and uniformity
across the state‗s territory. Unitary states such as the United Kingdom, France, and Italy, as
well as federal states such as Germany and the United States experienced such centralization.
Regional and local governments even in states with a strong tradition of local government,
such as the United Kingdom, tended to become local administrations.
Central-local relations were marked by a principal agent relationship in which the central
state was the principal one, and regional and local authorities were the agents whose task was
to implement a number of welfare services on behalf of the state. During this period,
decentralization mainly took the form of administrative decentralization, which left intact the
role of the center in political decision making. This was true even for the so-called
decentralized
unitary states of Scandinavia and the Netherlands, where, although local government had an
important role in implementing the welfare state programs, there was still a high degree of
regulation by the central government or, in the Swedish case, the parliament.
The welfare state period was built on a consensus between the main political forces of the
Left and Right as part of the general postwar reconstruction. Nonetheless, some political
groups
on both the Left and Right mounted significant critiques of the welfare state. Political
decentralization became one element of these wide-ranging critiques. Among the Left were
neoMarxist thinkers from the Frankfurt School, such as Herbert Marcuse, who criticized the
stifling bureaucracy of the state, which hindered the full development of individual freedom.
In France, Michel Crozier attacked the French state and society for using the tools of
organization theory, and the autonomy advocated by politicians such as Michel Rocard was
under stress. These demands from the New Left in France and elsewhere became part of new
social movements described by Alain Touraine— regionalist, feminist, and environmentalist
groups. On the Right of the political spectrum, economists such as Milton Friedman and
Friedrich von Hayek, philosophers such as Robert Nozick, and political scientists such as
William Niskanen mounted a systematic critique of the welfare state, which implied reducing
or even abolishing some of the powers of the central state. This led to the New Right, or
neoliberal school approach, which became the basis of the political ideology of Ronald
Reagan and Margaret Thatcher. Both these schools of thought advocated a form of political
decentralization in the sense that they both wanted to reduce the power of the central state,
but they clearly meant different things by the term.
These two critiques of the welfare state were effective in different ways. The Left-wing
critique found expression in the student revolts of the 1960s whose effects were mainly
cultural, affecting values and lifestyle. This became known, retrospectively, as the neoliberal
policy and administrative approach of the New Right, however, and had a deeper political
impact. When the welfare state entered into crisis in the late 1960s and early 1970s, the ideas
732
of the New Right came to the fore with the arrival to power of Thatcher in 1979 and Reagan
in 1980. These ideas were put into practice as a way of responding to the crisis. There was
now a systematic attempt to reduce the interventionism of the Keynesian and Beveridgian
state through privatization and deregulation as well as separating functions that had
previously been the responsibility of thestate to private firms and to semi-independent
agencies. This was a kind of political decentralization, although it was not necessarily a way
of promoting local democracy. On the contrary, under Thatcher, the United Kingdom
became, in certain respects, more centralized than it had ever been and the powers of local
government were seriously reduced. On the other hand, there was a growth of governmental
semi-autonomous agencies that operated at arm‗s length from central government although
they were nominally under the control of the central departments. The Thatcherite notion of
democracy was a consumer democracy. The neoliberal reforms had their greatest impact in
the United Kingdom, but variations of them were carried out in almost all other developed
states. In Denmark, for example, there were neoliberal type reforms
even before Thatcher came to power in the United Kingdom. Furthermore, Thatcherism
became
popular in the states of Latin America and in the new democracies of the former Soviet Bloc.
The emergence of the neoliberal approach to policy and administration coincided with the
―relaunch‖ of European integration in the mid-1980s. The events were related in that both
were responses to the crisis of the old welfare state paradigm and to the challenges of
globalization.
What is important from the point of view of decentralization is that the strengthening of
European integration also meant the introduction of the principles of subsidiarity and
partnership. These were first introduced as principles of governance with the successive
reforms of the Structural Funds. These principles were finally given full legal recognition
with the Treaty on European Union signed at Maastricht in 1992. At the same time, the single
market project was in line with Thatcher‗s neoliberal approach. The neoliberal reforms of the
1980s and 1990s were continued by Center-Left politicians such as Tony Blair in the United
Kingdom, Gerhard Schroeder in Germany, and Lionel Jospin in France, each of whom
developed a distinctive third way that attempted to combine the basic ideas of neoliberalism
with the values of social democracy.
Tendencies toward Decentralization
The movement toward political decentralization intensified in the 1980s. During this period,
all of the large Western states, with the exception of the United Kingdom, and many of the
smaller ones carried out decentralization reforms. In Spain, after the death of Franco in 1976,
the Spanish
Constitution of 1978 linked democratization, Europeanization, and decentralization in the
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form of the Estado autonomico. France launched major decentralization reforms in 1982. In
1993, Belgium made the final transition from its form of a Jacobin unitary state to a highly
decentralized federal state. The Scandinavian states, although already described as
decentralized and unitary, embarked in the late 1980s on a series of reforms as a self-
regulating municipality designed to reduce some of the regulatory burdens, which impeded
the municipalities. In the 1990s, Italy experienced a constitutional crisis that swept away at
least part of the old corrupt political class and embarked on important reforms that
strengthened the regions and local authorities. Accelerating European integration also
encouraged at least administrative decentralization in the form of the establishment of
administrative regions in small, traditionally highly centralized states such as Greece, Ireland,
and Portugal.
The Codification of Regional and Local Democracy
Decentralization is today regarded as an essential element of good governance and of

democratic practice, and a number of international organizations have worked to establish
this practice. One of the most important is the Council of Europe, one of whose key tasks is
the promotion of democracy. The Council played, for example, an important role in
overseeing the transition to democracy of the former communist states, most of which
became members. The Congress of Local and Regional Authorities of Europe (CLRAE), a
branch of the Council of Europe, has the task of promoting regional and local democracy.
Already in 1985, the CLRAE promulgated the European Charter of Local Self-Government,
which has since been signed and ratified by fortyone of its forty-six member states, and two
others have signed but not ratified it. The charter describes some of the conditions for the
exercise of local autonomy, seen as an essential element of democracy. It is currently
working to produce a similar charter on regional self-government, although reaching
agreement is proving more difficult. At the same time, the CLRAE has made a
number of declarations approving the development of regional government. In the case of the
transition countries of the former Soviet Bloc, the CLRAE ensured that regional and local
democracy became enshrined in their constitutions and the design of their states. These had
previously been highly centralized and the local level completely dominated by the ruling
communist parties. In this way, political decentralization has become an essential element of
democratization and regional and local democracy are now seen as essential elements of
democracy itself. This perspective has also been adopted by the United Nations (UN) Habitat
Program, which, in 2004, adopted a Declaration of Principles of Effective Decentralization,
largely inspired by the European Charter of Local Self- Government. We have also noted that
among the principles of governance of the European Union (EU), as expressed in the
Maastricht Treaty on European Union, are subsidiarity and partnership.
Liberal representative democracy has been closely associated with the emergence of the
734
nationstate as the primary form of state organization. Democracy has been understood as
national democracy— democratic legitimacy is grounded on the decisions of assemblies that
represent the nation—and the theory of democracy has been built on this assumption. As a
result of the trends outlined previously—the actual decentralization reforms of most
advanced states and the codification of decentralization by bodies such as the Council of
Europe, the European Union, and the United Nations—the theory of democracy must now
include a consideration of regional and local democracy (and also transnational democracy)
and decentralization can be considered an instrument to achieve as well as a condition of its
existence.
Forms/modes of Decentralization: Deconcentration, Delegation and Devolution
The World Bank distinguishes between deconcentration, delegation, and devolution as three
distinct modes of administrative decentralization of the redistribution of authority,
responsibility, and financial resources for providing public services. The three types are
differentiated according
to the degree of transfer.
Deconcentration: Deconcentration is the weakest form with delegation coming next.

Deconcentration may be defined as the national government reassigning responsibilities to
the field offices of national ministries without placing these offices under the control of
subnational governments. In other words, deconcentration reassigns authority among
different levels of the central government. It can shift operational responsibilities from
central government officials in the capital city to those working in regions, provinces or
districts, or it can create strong field administration or local administrative capacity under the
supervision of central government ministries. Deconcentration can actually enhance the
penetration of national governments into parts of the national territory in which its presence
has been marginal in the past, hence its appeal in many post-conflict environments and in
fragile states. Although it involves the most limited changes, deconcentration may also
constitute the most feasible and desirable set of interventions in various settings.
Deconcentration is also an appealing form of decentralization for those
services that should not be devolved or should not be fully devolved (as per the principles
outlined above). These include services where scale or externalities are involved (for
example,non-local roads and water resources), or where redistribution of wealth and national
standards are important
Delegation: Delegation is referred to as the transfer of responsibilities to semi-autonomous

bodies, such as executive agencies, public enterprises, regional development corporations,
and so forth. Delegation constitutes a greater degree of change in the distribution of power
relative to deconcentration because it shifts responsibility for specifically defined functions
to subnational governments or subnational administrative units. Delegation can be used as a
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means of building the capacity of subnational governments and administrative units in

preparation for subsequent moves toward devolution. In addition to multipurpose subnational
governments and administrative units, the national government can delegate responsibilities
to single-purpose governments and administrative units, parastatals, private firms, and/or
nongovernmental organizations. In these cases, delegation moves service delivery closer to
people, but not necessarily through subnational governments.
Devolution: According to USAID (2009), devolution is the most expansive form of

decentralization in that it requires subnational governments to hold defined spheres of
autonomous action, which typically means the use of subnational elections. Thus, unlike
deconcentration and delegation, devolution cannot occur in the absence of political
decentralization, and for that reason devolution and political decentralization are tightly
linked as concepts. After devolution, separately elected decision makers in subnational
governments may be largely independent of the national government, but they are still bound
by the provisions of national laws (such as those regarding political rights and civil liberties),
national policy priorities (including meeting basic needs and reducing poverty), and national
standards (in such areas as fiscal responsibility, healthcare, and water quality).
Devolution is defined as the transfer of power from higher to lower units of any system. In its
broad form, devolution resembles decentralization, but is often regarded as being more
complete and permanent than decentralization. Most frequently, devolution is used with
reference to the transfer of responsibilities and authority from central to subnational (or
regional to local) levels of government. Beyond this minimal definition, the understanding of
what devolution includes and excludes and how it differs from other forms of delegating
responsibilities varies across contexts. A general distinction can be made between devolution
as an umbrella term for various ways of shifting down responsibilities and devolution as one
specific mode of decentralization.
Hence, devolution is regarded as the strongest mode of decentralization in the sense that
powers are devolved to political entities with a separate corporate status, such as local or
regional governments. Therefore, devolution is political in the twofold sense that the
receiving end of devolution is directly legitimated by popular or indirect elections and that
the devolution includes decision making power rather than pure transfer of responsibilities
for service delivery.
That is why devolution is also referred to as political decentralization. Although other

international organizations (such as the Organisation for Economic Co-operation and
Development) use devolution as an umbrella term (in the sense of decentralization used by
the World Bank), devolution is more frequently used as a process of moving down political
decision-making power rather than merely shifting administrative responsibilities downward.
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Motivations for devolution in that sense include the perception that devolved governments
are best placed to develop and implement policies that exploit endogenous local or regional
capabilities and are, hence, an appropriate reaction to increased competition between regions
in a globalized economy. Although it is a matter of debate under which conditions devolution
can deliver improved policies and enhance regional competitiveness, concerns against
devolution are also connected to the positive effects of national uniform regulations and
levels of taxation.
Devolved Systems
To qualify as a devolved system, the subnational levels of government should be legally

established as institutions that exercise power within clearly recognizable geographical
boundaries. Other criteria include democratic institutions such as popular elections and the
existents of assemblies. Whether these criteria also include financial powers, such as the
power of taxation (e.g., in the United Kingdom, taxation is excluded from devolution), is
contested. Given these criteria, a rather different meaning of devolution comes into focus. In
many unitary countries, such subnational bodies did not exist or have not been developed
to full-fledged political entities. In that context, devolution is less about transferring
particular areas of responsibilities; instead, it is first about creating political authorities at
the local or regional level. When used that way, devolution is associated with change at the
constitutional level of a country and is frequently a reaction to demands to politically
recognize ethnic or cultural diversity within a particular country rather than an exercise of
administrative reform policy.
Devolution as a notion in this sense has been prominent in the UK context, where popularly
elected authorities have been established in Scotland, Wales, and, although in a different
context, Northern Ireland. Other examples of major political decentralization, including
constitutional change, include Spain, Belgium, and Mexico. Devolution has transformed
some of these countries—for example, Belgium—into fully fledged federal states. In other
cases, such as the United Kingdom or Spain, the process has, so far, resulted in a pattern of
asymmetric devolution with different regions possessing different degrees of autonomy, and
the final settlement of these ongoing processes remains an open question. Devolution
therefore should not be regarded as an automatic process leading to federalism or
confederalism. Although devolution in the sense of creating devolved systems is a process of
political reform linked to demands for local, regional, or ethnic self government, it is also
used in federal systems to indicate major shifting of responsibilities between levels of
government in specific policy domains. In that sense, the substantial shifting of policy
responsibilities in the welfare sector in the United States in the 1990s has been discussed as
part of the wider devolution revolution.
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Devolved Governance
What links the different dimensions of devolution is the perception that these trends give way
to new forms of governance between levels of government. Given the weakened capacity for
topdown governance, the hierarchical layering of levels of government is said to be replaced
by increasing reliance on cooperative forms of interaction. Therefore, devolution is
frequently regarded as part of the move toward multilevel governance—that is, a system,
where different levels of government, including supranational levels (e.g., the European
Union), simultaneously interact with each other without necessarily following the
hierarchical chain of levels (e.g., regional government directly interacting with the European
Commission). Any analysis of governance in devolved systems has to consider the difference
(and potential divergence) between the formal devolution of authority and responsibilities on
the one hand and the actual balance of power between levels of government and the degree of
autonomy of subnational
levels of government on the other hand. Criteria for measuring administrative and political
decentralization, as used by the World Bank and in the field of fiscal federalism, provide one
way of assessing the degree of autonomy. However, from the perspective of the governance
literature, these criteria alone do not provide a complete picture. For example, Rod Rhodes‗
analysis in Beyond Westminster and Whitehall showed a considerable degree of dispersion of
power in the United Kingdom long before devolution was pursued. At the same time, more
recent analysis of the UK case shows that devolution goes hand-in-hand with diverse ways of
controlling regional government activities, particularly based on the financial powers of
central government. Correspondingly, research on the United States provides evidence that
devolution in some domains has been accompanied by a significant flow of new federal
regulations.
Center-Local Relations
The notion of center-local (or central-local) relations refers to various aspects of the political
and administrative relationship between central and local levels of government. The term
captures the division of responsibilities and power, as well as patterns of interaction and
instruments of control across these levels. The concept is closely associated with the broader
notion of intergovernmental relations (IGR). Center-local relations are particularly interested
in assessing and comparing the degree of local autonomy or, alternatively, the degree of
centralization of intergovernmental relations. At the same time, the concept has played an
important role in the development of the wider governance literature. In particular, critical
738
reflections on the concept of center-local relations itself provided key contributions to the
body of literature that is associated with governance.
This understanding sets centre-local relations apart from concepts like center-periphery
relations. The latter refers to the comparative assessment of different regions or subregions in
terms of economic strength and relevance, including dependency relationships. While these
concepts are broadly related, center-local relations focus on intergovernmental interaction
rather than on socioeconomic dimensions
.
Central-Local Governance and Networks
The concept of central-local relations (rather than center-local) emerged in the literature on
the United Kingdom, where it was used to refer to domestic intergovernmental relations. The
term was seen as appropriately describing the constitutional setting of a unitary state that
lacked the more complex (―vetopoint‖ rich) intergovernmental relationships that
characterize federal states, such as the United States, Switzerland, and Germany (the latter
associated with the literature on joint decision making rather than central-(state)-local
relations). The literature revealed a growing degree of centralization since at least the 1970s,
as well as increasingly adversarial relationships. At the same time, the analytical value of
central-local relations has encountered increasing criticism. This criticism was particularly
directed at the supposed bilateral focus (on central government vis-à-vis local authorities) of
the central-local literature. In particular, it was argued that the increased use of private or
third parties, as well as the growth of quasigovernmental organizations, added substantial
complexity to the domain.
At the same time, it was recognized that representative institutions of local government
played a relevant role in central-local relations, in the United Kingdom and more so in other
countries. This ―national world of local government‖ has always been a prominent feature of
central-local relations in countries like Denmark, where bargaining over local government
budgets between local government associations and the central government is a key feature
of central-local relations. Other trends that are said to qualify the centrality of the central-
local relations perspective include the perceived shift toward multilevel governance, with its
stress on increasing complexity and flexibility of intergovernmental relations. Different
levels of government, including supranational levels (e.g., the European Union), interact
simultaneously without necessarily being hierarchically ordered. Given crossnational trends
toward political decentralization and devolution, as well as the growing importance of the
European Union, any perspective that solely relies on the bilateral central-local relationship
is likely to be severely limited. At the same time, the significance of these developments
should not be overemphasized, and the relationship between the center and the local still
remains politically important.
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While these empirical developments have some what questioned the focus of (and on)
centrallocal relations, the work by Rod Rhodes also challenged the underlying theoretical
assumption of the central-local literature. He argued that the literature has displayed a bias
toward formal institutional (or governmental) structures while neglecting advances in policy
research. This critique has been the basis of a key contribution to the emerging policy
network literature.
Rhodes suggested policy networks as an alternative unit of analysis of sub central

government and its relation to central government. Such a perspective acknowledges the
functional differentiation, if not fragmentation, of governmental activities at the central and
local level. Also the approach emphasized low ―relational distance‖ between policy
bureaucrats and professionals in a particular policy domain at the central and local
government levels. At the same time, it was acknowledged that specialized professionals or
bureaucrats at both levels of government would not dominate invariably throughout all policy
domains. ―Territorial networks‖ populated by ―topocrats‖ (chief executives and local
political leaders) could prevail in some areas.
The relationship between policy professionals (or ―technocrats‖) and topocrats in a given
policy area is regarded as among the key factors shaping central local relations. The network
perspective allowed analyzing different patterns of intergovernmental relations in different
policy domains. Rhodes developed a typology of policy networks that captures the variety of
actor constellations in domains where subcentral governments are involved. (The typology
differentiated among policy community/territorial community, professional network,
intergovernmental network, producer network, and issue network.) While frequently
criticized, this typology has been pivotal for the development of the wider policy network
approach in Europe. Therefore, analyzing governance through the network perspective can,
in part, be traced back to debates on central-local relations.
Autonomy
While this development of research on subcentral government suggests that the concept of
center-local relations has outlived its analytical usefulness, the perspective continues to play
a key role in research on the degree of local autonomy. Local autonomy is, in turn, regarded
as a major factor facilitating local democracy and responsiveness of services, as well as
encouraging citizens‗ engagement and participation. Reforms in developing and developed
countries alike, which aim to strengthen the local government and democracy, also renewed
the interest in center-local relations as one dimension defining local autonomy.
Edward Page noted that the notion of local autonomy, as control by the local community over
its own affairs, contrasts with the fact that local government is, in essence, regarded as a
subordinate
740
institution. Hence, the degree of local autonomy depends on the leeway granted by higher
levels of government. That also applies to the federalist countries with a deep rooted tradition
of local self-government or self administration, like the United States and Germany.
However, others would question whether these ideas apply to cases like Switzerland, with the
distinct tradition of communal autonomy (Gemeindeautonomie). As these examples suggest,
central-local relations are at the heart of any assessment of the degree of local government
autonomy in an international comparative perspective. Such comparative assessments usually
start from broad classifications of different ―families of nations‖ with similar state traditions
that are associated with specific patterns concerning the constitutional/legal setting of local
government. Other dimensions include the division of functions and the financial regime
underpinning this division.
In different state traditions—for example, the Nordic, Continental European, Anglo-Saxon,

and Napoleonic state traditions—central-local relations are defined in different ways. For
example, in the German state tradition, local ―self-administration‖ rather than local ―self-
government‖ is connected with a strong local level that is responsible for conducting genuine
local tasks as well as a wide range of tasks delegated from higher levels of government
(which, today, amount to about two-thirds of local spending).
This comes with a rather tight regulation of local government action, despite the
constitutional guarantee of the right of local self-administration. This ―mixing‖ of tasks and
responsibilities between central and local levels is less developed in countries with a strong
tradition of local self-government.
While state traditions are regarded as having a long-term effect and are supposed to be
reflected in immediate policy choices, such reforms have, nevertheless, transformed central-
local relations in a substantial way (e.g., in the United Kingdom toward centralization).
However, in other countries, central local relations have not witnessed major changes, but
reform themes have been filtered through the general institutional framework and the modes
of interaction associated with these. For example, the Nordic countries provide evidence for
such filtering of general reform themes that have strengthened the tradition of cooperative
center-local relations and the (already strong) position of local government. Some have
argued that financial autonomy, defined by the
legal competence to raise revenue and set spending priorities independent of the central
government, lies at the heart of local autonomy because legal and organizational autonomy
could only have an impact if financial resources are available to make use of these powers. A
related interest is concerned with the independent impact of local and urban policies.
By asking if urban politics matter, Harold Wolman and Michael Goldsmith move away from
a focus on local discretion defined by central regulation and toward exploring the local
capacity tovinitiate policies that have an independent impact.
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Control
While local autonomy defines the bottom-up view on central-local relations, the concern with
control can be associated with a top-down perspective on the relationship. In that context, the
literature that highlights the variety of modes of governance has brought new insights into
research on central-local relations. Such a view draws on the distinction between
―hierarchy,‖ ―market,‖ and ―networks/cooperation‖ as three ideal type modalities of
control (or coordination)
and explores mixes and shifts within, as well as across, modes. This perspective allows the
empirical assessment of claims regarding paradigmatic shifts toward new localism or various
new modes of governance associated with multilevel governance or the so-called new
public management. Much of the governance literature assumes that intergovernmental
relations in contemporary societies increasingly rely on cooperative modes of interaction.
Empirically, this is reflected in the Scandinavian experience, where various reforms since the
1990s (e.g., Free Commune Experiments) have tended to weaken central control over the
operation of local government—without, however, introducing far reaching changes of the
overall control regime.
Other European countries (e.g., Belgium and France) provide corresponding evidence of
modest shifts toward less hierarchical control and various approaches of sharing
responsibilities in policy development. Some claims have emerged regarding the emergence
of ―markets‖ instead of hierarchical modes of control, for example through benchmarking
exercises that compare local performance against uniform standards. However, other scholars
have noted an increased use of market and hierarchical instruments at the same time. They
have pointed out, for example, that the wave of reforms associated with new public
management resulted in an increasing amount of central regulation and control over local
government in the United Kingdom. Local government is described as having experienced a
―double whammy,‖ being exposed to both ―old‖ bureaucratic regulation and new,
―modern‖ control techniques, such as league tables,
benchmarking, and audits.
In other countries, like Germany, the debate on new public management has not affected
modes of control of local governments. Some state governments pay lip service to the new
public management debate, but local government control continues to rely on a hybrid of
hierarchical regulation and cooperative interaction. While financial pressures have triggered
far-reaching changes in the internal administrative setup of local governments and their
political organization (for example, the introduction of directly
elected mayors), the introduction of new modes of auditing was not an issue on the reform
agenda. The theme of control in centre-local government relations is also relevant in the
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context of a number of developing countries that have witnessed a (frequently externally

induced or supported) shift toward decentralization and the strengthening of local
government. However, evidence suggests that such a shift (if materialized) will not result in
more responsive local service or inclusiveness of the wider population because
decentralization allows the local elite, rather than the wider population, to control public
governance. Therefore, the lack of effective central control could be regarded as one
explanation for the perceived failure of decentralization to deliver the expected policy
outcomes (e.g., in terms of poverty reduction).
Analyzing Central-Local Relations in the Context of Governance
The concept of central-local relations has played a major role in the development of the
governance perspective since the 1980s. This may seem to be a paradox because at the core
of the governance literature is the perception of a growing diversity of the institutional
landscape at central, local, and regional levels of government that challenges the analytical
value of the bilateral concept of center-local relations. Although some of the contemporary
literature has focused primarily on ―multilevel governance,‖ an interest in central-local
relations remains of key importance when it comes to the assessment of recent reforms of the
institutional set-up of local government or the introduction of new modes of control.
Moreover, regulatory and policy reforms, such as privatization, the introduction of market-
type governance mechanisms, and the move toward an ―audit society‖ have a profound
impact on intergovernmental relations. Centrallocal relations are increasingly complex and
characterized by various new modes of control and patterns of interactions. However,
generalizations in the sense of paradigmatic shifts toward ―new‖ models of center-local
relations have to be treated with care. In particular, comparative analysis of modes of control
in center-local relations reveals the contingent and varying nature of control patterns.
These depend on a number of different factors that vary across countries but also across
policy domains. Moreover, general reform themes, like new public management or the
challenging of the welfare state, have triggered different responses in different countries—
also in the domain of center-local relations. In that sense, center-local relations do not only
constitute a major approach to the study of local governance. It is also a topic worth
exploring in the context of changing patterns of statehood and governance. For doing so, the
concept of center-local relations offers a variety of analytical tools. While the (comparative)
mapping of the country-specific tradition and setting of the local vis-à-vis the central level
provides a first approach that remains relevant, the literature has highlighted more empirical
criteria, like the size of local government, the share of spending on public service
employment at different levels of government, or the allocation of tasks between levels. In
order to move beyond these various ways of mapping diverse settings of
central local relations, the network approach developed by Rhodes and others has provided
743
an important inspiration that has triggered a variety of network oriented perspectives in

centre-local relations and intergovernmental or inter organizational coordination more
widely. Also, the perspective that explores mixes and shifts in control relationships provides
a fruitful analysis.
What sets centre-local relations apart from the general intergovernmental literature is the
central role of normative perspectives and debates about the (desirable) role of local
government within a country‗s institutional architecture of democracy. This normative
dimension will always be an undercurrent of more analytical approaches exploring
governance arrangements in central-local relations.
Collaborative Governance
Collaborative governance is a way of conducting policies whereby a government involves its

citizens, social organizations, enterprises, and other stakeholders in the early stages of the
policymaking process. The contrast with more traditional public policy procedures is that
parties are truly involved in the development of policy proposals, while in classic
opportunities of public comment, citizen and interest group involvement only occurred once
the policy proposal had been developed. Interactive decision making is a policy practice in
which the involved actors try to reach a cooperative solution with broad consensus about the
treatment of the issue at stake.
Collaborative governance can be seen as a means of achieving more acceptable, rich and
resilient decisions and encourages a flexible decision-making process more open to divergent
viewpoints and stakeholder involvement. Moreover, it is seen as a new style of governing, in
which politicians, public managers, and public administrators have to adopt new ways of
doing things, which can involve new roles, new procedures, and new institutions.
Background
Collaborative governance fits in the shift from ―government‖ to ―governance,‖ from
hierarchical and well-institutionalized forms of government toward less-formalized, bottom-
up forms of governance in which state-authority makes way for an appreciation of mutual
interdependence with different stakeholders. Public authorities recognize this
interdependence more and more as a basic governing principle in a continuous process of
negotiating. Stakeholders are approached as knowledgeable actors in the policy making
process. Collaborative governance takes place in different forms. An important type is the so-
called collaborative dialogue. Collaborative governance practices are a reaction on traditional
planning and policymaking approaches that are primarily top-down oriented, focusing on the
government instead of the governed, mainly technocratically oriented and adversarially
organized. Collaborative governance is used to realize collective decision making that builds
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on a solid basis of trust and consensus, enhances governmental legitimacy, and makes
efficient use of the dispersed resources of the different stakeholders. By doing so, reaching
effective policy solutions can be realized far more easily than in traditional governmental
ways.
Potential Benefits
Collaborative decision making tries to provide a solution for a number of existing problems
in complex decision-making processes, which are as follows:
 Acceleration of the policy process: By involving all kinds of actors at an early stage, it is
hoped that the use of veto power will decrease and support for decisions will increase.
 More flexible policies better suited to changed circumstances: By involving more actors
in the decision- making process, more and various aspects of the problem can be included
in the search for solutions, and problem formulation becomes more flexible.
 Enrichment of solutions: Because not only different perspectives on and ideas about
problems and solutions are let loose in the process, but also multiple types of knowledge,
information, skill, and experience are employed, a better analysis of the problem area is
possible, and better solutions can be created. Collaborative governance offers the
potential to utilize the creativity and experience expertise of those involved in order to
address issues on a broader, and possibly more innovative, way.
 Enhancing democratic legitimacy: Collaborative governance is often referred to as the

solution to restore the bad relationship between citizens and decision makers. When the
citizen can identify with the policy products of government, the expectation is that they
will be more satisfied with government and politics, restoring and developing trust in
government. Moreover, by involving more stakeholders, decision making acquires a
lessclosed character and more democratic legitimacy.
Criticism
Collaborative governance is not without problems. Its critics mention diverse shortcomings
of the practice of collaborative governance, of which the following are, mentioned the most.
First, processes of collaborative governance have high transaction costs and take time and
energy because processes get complex (many different actors) and difficult to manage.
Second, there isvthe problem of biases in the representation of interests. Well-informed
and organized interestvgroups are better equipped to participate in these processes than
―weak actors,‖ like unorganizedvcitizens. Sometimes in collaborative governance, policy
745
development leads to the concentration of power in the hands of those who oppose
development, shout the loudest, and have the time to campaign.
Third, traditional administrative procedures and practices are not suitable to

facilitate collaborative governance practices. Collaborative processes are driven out by the
traditional ways of doing things.
Fourth, there is the problem of venue shopping. In practice, actors don‗t want to commit
themselves exclusively to one collaborative process. When they think they can realize their
ambitions via another way (the court or the representative democracy), collaborative
processes often fail to enforce commitment.
Fifth, the democratic anchorage of collaborative governance practices is often missing.

Collaborative governance can be seen as a form of participatory democracy, which often
times runs parallel to existing representative forms of democracy. This missing link has the
danger that outcomes from the collaborative governance.
Collaborative Planning
Collaborative planning is a process of engaging stakeholders in face-to-face dialogue to

develop a plan that meets the interests of all affected parties. Collaborative planning involves
negotiation among affected parties to achieve a consensus decision and often relies on an
independent mediator or facilitator to assist in negotiations. Collaborative planning is a
relatively recent approach to planning that emerged in response to growing dissatisfaction
with more traditional, expert based planning models. The theory underlying collaborative
planning is that planning is a value-based process that attempts to achieve diverse goals and
tradeoffs that cannot be properly assessed by experts or scientific analysis. Diverse goals and
tradeoffs can only be incorporated into plans by delegating responsibility for plan
development and approval directly to stakeholders. Stakeholders include any groups or
individuals affected by the plan.
Collaborative planning is a logical extension of recent trends in planning theory and practice.
Beginning in the 1960s, the dominant model of technocratic planning, which relied on
expertbased, scientific decision making, was increasingly under attack for its failure to
adequately consider the interests of different stakeholders. The need for increased public
involvement in setting goals and objectives for planning became well accepted. Public
involvement in planning was extended beyond goal formulation by new models, such as
advocacy planning and mediation planning, which stressed the need for public participation
in the actual development and approval of plans, as well as in development of planning goals.
Collaborative planning further extends these more participatory models by positing the need
746
for a proactive initiative to delegate control of all aspects of the planning process to
stakeholders who are formally organized around a ―planning table‖ to prepare plans.
Advocates suggest that collaborative planning has several advantages over other planning
models. First, collaborative planning will produce a plan that is more likely to be in the
public interest because it attempts to meet the diverse goals and objectives of all stakeholders
by relying on consensus agreement and consideration of more creative options developed
through interactive dialogue. The inclusion of scientific experts as stakeholders can ensure
that decisions are based on sound information.
Collaborative planning is also more likely to lead to effective implementation because

stakeholders actively support implementation of a plan that they developed and that has
benefits for all interests. Collaborative planning also creates additional benefits, including
improved knowledge and skills of participants and improved stakeholder relationships.
These additional benefits, sometimes referred to as social capital, can generate important
gains to society, such as reduction in conflict and improved public decision making.
Collaborative
planning is emerging as the preferred model of planning in both theory and practice.
Collaborative planning is increasingly used in jurisdictions in North America, Europe, and
Australia by agencies such as the U.S. Forest Service, the U.S. Environmental Protection
Agency, and many other state and local planning agencies. The most comprehensive
application of collaborative planning to date has been in British Columbia, Canada, where
collaborative planning was used commencing in 1992 to develop land and resource
management plans for the entire provincial land base. Despite intense differences among
stakeholders, over three-fourths of the plans in British Columbia were approved by
consensus agreement among all stakeholders.
Collaborative planning also faces challenges. To be effective, collaborative planning requires

the presence of well-organized stakeholders representing the spectrum of society‗s interests
who are able and willing to participate. When a broad spectrum of well-organized
stakeholders exist, it is challenging to decide how many will be formally represented in the
process. Too many representatives can make the process unwieldy, while too few will make
the process unrepresentative.
The consensus rule for decision making is difficult to achieve and may result in vague or
secondbest solutions in order to reach agreement. The ability to achieve consensus is reduced
by the more challenging the planning problem and the larger the differences in values of
stakeholders. Implementation of collaborative planning may also be resisted by dominant
interests who do not want to give up power. Effective design and management of
collaborative planning is required to achieve benefits and
overcome challenges. Recent research recommends several keys. All interests need to be
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represented in the planning process. To ensure that the number of participants is manageable,
organizations with similar interests can be presented by only one party and the main planning
table. A second subsidiary planning table can be used by the common interest organizations
to ensure that their delegate fairly represents their interests. Collaborative planning processes
also need clear objectives, clear structure of accountability and management, adequate
support staff, adequate information, and training and financial support for stakeholders.
Collaborative planning processes require sufficient time to reach decisions.
Many processes can take over four years. Collaborative planning requires good facilitation
and involvement of the public, who may not be represented at the planning table.
Governments also need to retain their final statutory decision-making authority over planning
proposals recommended by collaborative processes. Collaborative planning is a relatively
recent planning model. Although evaluation of performance of collaborative planning is still
in its embryonic stages, evaluations to date confirm many of the significant benefits of the
collaborative approach.
Given the increasing popularity of collaborative planning, more evaluative research and
development of best practice guidelines will be important to ascertain strengths and
weaknesses of this new planning model.
Deliberative Democracy
Deliberative democracy is a movement in political theory that claims that political decisions
should be the product of fair and reasonable discussion and debate among citizens. In
deliberation, citizens should exchange arguments and consider different claims that are
designed to secure the public good. Through this conversation, citizens come to an agreement
about what procedure, action, or policy will best produce the public good. Deliberation is a
necessary precondition for the legitimacy of democratic political decisions. Rather than
thinking of political decisions as the aggregate of citizens‗ preferences, deliberative
democracy claims that citizens should arrive at political decisions through reason and the
collection of competing arguments and viewpoints. In other words, citizens‗ preferences
should be shaped by deliberationin advance of decision making, rather than by selfinterest.
With respect to individual and collective citizen decision making, deliberative democracy
shifts the emphasis from the outcome of the decision to the quality of the process.
Deliberation in democratic processes generates outcomes that secure the public or common
good through reason rather than through political power. Deliberative democracy is not
based on a competition between conflicting interests, but on an exchange of information
and justifications supporting varying perspectives on the public good. Ultimately, citizens
should be swayed by the force of the better argument rather than by private concerns, biases,
or views that are not publicly justifiable to their fellow deliberators. In contrast to an
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agonistic view of democracy, deliberative democracy attempts to adjust for inequalities in

social and economic power by emphasizing that all citizens are equal in their capacity to
reason and participate.
Early Influences
Two of the early influences on deliberative democratic theory are John Rawls and Jürgen
Habermas. Rawls advocated the use of reason in securing the framework for a just political
society. For Rawls, reason curtails self-interest to justify the structure of a political society
that is fair for all participants in that society and secures equal rights for all members of that
society.
These conditions secure the possibility for fair citizen participation in the future. Habermas
claimed that fair procedures and clear communication can produce legitimate and consensual
decisions by citizens. These fair procedures governing the deliberative process are what
legitimate the outcomes.
Features of Deliberation
Deliberative theorists tend to argue that publicity is a necessary feature of legitimate

democratic processes. First, issues within a democracy should be public and should be
publicly debated.
Second, processes within democratic institutions must be public and subject to public
scrutiny.
Finally, in addition to being provided with information, citizens need to ensure the use of a
public form of reason to ground political decisions. The public nature of the reason used to
ground political decisions generates outcomes that are fair and reasonable, but subject to
revision if warranted by new information or further deliberation. Some deliberative theorists
claim that the deliberative process of exchanging arguments for contrasting viewpoints can
and should produce a consensus. Others think that disagreement will remain after the
deliberative process is completed, but that deliberation can produce legitimate outcomes
without consensus. Even when the exchange of reason, arguments, and viewpoints does not
seem to produce a clear outcome, many deliberative theorists suggest that the dissent
produced, and the continuing debate, enhances the democratic process. Because the
deliberative process requires that citizens understand, formulate, and exchange arguments for
their views, norms of clear communication
and rules of argumentation are important to formulate. Citizens must be speaking the same
language, both literally and figuratively. Citizens must be able to present their claims in
understandable and meaningful ways to their fellow deliberators. These claims must also be
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supported by argumentation and reason that makes these views publicly justifiable to
differently situated deliberators. Most theories of deliberative democracy hold that the
maximum inclusion of citizens and viewpoints generates the most legitimate and reasonable
political outcomes.
In addition to improving the level of discussion and accounting for the most arguments,
moreinclusive deliberative processes are fairer because more people have their views
considered. Whether or not a citizen‗s view is present in the outcome, it has at least bee
figured into the debate by fellow citizen deliberators.
Challenges to Deliberative Democratic Theory
Many theorists consider the following possible problems with theories of deliberative
democracy. If only certain modes of expression, forms of argument, and cultural styles are
publicly acceptable, then the voices of certain citizens will be excluded. This exclusion will
diminish the quality and legitimacy of the outcomes of deliberative processes. Further,
deliberation assumes the capacity of citizens to be reasonable, cooperate, unify, and shape
their views based on rational debate and the views of others. Some argue that this may be
more than human beings are capable of either because of human nature or because of already
existing social inequalities and biases. Social conditions, such as already existing structural
inequalities, pluralism, social complexity, the increasing scope of political concerns, and the
impracticality of affected citizens having forums in which to deliberate are also reasons why
some are skeptical of the viability of a deliberative form of democracy. Deliberative
democratic theory brings ethical concerns into the realm of democratic decision making. The
ultimate aim of deliberative democratic practices is increased citizen participation, better
outcomes, and a more authentically democratic society.
4.2 Economic Governance
Economic governance in market-based economies such as that of the United States is largely
a question of when and how governments should intervene in those markets. Neoclassical
liberal theory suggests that interventions should be minimized, limited to ensuring that
markets function efficiently and providing public goods that markets fail to provide. Various
forms of democratic theory argue, in contrast, that political rather than market processes
should play a primary role in allocating resources and setting economic priorities. This
debate has engendered a voluminous literature in economics, political science, and public
policy, and has been at the heart of many elections as candidates vie for voters oriented
toward less government and more market-based freedoms and those who favour increased
equality of resources and aggressive regulation of markets.
Globalization has undoubtedly contributed to global economic growth. Throughout the
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1980s, according to World Bank data, the world economy grew by an average of 3.3 percent
a year, but during the 1990s, it grew by an average of 2.7 percent a year. Even in 2001,
when global growth was only 1.1 percent, that translated into an increase of more than $300
billion in economic output. Total global household consumption grew from US$12.9 trillion
to US$18.9 trillion between 1990 and 2001, a 3.3 percent rate of growth. But economic
growth has been uneven:
The high growth rates in China and other East Asian and Pacific countries mask much more
modest improvements in the economies of other poor countries, and economic prospects
continue to weaken in Sub-Saharan Africa. World Bank data on the growth in household
expenditures between 1980 and 2001, for example, show that growth has occurred in South
Asia and the East Asia and Pacific region in contrast to little growth in Latin America and a
decline in Sub-Saharan Africa.
In the United States, economic governance is central to debate between Republicans and
Democrats regarding public policy. Republicans have been champions of tax cuts and
supplyside economics, reduced regulation of business, and subsidies to key industries.
Democrats counter with more redistributive tax policies, increased regulation to protect
environmental and other values, and increased investment in programs to help low-income
residents. Republicans champion an ownership society that maximizes individual freedom;
Democrats focus on equal opportunity and empowering those who cannot compete in labor
markets without some help.
Some argue that economic issues are eclipsed by concern with moral values or that the
similarities between the two parties and their pursuit of campaign contributions and support
from industry dwarf any differences, but economic governance is clearly a contested issue.
Average Annual Growth in Per-Capita Household Expenditure
1980–1990 1990–2001
Low-income countries 1.9 1.6
Middle-income countries 1.1 2.5
East Asia and Pacific 4.8 5.6
Europe and Central Asia na 0.8
Latin American and
-0.6 2.0
Caribbean
South Asia 3.1 2.4
Sub-Saharan Africa
High-income countries 2.7 1.9
Source: Adapted from World Bank. (2003). 2003 World Development Indicators (p. 224).
Washington, DC: Author.
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The apparent polarization of this debate in the United States masks a fundamental truth of
economic governance—that markets depend on a variety of public policies to ensure they
actually produce the important and valuable benefits they promise, to secure the stability and
public order required for economic activity to flourish, and to guarantee the health of the natural
environment on which it depends. Regardless of the ideological debate between Republicans and
Democrats and proponents and critics of globalization, capitalism inescapably depends on
institutions of government for a host of functional policy prerequisites of markets, including the
following:
 Securing law and order so that production, marketing, and distribution of goods and services
can occur in a stable environment
 Creating private property rights by providing courts and other mechanisms to define and
vindicate rights
 Enforcing contracts so that commerce can occur
 Ensuring fair competition through enforcement of antitrust policies
 Establishing currency and credit for the efficient conduct of commerce
 Providing for the conveying of the public domain to private ownership
 Requiring disclosure of information so that consumers and investors can make informed
choices
 Providing public goods such as communications and transportation infrastructure and
national defense
 Allocating responsibility for injury and dependency and indemnifying injuries
 Preventing externalities that harm third parties or those not part of market transactions
 Regulating production and distribution so that prices include true costs
 Facilitating economic activity through licensing of professions and corporations
 Developing basic workplace skills through compulsory public education
 Reducing risk by indemnifying producers and sellers of products against responsibility for at
least some of the uses of the products they produce and sell.
Capitalism simply cannot produce the expectations of efficient allocation of resources and
satisfying human needs without effective public policies. A brief review of the leading
institutions for economic governance reinforces the importance of capitalism‗s policy
prerequisites.
In Congress, the House and Senate Budget Committees, the House and Senate Appropriations
Committees, the Senate Finance Committee, and the House Ways and Means Committee are
potent forces in economic governance as they develop tax legislation, authorize spending levels,
appropriate funds, and develop fiscal or budgetary policy. The Congressional Budget Office,
established in 1974, serves members of Congress by providing an overview of the federal budget
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and its economic impacts and assessing the fiscal and budgetary implications of legislative
policy options and alternatives. Its most important tasks include preparing cost estimates for
implementing any public bill or resolution passed by a congressional committee and keeping
score of the costs of authorization, appropriation, and revenue bills relative to the targets
provided in the federal budget.
A host of executive branch agencies are involved in economic governance. Some are located in
the executive office of the president. The Council of Economic Advisers, for example, is made
up of three members, who advise the president on economic issues, evaluate federal economic
programs and policies of the federal government, and issue an annual report on the economy.
The Office of Management and Budget, originally created as the Bureau of the Budget in 1939,
serves the president by formulating the executive branch‗s annual budget and overall fiscal
policy, evaluating the management and programmatic efforts of federal agencies, coordinating
departmental advice to the president on proposed legislation, monitoring paperwork and
regulatory impacts imposed by federal agencies, and improving procurement practices of federal
agencies.
The range of economic activities that comes under the jurisdiction of cabinet departments sweeps
across all sectors. The Department of the Treasury, created in 1789, is the most important
institution of economic governance in the United States. It provides advice to the president on
economic, financial, tax, and fiscal policies; manufactures the nation‗s coins and currency;
enforces policies governing taxation of alcoholic beverages and tobacco; and serves as the
financial agent for the federal government. As the government‗s agent, the department controls
the flow of funds and trade to foreign countries whose assets are ―blocked,‖ manages the
government‗s debt, conducts financial diplomacy with other nations, oversees U.S. participation
in the International Monetary Fund (IMF) and bilateral and multilateral development institutions,
analyzes balance of trade and other economic data, formulates and implements international tax
agreements and regulations, and collects taxes through the Internal Revenue Service. The
department is responsible for implementing domestic tax policies; overseeing government trusts
and accounts; supervising the 2,100 national banks, issuing bank charters, and examining bank
operations; and regulating federal and state-chartered savings institutions. The Bureau of the
Public Debt borrows the money needed to finance the federal government and manages the
nation‗s debt.
In addition to executive office of the president and cabinet agencies, an array of independent
regulatory commissions helps govern economic activity. The Federal Reserve System or Fed,
established in 1913, is the nation‗s central bank, responsible for formulating and implementing
credit and monetary policy. The Fed, along with the Treasury Department, is tremendously
important in economic governance. The system consists of the Board of Governors in
Washington, DC; the twelve Federal Reserve Banks, their twenty-five branches and other
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facilities situated throughout the country. The Fed seeks to foster the strength and vitality of the
nation‗s economy by managing the cost and availability of money and credit, stabilizing prices,
maintaining equilibrium in America‗s international balance of payments, ensuring the stability of
the nation‗s banks, and acting as a lender of last resort to banks. The Fed‗s board of governors,
composed of seven members appointed by the president with the advice and consent of the
Senate, determines overall monetary policy and influences the conditions under which credit is
available by determining the requirements concerning reserves depository institutions must
maintain on transaction accounts or nonpersonal time deposits and the discount rate charged by
the Federal Reserve Banks.
The Fed‗s open market operations include the purchases and sales of federal government and
agency securities in the open market to shape bank reserves; the Fed lends money to banks so
they can meet the reserve requirements, and the interest rate it charges helps shape interest rates
economywide. The Federal Bank of New York is responsible for protecting the value of the
dollar in international exchange markets. Other regulatory agencies play key roles, from the
Securities and Exchange Commission, which implements Federal securities laws aimed at
protecting investors and ensuring that securities markets operate fairly, to the Federal Trade
Commission (as well as the Department of Justice) that regulates companies to ensure that they
do not collude in setting prices or other business decisions that concentrate economic power or
reduce competition in violation of the nation‗s antitrust laws.
Economic governance requires effective governance to ensure regulatory rules protect workers,
investors, environmental quality, and other important public values. Despite some rigid
ideological thinking, the importance of effective economic governance in the United States has
been well established for decades and largely withstood attacks from the Right since the 1980s.
Globally, however, the need for effective economic governance is much less recognized. A
World Bank report in late 2004 stated that the widening gap between rich and poor nations is
partly the result of the quality of business regulation; excessive regulation in some countries,
particularly poor nations in Sub- Saharan Africa, stifles business activity and contributes to
poverty. Rather than recognizing the complex forces unleashed by global competition and the
need for effective public policies to ensure markets function efficiently and effectively, however,
globalist market ideology seeks to weaken governmental capacity and authority and insulate
industries from regulatory authority.
One way globalism challenges the kind of economic governance that is actually required for
well-functioning markets is through its neoliberal ideology of growth, individual freedom, and
prosperity. Globalist discourse promises to replace irrational politics with rational markets,
replace political authority with unfettered freedom, and integrate the poor into a global
marketplace. Globalization is touted as benefiting everyone, creating wealth and opportunity,
disseminating information and culture, and reducing poverty. In practice, critics argue, globalism
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primarily advances the material interests of those entities that benefit most from minimal
government intervention in economic activity.
Another way globalism threatens economic governance is by stigmatizing politics and

government as an unnecessary burden blocking the acceleration of economic growth. One
current strategy of stigmatization is the privatization of services that have traditionally been seen
as governmental functions, such as energy production and prisons (this does not raise the same
issues as privatizing previously nationalized industries). Another strategy of stigmatization
utilizes deregulation and reduction of government licensing and control of economic activity to
leave more market activity unregulated. Yet another relevant strategy is to devolve regulatory
power to local governments— welfare reform, for example, has increased regulatory controls
over poor women by local governments, while local police forces have sometimes been
expanded well beyond that required to match population growth.
Devolution, for example, concerned with the scope of government and its jurisdiction, is
promoted as a way to ensure that government is close to the people so that they can hold
government accountable and that there is sufficient knowledge to make good policy and guide its
implementation. The U.S. experience with devolution is instructive. Under the Constitution, the
powers of the national government were limited to the husbandry of commerce and patronage
policies, aimed at fostering economic activity. States exercised the police power, the power to
control health, safety, and morals. States regulate property, corporate formation, marriage and
divorce, compulsory education, and professional licensing. As a result, the national government
became the home of liberalism, and state governments became the home of conservatism.
National policies have traditionally been primarily liberal, instrumental, and generally free from
moral imperatives.
State policies have typically been imbued with moral purpose, regulating harmful conduct—
conduct deemed inherently harmful as well as those deemed harmful because of their effects.
Most state-level laws are conservative, aimed at preserving law and order, sexual morality, and
other values. The political consequence of devolution is to strengthen conservatism: local
governments are inherently conservative, focused on maintaining social order, keeping classes
and groups in their place, and keeping the poor invisible through segregation. Federal block
grants to cities have been used to segregate groups through urban development and
redevelopment.
Cities used their discretionary power and resources to contain people in their places and to
maintain social relationships. Globalization, then, has a Rightward tilt in rejecting redistributive
policies and requiring local government to control the spillover effects of inequalities. During the
past fifteen years, the Rightward shift is evident worldwide, in the most industrialized countries
as well as those transitioning to industrialization. Left parties have moved to the center and
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beyond. Cities throughout the world are segregated along class, ethnic, and religious lines and
designed and organized for social control. A corollary of the maxim, all politics is local, is that
all social control is local. As cities become more tied to their tax bases, they become more
oriented toward the interests of property owners and those with wealth. The devolution that may
be most important is the police power and increases in the number of police officers. Although
the response to globalization is national, social control policies are expressed and implemented
locally.
Economics may drive globalization, but politics must pick up the pieces. And globalization
weakens the ability of government to provide the preconditions that make capitalism possible.
4.3 Culture Governance
Culture governance refers to a specific, top-down steering mechanism designed to improve elite
control over the outputs of highly complex systems, like the modern democratic welfare state.
Where once effective governance was a matter of a hierarchical, bureaucratic state exercising
control, the demands placed on post-industrial governments require that their constituents
perceive themselves as stakeholders to assure the continued functioning of the system.
Consequently, leaders and managers create associations that span the traditional divide between
state and civil society to draw in the knowledge and participation of citizens and groups at all
levels in order to shape it into forms most disposed to their continued control. Strategies like
―The Third Way‖ and ―EU Good Governance‖ are examples of attempts at culture governance.
The rise of culture governance is a response to the challenges to modern political systems posed
by the effects of globalization. Transnational and subnational political entities pull from above
and below, respectively, eroding state sovereignty. The increasing integration of national
economies into a world market has undermined the capacity of these systems to carry out
expected responsibilities like public spending, welfare, and other social services. The rapid and
free flow of people and ideas undermines traditional conceptions of identity based on nationality
or location. Within this environment, there is a growing recognition that given their complex and
highly differentiated nature, modern political systems can no longer govern in a coherent and
effective manner only by means of commands, directives, warnings, or patriotic appeals.
Instead, they must actively empower, mold, and incorporate the ideas and values of citizens and
civil society into the governing process. By expanding the role of self and cogovernance among
the populace, systems can more effectively deliver expected services and increase the legitimacy
of their decision making. While more cooperative and inclusive than traditional, hierarchical
authority, culture governance is still an elite-directed steering tool. Citizens are empowered and
courted, but for the sake of the system, not their own. Consequently, culture governance poses a
unique challenge to the foundations of representative government. Culture governors seek to
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connect with the polity down to the individual level through new, dedicated networks to make it
amenable to their policy directions. By bypassing established mechanisms like national parties
and big interest groups, elites undermine the authority of traditional political institutions.
Moreover, the efforts to preprogram public reasoning, even at the most basic level, imperil the
necessarily spontaneous and freewheeling nature of political association at the grassroots level.
As such, culture governance threatens to supplant the politics of the ordinary by coopting even
the most mundane political discourse with an underlying imperative to maintain and improve the
existing system.
Third Way
Historically, the term third way has been used in a multitude of ways to refer to a variety of
forms of governance—from Nordic social democracy to fascism. In its most recent incarnation,
it was deployed first by then Director of the London School of Economics, Anthony Giddens, in
a string of influential publications from 1998 to 2002 to refer to an alternative to both
neoliberalism and social democracy in an era of globalization. It has been associated most clearly
with the New Labour administration of Tony Blair in Great Britain, but also, if less directly, with
a number of Center-Left administrations, notably those of Bill Clinton‗s New Democrats in the
United States and Gerhard Schröder‗s Social Democratic Party (SPD) in Germany. The term is
taken to variously refer to a new and distinctive policy program, to a new political economy, to a
new conception of social justice, and, by many of its critics, to a Center-Left capitulation to
neoliberal globalization.
Anthony Giddens is relatively specific as to the policy content of the third way, distinguishing it
unequivocally from both neoliberalism to the Right and a ―traditional‖ conception of social
democracy to the Left. But herein lies the first potential confusion.
Though clearly framed in the first instance to chime with the mood of modernization associated
with the birth of New Labour in Great Britain, the aspirations for the third way have grown over
time. So too has its intended audience. It is now presented as a guide to good governance,
appropriate to conditions of globalization and complex economic and social interdependence for
developed and developing economies alike, as Giddens noted in 2002. Yet arguably it continues
to betray its origins in domestic British political discourse. For instance, the conception of social
democracy, from which it distances itself, is scarcely recognizable to students of the latter‗s
distinctive (and arguably defining) Nordic/Scandinavian form.
Indeed, the conception of social democracy to which Giddens‗s third way is a response in fact
owes far more to Great Britain‗s peculiar experiments with corporatism in the 1960s and 1970s
than it does to the continental European tradition of social democracy— a tradition to which the
British Labour party and never really belonged. Indeed, the rather ambiguous nature of the
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relationship between the third way and social democracy is merely compounded by periodic
references to the third way as a ―modernized‖ social democracy fit for the new prevailing social,
political, and economic landscape of contemporary capitalism. This sits uneasily alongside the
idea of the third way as ―beyond Left and Right,‖ that is, beyond social democracy and
neoliberalism.
Yet whether conceived as an alternative to, or an updating of, the social democratic tradition, the
central and defining features of the third way are set out very clearly by Giddens:
1. A commitment to the seemingly paradoxical notion of the radical centre and, with it, to the
idea that a modernizing Center-Left administration can draw radical zeal from Left and Right
simultaneously
2. An emphasis on the ―new democratic state‖ and with it a commitment to a more open and
dialogic conception of international politics (and, rather naively, as it was to turn out, to
―states without enemies‖), to raising environmental consciousness and, domestically, to a far
more transparent, direct, and open form of participatory government that empowers the
citizen
3. An associated emphasis upon a more active and engaged civil society that has taken greater
responsibility for its own governance through a proliferation of more community-based
initiatives and an expanded role for the third sector
4. A commitment to the sustenance by public policy of the ―democratic family‖ and with it an
associated emphasis upon support for coparenting, gender equality, and life-long parental
contracts
5. An emphasis upon the ―new mixed economy‖ and an acceptance (from neoliberal variants of
public choice theory) of the need for public-private partnerships, private finance initiatives,
and the incentivization of consumer-friendly public service provision
6. A commitment to ―equality as inclusion‖ and with it a far greater emphasis upon providing
appropriate opportunities for citizens to improve themselves (for instance, investing in their
own human capital) rather than the pursuit of equality of outcome
7. An associated commitment to the notion of ―positive welfare‖ and of ―no rights without
responsibilities‖
8. A commitment to the development of the ―social investment state‖ and to the use of public
resources to build the national stock of human capital, thereby contributing to
competitiveness and good economic performance
9. An emphasis upon the development of a genuinely ―cosmopolitan nation‖ celebrating

cultural diversity and pluralism
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10. A commitment to extending such cosmopolitan values into the international areas through a
democratization of the institutions of global governance
This is undoubtedly an original and distinctive combination of programmatic commitments and
one that clearly draws inspiration from both Left and Right.
However, what is perhaps odd is that having set out to chastise traditional social democracy, the
third way seems to embrace a series of policy goals that arguably have been most successfully
pursued in social democratic regimes. Notable here is the third way‗s commitment to raising
environmental consciousness (and standards), to the democratic family, to coparenting, to greater
gender equality, and to a social investment state. These have been mainstays of continental
European social democracy throughout much of the postwar period; arguably traditional social
democratic regimes continue to enjoy far greater success in fulfilling their commitment to these
goals than those states whose leaders have come to embrace the third way.
A second interesting point is that the political economy of the third way is seemingly rather
underdeveloped. Indeed, if much of the social and ecological policy innovation of the third way
can—or at least could—trace a direct lineage from traditional social democracy, the economic
policy content seems decidedly neoliberal in tone. Notable here is the enthusiastic endorsement
of market and quasi-market mechanisms in the delivery of public services and in the
incentivization of public-sector performance. This is particularly significant because, it seems,
much of the third way is about scaling back social democratic expectations and ambitions so they
do not challenge economic competitiveness in an era of globalization.
Although it is rarely presented in such terms, this may suggest the third way is underpinned
centrally by an understanding of the constraints imposed on Center-Left administrations by
globalization. Indeed, the third way is perhaps best seen less as a self contained ethos and
conception of social justice informing policy rather than as a more pragmatic downscaling of
social democratic aspirations to an age of diminished policy-making autonomy. Again, this
reveals a certain ambiguity at the heart of the third way.
Its pragmatism and realism in the face of insurmountable, external, and (largely) economic
constraints is prominent. Yet, simultaneously, it is invariably held by its advocates providing a
guiding ethic and a universal conception of social justice to inform policy choices in a
programmatic way. As such, we might expect it to provide an exacting ethical standard against
which, for instance, contending economic and social policy choices might be gauged. Yet the
third way tends not to hold economic and social policy accountable to an ethical standard so
much as to construct a standard of perceived political economic viability against which any
ethical considerations must first be assessed. Indeed, it seems, particular perceptions of political
economic constraints—associated in particular with globalization—impose a recalibration of a
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more traditional social democratic ethos. It is in this sense that the third way is an updating of
traditional social democracy.
It seeks to retain those elements of a social democratic ethos that are still held to be compatible
with economic growth in an era of presumed globalization. As this suggests, despite impressions
to the contrary, third way political economy comes prior to its ethics. Indeed, it is assumed to
both correspond to, and arise naturally out of, an economic reality that has rendered social
democracy redundant. As this makes clear, the third way rests upon a set of economic
assumptions—about the extent and nature of globalization and the degree to which it is
incompatible with social democracy. Yet those economic assumptions are far from unquestioned
and, as a growing body of scholarship now shows, are in fact increasingly difficult to reconcile
with the empirical evidence. Despite the third way‗s reliance upon a particular, and now
contested, conception of economic constraint associated with globalization, in economic policy

terms at least, what it sanctions or embraces is far from clear; it is far clearer about what it rejects
than what it sanctions or embraces. The third way rejects Keynesianism, the economic theory of
John Maynard Keynes. Moreover, if taken to imply an unconditional right of access of all
citizens to a comprehensive welfare state, a belief in democratic economic governance (as
distinct from the governance by the economy of the realm of political choice), and a commitment
to egalitarian social outcomes (as distinct from opportunities), it is post–social democratic. More
substantively, it rejects nationalization, interventionism, active industrial policy (which it
characterizes as ―backing losers‖), what it sees as regulation for its own sake, deficit financing,
corporatism, and the appeasement of labor more generally.
This excepted, there is no sustained discussion of the economy in Giddens‗s 1998 work, The
Third Way. That discussion came in 2000, in The Third Way and Its Critics. Here, having
acknowledged the criticism that there is no economic policy content to the third way, Giddens
retrospectively linked the ethical vision outlined in The Third Way to a new Keynesianism,
with which he can hardly be said to be fluent. This is never fleshed out in any detail. Giddens
makes a passing reference to the importance of policy for the supply side of the economy.
Similarly, the importance in the new knowledge economy of investment in human and, indeed,
social capital is included. Together, these underdeveloped remarks exhaust the substantive
content of third way political economy. Given that the third way presents the economic aspect as
circumscribing the parameters of policy autonomy in a quite fundamental way, this comparative
silence is all the more remarkable. The need for an alternative to the first and second ways
(neoliberalism and social democracy respectively) is presented in economic terms. Yet the case
is never made. Consequently, the third way, unlike other political philosophies or conceptions of
social justice, demands an economic analysis that it does not provide.
This has serious implications for the conception of social justice that it is capable of articulating.
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Any consistent conception of social justice is compromised by the perceived need to scale one‗s
ethical aspirations in accordance with assumed (economic) constraints and imperatives. In other
words, rather than defend, in its own terms and from first principles, a particular conception of
social justice, the third way must choose its conception of social justice pragmatically, having
first eliminated all those deemed incompatible with the harsh economic realities of a global era.
Where issues of equity and economic efficiency are seen to clash, the overriding imperative is
economic growth. Social solidarity and, one must presume, social justice are viewed as
something of a luxury: desirable, certainly, but only where the imperatives of the former allow.
What this in turn suggests is that if a distinctive third way ethic emerges, it is more by chance
than by design or conviction.
This makes the status of the third way as a guiding political ethos somewhat unclear. In strictly
ethical terms, is it normatively superior to the social democratic ethos it seeks to replace? Or is it
merely the best one can aspire to when the (presumed) incompatibility between social democracy
and globalization is acknowledged? Is the third way the best in this best of all possible worlds, to
paraphrase Candide‗s Doctor Pangloss? Or is it the best conceivable ethos in a world of
diminished expectations and radically circumscribed political autonomy? One thing is clear— it
is disingenuous to present it as both.
This brings us to a final observation. The third way does not provide an ethic that can inform
future policy choices so much as a language that legitimates choices that have already been
made. Presented with a particular policy challenge, it would be difficult to argue that a quick
read of Giddens‗s Third Way might allow one to derive the ―correct‖ policy response, as distinct
from the language that defends policy choice. There is no single third way answer to the
question, should an economy have a minimum wage? The third way supplies an ethical lexicon
with respect to which either choice might be legitimated; it does not provide discriminating
ethical standards that might inform the choice itself. Herein lies its much-vaunted pragmatism.
New Labour policy is legitimated not by appeal to ethical standards and principles but with
respect to the presumed truth of certain social (and economic) facts. This is nowhere more clear
than in the economic sphere. The third way rests on a set of presumed truths about the economic
context in which Center-Left economic governance is played out. Such ―truths‖ rest on strong
claims about globalization, whose validity is now seriously challenged.
4.4 Multilevel Governance
Multilevel governance describes the dispersion of authoritative decision making across multiple
territorial levels. It emerged to explain the changing nature of the European Union (EU) and,
particularly, the changing relations between supranational, national, and subnational actors. Like
the differentiated polity, multilevel governance raised questions about the power and role of the
state. Specifically, it argued that decision- making competencies within the EU were shared and
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contested rather than monopolized by national governments; that collective decision making in
the EU implied a significant loss of power for individual governments; and that political arenas
are interconnected and overlapping rather than being nested, with supranational, national, and
subnational actors involved in exchange relationships in transnational policy networks. Thus,
multilevel governance emphasized both the increased vertical interdependence of actors
organized at different territorial levels and the growing horizontal interdependence between
governments and nongovernmental actors. Liesbet Hooghe and Gary Marks have identified two
different types of multilevel governance. The first type conceives the dispersion of authority as
being restricted to a limited number of non-overlapping jurisdictional boundaries at a limited
number of levels. This type is characterized by relatively stable authority, and analysis is focused
on particular levels of government rather than on specific functions or policies. The second type
emphasizes fluidity and a complex patchwork of innumerable overlapping jurisdictions. Here,
authority is located around particular functions, and jurisdictions are more flexible to cope with
changing demands.
The Multilevel Polity
Ian Bache and Matthew Flinders drew on the insights of both multilevel governance and the
differentiated polity to develop a framework for analyzing the changing nature of British
government and politics in the context of political and administrative devolution and the growing
influence of the EU. Aspects of multilevel governance overlap with those of the differentiated
polity, most obviously in emphasizing policy networks and challenges to state power demanding
new methods of coordination and conflict resolution. However, multilevel governance
emphasizes vertical interactions and, in particular, challenges the traditional separation between
the domestic and international arenas, highlighting the intersection of internal and external
jurisdictions. This multilevel dimension has been criticized for over-emphasizing vertically
layered interactions to the detriment of no less important horizontal interrelationships. However,
in the changing context of British government and politics characterized by political and
administrative devolution and the increasing influence of supranational elements, the multilevel
dimension is valued for highlighting the increasing importance of vertical interactions.
The multilevel polity approach acknowledges that aspects of the Westminster Model were
always something of a diversionary tactic to be validated or falsified in empirical research and
that key components of it had long been problematic. However, the approach suggests that by the
end of the twentieth century, devolution and EU membership in particular had instigated
fundamental changes in the nature, scale, and intensity of inter-organizational relationships in
British politics. Despite this, the extent to which central state power had been weakened rather
than transformed remained an empirical question, the answer to which was likely to vary across
time, policies, and domestic territories. Despite these practical developments and conceptual
challenges, the Westminster Model has not entirely evaporated. At the start of the twenty-first
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century, the model continued to condition aspects of the British political culture, underpinned the
belief
Contrasting Organizing Perspectives: Westminster Model and Multilevel Polity

Westminster Model Multilevel Polity
 Centralized state  Disaggregated state
General Principles
Hierarchy Heterarchy
Control Steering
Clear lines ofaccountability  Multiple lines of accountability
External Dimensions
Absolute sovereignty Relativesovereignty

 National foreign policy  Multiple foreign policies
Internal Dimensions
Unitary state  Quasi-federal state
 Parliamentary sovereignty  Inter-institutional bargaining
 Strong executive  Segmented executive
 Direct governance  Delegated Governance
 Unified civil service  Fragmented civil service
 Political constitution  Quasi-judicial constitution
 National Govt foreign policy  Multiple foreign policies
Evolution
In the context of moves to complete the single market, and to assimilate Greece, Portugal, and
Spain into the community, the Commission and its allies in the European Parliament won
support from governments for a major reform of structural policy in 1988. As a side-payment to
poorer member states for the anticipated consequences of the internal market programme,
governments agreed to double allocation of structural funding to assist the development of
disadvantaged regions. As part of the desire to ensure effective use of these funds,
governmentssome reluctantly- accepted the commission‗s proposal that funds be administered
through
partnerships established within member states, consisting of representatives of national, regional
(and/ or local), and supranational actors (namely, the commission). It was from a study of these
How should we define multi level governance?
How is multi-level governance utilized by scholars working in different disciplinary traditions?
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How do the structures and processes of multi-level governance differ across policy sectors and
how can these differences be explained?
Does multi-level governance connote hierarchy? If so, is this a weakness in the approach?
What implications does multi-level governance have for the power, position, and role of the
nation state?
Does multilevel governance indicate an erosion of the nation state, as is often assumed, or does
it lead to a as is often assumed, or does it lead to a transformation or reorganization of state
power?
In particular, what evidence is there of national governments attempting to increase their steering
capacity in the context of multi-level governance?
What are the implications of multi-level governance for democratic accountability?
What are the limitations of multi-level governance model?
Contrasting visions of multi-level Governance Gary Marks and Liesbet Hooghe
Centralized authority has given way to new forms of governing. Formal authority has been
dispersed from central states both up to supranational institutions and down to regional and local
governments. A recent survey finds that sixty-three of seventy- five developing countries have
been undergoing some decentralization of authority (German et al. 2001:25). No EU country
become more centralized since 1980, while half have decentralized authority to a regional tier of
government (Hooghe and Marks 2001). The 1980s and 1990s have also seen the creation of a
large number of transnational regimes, some of which exercise real supranational authority. At
the same time, public/ private networks of diverse kinds have multiplied from the local to the
international level
The diffusion of authority in new political forms has led to a profusion of new terms: multi-level
governance, multi-tiered governance, polycentric governance, multi-perspectival governance,
functional, overlapping, competing jurisdictions (FOCJ), fragmentation (of spheres of authority),
and consortio and condominio, to the name but a few. The evolution of similar ideas in different
fields can be explained partly as diffusion from two litratures- federalism and public policy. But
we suspect that this conceptual invention has independent sources.
Available literatures on the topic agree that dispersion of governance across multiple jurisdiction
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is more efficient than, and normatively superior to, central state monopoly (Marks and Hooghe
2000). They claim that governance must operate at multiple scales in order to capture variations
in the territorial reach of policy externalities. Because externalities arising from the provision of
public goods vary immensely- from planet-wide in the case of global warming to local in the
case of most city services- so should the scale of governance. To internalize externalities,
governance must be multi-level. Apart from this core argument, a number of supplementary
explanations have also been made in this context. For instance, more centralized jurisdictions can
better reflect Heterogeneity of preferences among citizens. Multiple jurisdictions can facilitate
credible policy commitments (Pollack 1997; Majone 1998). Multiple jurisdictions allow for
jurisdictional competition (Weingast 1995; Frey and Eichenberger 1999), and they facilitate
innovation and Experimentation (Grey 1973).
However, beyond the presumption that governance has become (and should be)
multijurisdictional, there is no agreement about how multi-level governance should be organized.
We detect two contrasting visions.
The first conceives of dispersion of authority to jurisdictions at a limited number of levels. These
jurisdictions- international, national, regional, meso, local-are general-purpose. That is to say,
they bundle together multiple function, including a range of policy responsibilities, and in many
instances, a court system and representative institutions. The membership boundaries of such
jurisdiction do not intersect. This is the case of jurisdiction at any one level and it is case of
jurisdiction across level. In this form of governance, every citizen is located in a Russian Doll set
of nested jurisdictions, where there is one and only one relevant jurisdiction at any particular
territorial scale. Territorial jurisdictions are intended to be, and usually are, stable for several
decades or more, though the allocation of policy competencies across levels is flexible.
A second vision of governance is distinctly different. It conceives of specialized jurisdiction that,

for example, provides a particular local service, solve a common pool resource problem, select a
product standard, monitor water quality in particular river, or adjudicate international trade
disputes. The number of such jurisdictions is potentially huge, and the scale at which they
operate vary finely. And there is no great fixity in their existence. They tend to be lean and
flexible. They come and go as demand for governance change.
Multilevel governance is an approach that, for academics from a range of subdisciplines of

political science, captures the increasingly fragmented and complex nature of decision making in
a number of settings. Multilevel governance draws on frameworks and concepts from across sub
disciplines, particularly from European Union (EU) studies, international relations (IR), and
public policy. As such, multilevel governance contributes to a growing awareness that many
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contemporary issues and problems cannot be understood without crossing traditional academic
boundaries.
Most specifically in this case, multilevel governance crosses the traditionally separate academic
domains of domestic politics and international politics. The distinction between what is domestic
politics and what is international politics is challenged by empirical developments, particularly in
the European context, where the EU has taken on an increasing number of functions previously
undertaken by nation states. It is no coincidence that multilevel governance first emerged from
studies of the EU.
For many, the EU is not really like traditional international organizations or domestic political
systems. It is something unique and, as such, defies explanation purely from approaches applied
either to ―politics within states‖ (domestic) or ―politics between states‖ (international).
Multilevel governance was first developed to capture the changing nature of EU structural policy
following a major reform in 1989, and was subsequently applied to EU decision making more
broadly.
Until the mid-1980s, theorizing about the EU had been dominated by approaches derived from
the study of IR. From the IR tradition of pluralism, neofunctionalism was developed to
understand European integration, whereas those in the state-centric IR tradition applied
intergovernmentalism. The concern of theorists in these traditions was with explaining the nature
and pace of European integration. Neofunctionalists argued that national governments were
increasingly caught in a web of interdependence with nonstate actors, EU institutions, and other
governments that took them further along the road to integration than they intended. By contrast,
intergovernmentalists emphasized the degree of control national governments retained in the
process as gatekeepers over the key decisions. From the reenergizing of the European integration
process in the 1980s, symbolized by agreement to the completion of the single European market
and the Mediterranean enlargement, the EU began to take on more functional responsibilities and
develop more effective decision-making mechanisms. In particular, qualified majority voting
displaced unanimity voting in a range of policy areas. This change occurred primarily to expedite
swift agreement to the measures needed to complete the single market, but had implications
beyond market integration. This shift limited the ability of individual governments to veto
proposals that they believe are against their national interest.
The relaunch of the integration project and the related institutional reforms sparked a new wave
of thinking about the EU, which drew parallels with domestic systems. Subsequently, a range of
tools and concepts were increasingly applied to the EU from the study of domestic and
comparative politics, and new concepts were developed. The development of multilevel
governance was part of this new wave of thinking about the EU. Its origins in the study of EU
structural policy provide useful insights into the nature and development of the concept.
EU Structural Policy and Multilevel Governance
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EU structural policy aims to promote social and economic cohesion across Europe. Much of its
focus is on assisting the development of disadvantaged regions in the context of market
integration. In the context of moves to complete the single market, and to assimilate Greece,
Portugal, and Spain into the EU, the European Commission and its allies in the European
Parliament won support from governments for a major reform of structural policy in 1989.
Largely as a side payment to poorer member states for the anticipated consequences of the
internal market program, governments agreed to double the amount of funding spent through
structural policy and to reform its governing principles.
As part of the desire to ensure effective use of these funds, governments—some reluctantly—
accepted the commission‗s proposal that funds be administered through partnerships established
within member states, consisting of national, subnational (regional or local) and supranational
(commission) actors. This decision gave subnational actors a formal role in the EU policymaking
process for the first time. In subsequent years, the commission pushed for and secured
agreement to the greater involvement of nonstate actors (nongovernmental organizations, trade
unions, environmental groups, etc.) within these partnerships.
The concept of multilevel governance was developed from a study of these developments.
Initially, the study highlighted ―continuous negotiation‖ among governments ―nested‖ at
different territorial levels. The analysis drew on the policy networks approach to highlight the
territorial overarching networks in which governments found themselves increasingly enmeshed.
Although not a theory of integration, the approach had strong neofunctionalist antecedents in its
argument that supranational actors and interest groups were significant in shaping the
commission‗s decisions and that this challenged the role and authority of national governments.
Increasingly, multilevel governance scholars paid attention to nonstate as well as government
actors.
Thus, multilevel governance has both vertical and horizontal dimensions. The former
(multilevel) refers to the increasing interdependence of actors situated or nested at different
territorial levels—supranational, national, and subnational; the latter (governance) refers to the
increased role of nonstate actors in decision making. In short, therefore, the rise of the
subnational level and acknowledgement of the significance of policy networks combined to
stimulate the initial conception of multilevel governance in EU studies.
If the initial trade in concepts had been from the study of domestic politics and IR to EU studies,
the development of multilevel governance offered the possibility of concept trading in the other
direction. Over the period since multilevel governance was first developed, internationalization
and decentralization/devolution have accelerated as trends, as has the growing participation of
nonstate actors in public policy making. As such, scholars from different academic traditions
seeking to understand increasingly contested jurisdictional and territorial boundaries both within
and beyond states have used multilevel governance.
Two Types of Multilevel Governance
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In clarifying the concept, Liesbet Hooghe and Gary Marks distinguished between two types of
multilevel governance. Type 1 multilevel governance resembles federalism. It sees the dispersion
of authority as being restricted to a limited number of (non-overlapping) jurisdictional
boundaries at a limited number of territorial levels. Here, jurisdictions are general purpose with
those jurisdictions at the lower territorial levels nested into higher ones. In this typology, the
distribution of authority is seen as relatively stable and the focus of analysis is on individual
governments or institutions rather than on specific issues or policies.
Type 2 multilevel governance presents a picture of governance that is more complex, is more
fluid, and consists of innumerable jurisdictions. These jurisdictions often overlap each other and
tend to be flexible as governance demands change. They are focused around specific policy
sectors and issues and devised to secure optimal policy-making efficiency. In this typology, the
distribution of authority is less stable and the focus of analysis is more on specific issues and
policy areas than on individual governments or institutions.
These types of multilevel governance are not viewed as mutually exclusive but can (and do)
coexist. General-purpose jurisdictions exist alongside special-purpose jurisdictions: Formal
institutions of government operate, and indeed create, special purpose bodies to carry out
particular tasks or address particular problems. There may be tensions between the two, for
example, in relation to issues of accountability over particular decisions and outcomes. But such
tensions are a characteristic feature of multilevel governance.
Different Uses of Multilevel Governance
Although multilevel governance was developed as an analytical framework to analyze

developments in the EU empirically (to explain how things are), the concept has also been
adopted in normative debates about how public decision making should be arranged. The phrase
has indeed been adopted by the European Commission in its policy documents and has been
debated normatively by academics. We deal with the analytical and normative uses in turn.
Analytically, the most controversial aspect of multilevel governance has been the interpretation
that it suggests that the nation-state is in irreversible decline. This may be something of a parody
of multilevel governance. Although the concept undoubtedly highlights new challenges to state
power, there is also recognition in the literature that states remain important both because they
often hold nodal positions within networks and because they have democratic legitimacy that
other actors do not possess. Different authors emphasize different outcomes from the challenges
to state power presented by multilevel governance. Although some are keen to emphasize the
loss of state power, others argue that power should not be conceptualized as zero-sum and that
the rising importance of other actors does not necessarily mean the transfer of power away from
states. Indeed, some scholars suggest states can set the ground rules for multilevel governance to
frame favorable outcomes and can mobilize other actors to help them achieve state objectives
more effectively.
768
That multilevel governance can be used in a variety of ways by different scholars may be seen as
an advantage, but it may also illustrate a weakness: that its theoretical content is weak and it is
mainly a descriptive term. It is criticized for not generating clearer expectations about the role
and influence of ―new‖ actors in the policy process and, related to this, how the role, authority,
and power of states are affected. A particular problem is that multilevel governance to some
extent equates governance with the mobilization or participation of new actors in public policy
making, irrespective of whether this mobilization or participation leads to any shifts in power
between different actors. Put differently, it refers to increasing interdependence between actors
but categorizes both the weakest, most asymmetrical relationships of interdependence and the
strongest, most symmetrical relationships in the same way.
Normatively, multilevel governance is seen by its advocates to have advantages in its scale
flexibility; that is, that jurisdictions can be designed to involve particular actors to meet
particular challenges on a particular scale to fit particular preferences. This may be either Type
1 or Type 2 multilevel governance. This custom built approach is thought to lead to efficient and
effective decision making, to have problem-solving capacity. Critics suggest that the perceived
gains in efficiency and effectiveness may have costs. In particular, the proliferation of such
jurisdictions and the increase in cross-sectoral participation risk reducing transparency and
obscuring accountability to citizens. As such, there may be a trade-off in which gains in efficient
decision making are at the expense of democratic accountability, unless new mechanisms of
accountability are developed alongside the new forms of governance.
However, not all see complex governance arrangements as an inevitable threat to democracy.
From pluralist perspectives on democracy, there may be safety in numbers in complex
governance arrangements, preventing any single actor or institution from dominating decision
making. Of course, as suggested previously, the evidence of broad participation does not equal
diffuse power. Empirically, weaker social groups tend to be marginalized in such processes
unless measures are taken to develop their capacity to engage effectively.
Taking Stock
Multilevel governance captures complex decision making in a range of settings. It has an

intuitive appeal for many scholars, but although providing an attractive description of decision
making, multilevel governance would be stronger if it generated clearer expectations in relation
to the implications for the role, power, and authority of actors involved in policy making.
Normatively, multilevel governance offers advantages for efficient decision making. However,
in some of its manifestations, there are concerns that the virtues of multilevel governance in
efficiency and effectiveness are traded for the virtues of democratic legitimacy.
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COURSE 11: GOVERNANCE AND INSTITUTIONAL REFORM
CHAPTER ONE
GOVERNANCE, INSTITUTIONS AND INSTITUTIONAL REFORMS
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1.1.Understanding Governance; why governance matters?

Governance: defined
The term governance has gained great usage in contemporary public administration. Many
theorists in the field believe that the term governance is an organizing concept that guides
administrators as administrative practices shift from the bureaucratic State to what is called the
―hollow State‖ or what Osborne and Gaebler (1993) call ―third-party government.‖ According to
Frederickson and Smith, ―Governance refers to the lateral and inter-institutional relations in
administration in the context of the decline of sovereignty, the decreasing importance of
jurisdictional borders and a general institutional fragmentation‖. Frederickson and Smith assert
further that, with more emphasis on governance, ―the administrative state is now less
bureaucratic, less hierarchical and less reliant on central authority to mandate action.
Accountability for conducting the public‘s business is increasingly about performance rather
than discharging a specific policy goal with the confines of the law.‖
The United Nations Development Programme (UNDP), in its 1997 policy paper, defined governance
as ―the exercise of economic, political and administrative authority to manage a country‘s affairs at
all levels. It comprises the mechanisms, processes and institutions, through which citizens and
groups articulate their interests, exercise their legal rights, meet their obligations and mediate their
differences‖.
In 1993, the World Bank defined governance as the method through which power is exercised in the
management of a country‘s political, economic and social resources for development. While the
World Bank has focused on stabilization and State reforms that overwhelmingly focused on civil
service retrenchment and privatization for a long period, the early 1990s saw a change of focus. The
Bank came to realize that most of the crises in developing countries are of a governance nature.
Hence, the contemporary adjustment package emphasizes governance issues such as transparency,
accountability and judicial reform. In this context, the Bank has introduced a new way of looking at
governance; good governance.
According to Jon Pierre (2000), ―governance refers to sustaining coordination and coherence among
a wide variety of actors with different purposes and objectives‖. Such actors may include political
actors and institutions, interest groups, civil society, non-governmental and transnational
organizations. This definition illustrates that while the government of a traditional State has to cope
1
with internal and external challenges from the above actors, some of the functions previously, the
preserve of government may be taken over some of the same parties. This definition gives credence
to the assertion made earlier that governance is broader than government. Governance is a broader
notion than government, state and regime because it is the interaction between formal institutions,
market and civil society in decision making. In line of this, Jacob and Sorensen (2007) agree that
governance involves not only networks that are self-governing, standing free and alone but also
networks of organizations that are guided and steered by government. In this sense, it can be said
that governance can occur without government.
Canada‘s Institute of Governance (2002), asserting that ―Governance is the process whereby
societies or organizations make important decisions, determine whom they involve and how they
render account.‖
Therefore, ―Governance‖ signifies a transformation from a type of relationship where one side
governs the other to a set of relationships where mutual interaction takes place in order to make
desirable choices for the citizens. Thus, governance forms the political, economic and administrative
power that societies use to administer their activities.
1) Economic governance includes decision-making processes that affect a country‘s economic
activities and its relationship with other economies.
2) Political governance involves the formulation of policy,
3) Administrative governance is the system of policy implementation.
When did the practice of governance emerged and how?
It emerged as a reform measure to improve the public administration system of developing
nations in order to upgrade their performance in the management of their economy in line with
the liberal ideology introduced.
The good governance debate was initially started in the 1980‘s and early 1990‘s specifically in
relation to searching alternatives to improve state performance in the management of economic
and social objectives. In the 1960‘s and 70‘s and the 80‘s development is conceived as a state led
activity through a planning frame work. In doing so strengthening public administration was the
main focus which was equivalent to what we call governance today.
To better understand emergence of the debate over governance in the 1990‘s, it would be
appropriate to look at the phases in which public administration passed through after the 1950‘s.
2
Over the past 50 years the concept of public administration has passed through four phases. In its
traditional sense public administration is perceived as a set of state structures, institutions and
processes characterized by hierarchy, continuity, impartiality, standardization, legal rational
authority and professionalism. It was expected to provide human security, protection of property,
establish and enforce societal standards and sustain the rule of law. However, it was severely
criticized for red tape, slowness, paternalism and too much focus on process than outcome.
The second phase which is called as the phase of public management is focused on the
application of management principles to public administration. These principles included
efficiency, effectiveness, and customer orientation, relevance on market forces and sensitivity to
public needs. It focused on increasing the role of private sector and minimizing the role of the
public sector. At this stage public administration mainly applied the principles of the private
sector over the public.
The third phase which is the phase of new public management (NPM) gave much emphasis on
partnership between the public and the private sector to deliver efficient service to citizens. It
also gave due attention to;
(a) that managers have to be flexible to adapt themselves with changing national and global
environment.
(b) Empowering citizens to effect more efficient and effective service delivery
(c) New management system that focuses more on innovation than the search for compliance
(d) Promoting professional ethics in the public sector
The fourth phase emerged in the 1980‘s and early 1990‘s is the phase of governance which is
conceived as a system of values, policies and institutions where by a society manages its
political, economic and social affairs through interactions between and among the state, civil
society and the private sector. It is the rules, institutions and practices that sets limits and provide
incentives for individuals, organizations and firms. Three main actors are involved in
governance; the state that creates conducive political and legal environment, civil society which
facilitates social and political interactions and the private sector that generates job and income
At its early stage of emergence, the debate over governance started as an opposite of state
dominated economic and social development programmes. In the 1980‘s and 1990‘s there were
macro-economic reform programmes implemented in the developing nations in liberalizing their
3
economies. However, problems were faced in the due course of implementing the reforms. These
obstacles were attached to the public administration system of the nations characterized by lack
of adequate legal framework for investors, weak institutions in enforcing the law, corruption and
ineffective administration. Cognizant of this proponents of good governance were preoccupied
with creating efficient institutions and rules to ensure public services are managed effectively.
At this level the key aspects of governance include; rule of law to enforce property rights and
contracts, elimination of corruption and other rent seeking activities, transparency in public
services to ensure efficiency and effectiveness, ensuring efficient services in some basic social
services like health, education etc. These aspects gave due focus to improving economic
efficiency and growth by setting conducive environment to the private sector. These in short
means minimizing the role of public institutions and promote public-private partnership.
However, gradually the good governance debate widened its scope towards improving reforming
the functioning of democratic institutions other than simply focusing on economic efficiency of
the public sector. Now a day aspect of political liberalization are also part and parcel of the
domain of what we call good governance. It has incorporated issues like deepening of
democracy, strengthening accountability and transparency, facilitating the role of non-state
actors, protection of human rights, enforcing the rule of law, access to justice and freedom in
addition to the above stated requirements to economic efficiency in the public sector.
The shift from the concern of efficient public administration towards the wider scope of good
governance has also changed the agenda for aid institutions and development assistance
providers.
The shift was from the traditional concern of efficient public sector management and
decentralization of activities to dealing with sensitive governance areas such as protection of
human rights, legislative support, judicial reform, building democratic institutions, concerns for
accountability etc.
Now a day, there is a growing relationship between the quality of governance in developing
countries and the aid and assistance provided to these countries. This resulted in raising the
number of democratic regimes who claimed to implant a system of good governance in
4
managing their state society relationship which has become an important criterion for counters
credibility and respect at the international stage.
Good Governance
Governance exists at every level of interaction and relationship, which makes the term to be very
much broader. Putting good in front of governance invites judgment about the quality of
governance in a particular context. In its universal conception, good governance can be seen in a
way that, any exercise of public authority should be aimed at maintaining increased welfare to
beneficiaries. Governance becomes good when it is able to address the allocation and
management of resources to respond to collective problems
Good governance is epitomized by a transparent process, a bureaucracy imbued with

professional ethos, an executive arm of the government accountable for its actions, a strong civil
society participating in public affairs and all behaving under the rule of law. This makes
governance to be much broader than government and good governance as a process of handling
public affairs entirely based on popular interest compared to governance as a process of
governing that could be good or bad.
Attempts to measure good governance in terms of good policies and laws could be misleading. It
may be assumed that if laws and policies are good the governance process underlying their
formulation and implementation are also good. But judging governance is about the quality of
the process of how laws and policies are made and implemented not about the quality of the
outcomes. Therefore, what makes governance good is the quality of the process in its ability to
amass and reflect wider public interest. There can be good policies with bad governance and
poor policies with good governance.
The concept of good governance has been around in both political and academic discovers for a
long time referring in a generic sense, to the task of running a government, however, since the
1980s good governance has become one of the main demonisms of development theory and
practice. It is explained that governance has three dimensions: economic, political and
administrative.
Economic governance includes the decision-making processes that affect a country‘s economic
activities and its relationships with other economies. Political governance is the process of
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decision making to formulate policy. Administrative governance is the system of policy

implementation.
Encompassing all three, good governance defines the processes and structures that guide political
and socio-economic relationships. Good governance is a new approach that includes all the
principles necessary for the consolidation of democratic management. These principles can be
stated as participation, transparency, accountability, effectiveness, consistency, fairness and rule
of law. Good governance comprises the existence of effective mechanisms, processes and
institutions through which citizens and groups articulate their interests, exercise their legal rights,
meet their obligations and mediate their differences.
The interpretation of the concept of good governance differs between development agencies. For
instance, the World Bank (WB) and the International Monetary Fund (IMF) stresses the
importance of sound macro-economic policies and the fight against corruption, while some
bilateral donors and NGOS put more emphasis on democratization and human rights,
The WB defined governance as the ―manner in which power is exercised in the management of a
country‘s economic and social resources for development‖ (World Bank, 1993).
The Bank distinguishes three distinct elements in good governance, namely: the form of political
régime, the process by which the authority is exercised in management of a country‘s economic
and social resources for development, and, the capacity of government to design, formulate and
implement policies and discharge functions.
In many countries, the WB governance agenda focused on civil service reform. There has also
been significant concern with the need to promote decentralization and building the capacity of
local governments.
Despite the efforts of various agencies to define good governance, the overall picture is good
governance covers a wide range of policy objectives; more efficient market functioning, stronger
civil society, more democracy and human rights and effective government.
UNDP identified the following essential characteristics:
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It is participatory, consensus oriented, accountable, transparent, responsive, effective and

efficient, equitable and inclusive, and follows the rule of law. It assures that corruption is
minimized, the views of minorities are taken in to account and that the voices of the most
vulnerable in society are heard in decision-making. It is also responsive to the present and future
needs of society.
Core elements of good governance
Consensus Accountability
oriented
Participation Responsiveness
Good Governance
Rule of Law Transparency
(Openness)
Effectiveness and
Efficiency Equitability & inclusiveness
1. Participation. All men and women should have a voice in decision-making, either directly or
through legitimate intermediate institutions that represent their interests. Such broad
participation is built on freedom of association and speech, as well as on the capacity to
participate constructively.
2. Rule of law. Legal frameworks should be fair and enforced impartially, particularly the laws
on human rights.
3. Transparency. This concept is built on the free flow of information. Processes, institutions
and information should be directly accessible to those concerned, and enough information
should be provided to render them understandable and monitorable.
4. Responsiveness. Institutions and processes should serve all stakeholders.
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5. Consensus orientation. Good governance should mediate differing interests in order to reach
broad consensus on the best interests of the group and, where possible, on policies and
procedures.
6. Equity. All men and women should have equal opportunity to maintain or improve their
well-being.
7. Effectiveness and efficiency. Processes and institutions should produce results that meet
needs while making the best use of resources.
8. Accountability. Decision-makers in government, the private sector and civil-society

organizations should be accountable to the public as well as to institutional stakeholders. This
accountability differs depending on the organization and whether the decision is internal or
external to an organization.
9. Strategic vision. Leaders and the public should have a broad and long-term perspective on
good governance and human development, together with a sense of what is needed for such
development. There should also be an understanding of the historical, cultural and social
complexities in which that perspective is grounded.
In general, the main elements necessary for good governance are; Consistency (predictability),
equitability or fairness, responsibility, accountability, transparency, participation
(subsidiarity), effectiveness and adherence to law. In the new millennium, societies
demonstrate and experience highly creative and efficient forms of governance and they learn
lessons from them. In this context, a new type of citizenship consciousness emerges. This new
citizenship consciousness symbolizes a new identity that acknowledges its own problems,
demands higher standards but at the same time plays an active role in the formation and
realization of these standards, that creates solutions from within and that forms the necessary
structures for this purpose.
Hence, good governance takes place at four levels in societal life: 1) Public level, 2) Private
sector level, 3) NGO level and 4) Individual level.
Firstly, good governance at the public level depends on the ability of state organs and public
service organizations to encourage participation. It also depends on a consistent, transparent, and
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accountable public administration that ensures the fairness and effectiveness of decisions and
their implementation. The cure to almost all problems that we face in the society such as
corruption, inefficiency, and improvidence is to fully adopt and implement the principles of good
governance.
Civil society organizations may assume a very important role in such a process. By cooperating
with specialized civil society organizations, the state would be able to deal with national issues in
a manner that enhances the trust in its institutions.
Secondly, good governance at the private sector level may be realized through two interlinked
channels. On the one hand, corporations themselves apply corporate governance and in line with
that they realize transparency, accountability, participatory form of management, effectiveness
and efficiency in their own management structures. On the other hand, by allocating resources
for social responsibility projects, they encourage their personnel to donate a part of their time for
the activities of civil society organizations through these projects.
Thirdly, when the civil society organizations apply good governance principles in their own
operations; that are, the principles of ―Total Quality Management‖, and choose both their own
personnel and recipients of their services based on merit-based processes, they become more
effective in entrenching good governance principles in the society.
Lastly, individuals carry an important responsibility in the realization of good governance

principles. At the personal level, every human being is a consumer, a citizen, and also an
individual with social responsibilities.
Adopting good governance principles such as consistency, responsibility, accountability,

fairness, transparency, participation and effectiveness while fulfilling these responsibilities will
contribute to the development of all sorts of institutions – including civil society organizations
and to increasing social welfare. In that way, more effective utilization of the limited resources
will be guaranteed. Therefore, each of us should demand good governance as a citizen from the
state, as a client from the companies and as an individual from the civil society organizations
while at the same time trying to become models as individuals practicing these principles. We
should not forget that the solution starts from within.
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There are certain preconditions for increasing participation which is the basis of good
governance: (i) creation of processes open to participation, (ii) bringing together the civil society
organizations which will ensure effective participation, and (iii) making sure that participants
have access to information and that necessary training for meaningful participation is provided.
1.1 Types and approaches of governance

Governance is a multi-dimensional concept that covers political, economic administrative and
other aspects. Based on this it is categorized into political governance, administrative
governance, economic governance, human governance and systemic governance. Moreover, as a
process, its practice follows different approaches as welfarist, human development,
environmental and others.
1.1.1 Types of governance

What are the main types or categories of governance?
1. Political governance: refers to the decision making and policy implementation of
legitimate and authoritative state. In doing so the state should constitute separate
legislative, executive and judicial branches that represent the interest of pluralist society
and allow their citizens to freely elect their representatives. Through political governance
a society exercises a range of processes through which it reaches in to consensus and
implements regulations, human rights, laws and policies.
2. Economic governance: refers to the decision making that directly affects a country‘s
economic activities. It has major influence on social issues such as equity, poverty and
quality of life. Economic governance is the architecture for national and international
economic activities including to manage the production of goods and services and to
marshal and protect natural, fiscal and human resources.
3. Administrative governance: is a system of policy implementation carried out through an
efficient, independent, accountable and open public sector. Here is where wider policy
frame works come into practice in a way that reflect popular needs, interests and demands.
The efficient and effective delivery of public services by the public sector is an important
element of governance that requires various government institutions to go in accordance
with public interest, to be cost effective and act within the wider framework of what
people aspires for.
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4. Human governance: in the 1990‘s the concept of human governance emanated from the
human development advocates. In contrast to good governance human governance aspires
to make the end goal of governance more people oriented focusing specifically on human
rights, global security and to do away with inhuman governance reflected in five persistent
global problems like;
 the failure to meet basic needs
 discrimination and denial of human rights to women, indigenous people and others
 failure to protect the environment and safeguard the interest of future generation
 lack of progress in abolishing war
 failure to achieve the spread of democracy
Human governance involves a set of social political and economic arrangements to make rapid
progress in these areas. It aspires to develop governance for more equitable global order where
by people‘s life is interlinked regardless of boundaries.
5. Systemic governance: The above types of governance have direct relationship with the formal
institutional and organizational structure of authoritative decision making in the modern state.
Systemic governance encompasses the process and structures of societies that guide political and
socio-economic relationship to protect cultural and religious beliefs and values, and to create and
maintain an environment of health, freedom, security, and with the opportunity to exercise
personal capabilities that lead all people to better life.
1.1.2 Approaches to governance

Can you discuss the different approaches to governance?
There are different approaches to governance that focus on some specific issues still relevant to
governance. These approaches include;
1. Welfarist approach: stresses on the importance of providing individuals and groups

with the goods and services they need in order to strengthen their participation and
capability. Provision of land, inputs of production, infrastructures like health, education
and physical amenities.
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2. The human development approach: focuses on empowering groups and individuals to

strengthen their willingness and ability to participate. Human development should enable
individuals to enlarge their human capabilities to the full to be used in all fields;
economic, political, social and cultural.
3. Environmental approach: emphasizes on the fact that, addressing the economic

problem of the current generation should not entirely degrade and compromise the
capacity of the future generation for further advancement. Therefore, attaining human
development through economic growth and development, generation of productive
employment, production of goods and services and others for the present generation
should also take the future generation into consideration... This requires efficient
environmental governance through well-established institutions and systems of
protection.
4. Institutional approach: is concerned with the role of actors and institutional

frameworks that determines the formal and informal incentives for inclusion. This
implies that governance is a multi-actor process where the state, civil society and the
private sector interact to each other.
5. Right based approach: emphasizes on the right to development and provides the
framework for poverty reduction based on the full complement of civil, societal, cultural
and political rights. This includes provision of system of rules and laws to guarantee
rights and freedoms of citizens.
1.2 Institutions and Institutional reforms: Definitions and

Concepts
Section One: Institutions Defined
1.2.1 Institutions
what do we mean by institution?

A glance at the literature on institutions and institutional reform reveals the existence of a variety of
definitions given by individual scholars who introduced their own ways of specifying what
institutions are. The most commonly used definitions of institutions refer to:
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 rules of the game in economics (North, 1990);

 shared concepts in political science (Ostrom, 1999);
 Social structures in sociology (Scott, 2001).
They are divergent and focus on different aspects of institutions. As mentioned above, economist-
historian Douglas North is one of the most influential scholars in institutional studies across the
social sciences. He defined institutions as rules, as opposed to more commonly used definition that
combined both rules and organizations. Elinor Ostrom is another influential scholar in institutional
analysis. Ostrom defined institution: as shared concepts used by humans in repetitive situations
organized by rules, norms, and strategies. In this definition rules mean ―shared prescriptions
(must, must not, or may) that are mutually understood and predictably enforced in particular
situations by agents responsible for monitoring conduct and for imposing sanctions. Norms mean
―shared prescriptions that tend to be enforced by participants themselves through internally
imposed costs and inducements. Strategies are ―regularized plans that individuals make within
the structure of incentives produced by rules, norms, and expectations of the likely behavior of
others in a situation affected by relevant physical and material conditions.
To date, the prominent sociologist Richard Scott‗s work (2007) embodies the most comprehensive
summary and synthesis of the institutional analysis scholarship generated by divergent schools and
disciplines over time. His synthesis led Scott to propose the following all-encompassing definition
of institutions:
 Institutions are social structures that have attained a high degree of flexibility.
 Institutions are composed of cultural-cognitive, normative, and regulative elements that,
together with associated activities and resources, provide stability and meaning to social
life.
 Institutions are transmitted by various types of carriers, including symbolic systems,
relational systems, routines, and artifacts.
 Institutions operate at multiple levels of jurisdiction, from the world system to localized
interpersonal relationships.
 Institutions by definition connote stability but are subject to change processes, both
incremental and discontinuous.
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1.2.2 Approaches to the Definition of Institutions

At least three types of definitions of institutions have been used in practice and academia. While
institutions are generally understood as the phenomena that structure social interactions, each type
of definition emphasizes different elements of institutions. One definition emphasizes rules/norms,
another primarily emphasizes organizations‘ role in structuring human behavior. The most
commonly used definition encompasses both rules/norms and entities/organizations.
1.2.3 Institutions as Rules/Norms

The rule-centered definition focused on formally and informally enforced rules. It was advanced by
some early institutionalists in sociology, and has been revived since the early 1990s. For example,
Parsons referred to institutions as a system of norms ―that regulate the relations of individuals to
each other. A similar definition focused on rules reappeared in North‗s (1990) work:
Institutions are the rules of the game of a society, or, more formally, are the humanly devised
constraints that structure human interactions. They are composed of formal rules (statute law,
common law, regulation), informal constraints (conventions, norms of behavior and self-
imposed codes of conduct), and the enforcement characteristics of both. Organizations are the
players: groups of individuals bound by a common purpose to achieve objectives. They include
political bodies (political parties, the senate, a city council, a regulatory agency); economic
bodies (firms, trade unions, family farms, cooperatives); social bodies (churches, clubs,
athletic associations); and educational bodies (schools, colleges, vocational training centers).
He defined institutions as formal and informal rules of the game in a society, or more formally, are
the humanly devised constraints that structure human interaction. Organizations refer to a group of
individuals bound by a common purpose. In this work North used a metaphor of a game to
distinguish institutions from organizations, by referring to the distinction between rules and players.
This definition of institutions has been widely used in academia, especially among economists
united under the New Institutional Economics (NIE) movement and political scientists in the
rational choice tradition, as well as among some donors.
1.2.4 Institutions as Organizations

The organization-centered definition emphasizes the functional fields and human collectivities
within which rules structure human interaction and which enforce those rules. This version was
advanced in sociology, as exemplified in the works of Spencer and Sumner. For example, Sumner
defined institutions as a concept (an idea, notion, doctrine, interest) which defines the purposes or
functions of structure (a framework) which provides instrumentalities (a means) through which the
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concept is translated into action. The structure here embodies the idea of institution. This definition
mostly refers to organizational fields, systems, or subsystems, is commonly used in sociology. In
institutional analysis of organizations literature Selznick‗s influence has been significant. Selznick
distinguished between organization as a mechanistic instrument (a means to an end) and
organization as an adaptive organic system (a value). The former becomes institutionalized when
its goals or procedures become infused with values of the members of the organization, thereby
acquiring a distinctive identity.
In contrast to NIE/rational choice schools which see organizations merely as instruments designed
to pursue a common purpose, sociological institutional analysis of organizations hold that
organizations are organic systems that structure behavior through normative processes. Even if
initially created as mechanistic instruments for certain ends, over time through adaptation under the
influence of characteristics of its members and its environment, organizations become institutions
to the extent that they serve as a source of norms and rules that structure behavior.
1.2.5 Institutions as Rules/Norms and Organizations

Early institutionalists introduced the broad definition of institutions. It encompasses both
rules/norms and organizations through which those rules are enforced. Among economists, for
example, Commons saw institutions as solutions, mechanisms and rules of conduct generated to
reconcile past conflicts. Specifically, institutions for Commons consisted of a set of rights and
duties, an authority for enforcing them, and some degree of adherence to collective norms in
prudent and collective manner.
In sociology, Hughes also identified that the essential elements of institutions as including:
 A set of mores (custom) or formal rules, or both, which can be fulfilled only by
 People acting collectively, in established complementary capacities or offices (organization).
The first element represents rules and the second organization. Woodrow Wilson, a father of
American public administration, also leaned towards a similar definition emphasizing both legal
frameworks and political-administrative arrangements. To sum up, early institutionalists‘ more
encompassing definition of institutions that included both rules/norms and organizations had been
split into two directions in new institutionalism schools. While both understand institutions to be
social phenomena that structure human interaction, the new institutionalism in economics and
political science tends to focus more on rules and norms which are used by actors (individuals and
organizations) to pursue their objectives, whereas sociological institutionalism focuses more on
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organizations seen as the contexts that structure behavior of actors. A more encompassing
definition that includes both rules/norms and organizations is commonly used among practitioners
who often go back and forth between the two.
Practitioners in the past tended to use institutions to refer to government organizations and/or
their systems. Practitioners of comparative public administration and development, in what is often
called first generation reforms of the 1960‘s, tended to refer to institutions as organizations (e.g.,
political parties or specific agencies) or their systems that include organizational entities as well as
the principles of their organization (e.g., bureaucracy). In the 1960s, for example, development
administration scholars and practitioners studying institutional reforms borrowed the sociologist
Talcott Parsons‘ (1949) definition of institutions as normative patterns which define… proper,
legitimate or expected modes of action or social relationships and modified it into change-inducing
and change-protecting formal organization. The World Bank expert on public sector reforms
similarly equated institutions with organizations, and referred to institution building as ―the
process of improving an institution‗s ability to make effective use of the human and financial
resources available.
Since the early 1990s, the influence of North‗s definition on practitioners changed this picture.
Now practitioners sometimes use rule-centered, sometimes organization-centered, and sometimes a
combination of both definitions even within the same document. More recently, donors have been
moving towards a broader definition of institutions that encompasses both rules and organizations.
This lack of one definition and understanding of what specifically goes into it added to the
confusion and ambiguity, and also seems to have hindered the synthesis and application of
research, learning from experience, and the crafting of effective policies. As demonstrated in the
foregone discussions, Institutions have been defined in different ways. The sources, consequences,
and potential solutions to this definitional ambiguity are discussed above. For the purposes of this
course, institutions refer to rules and organizations that shape individuals‘ and organizations‘
behavior.
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Section Two: Understanding the Public Sector
2.1. What is the Public Sector?
The following are some of the numerous definitions given for the public sector:
1. The public sector refers to industries or services provided or funded by the government; Of
or relating to industries or services provided or funded by the government.
2. The public sector refers to that part of the economy made up of central government local
government, and public corporations.
3. That part of the economy which is owned or controlled by the public, usually through
government agencies.
4. Undertakings financed and operated by a government.
5. Means the sector that comprises organizations/institutions funded by government, local and
national.
6. Organizations run or paid for with public money.
References to the public sector are frequent in economic analysis and policy making. However, it is
not always obvious what it comprises. The concept of the public sector consists of many different
levels which have to be properly identified in order to obtain an accurate picture. The basic
classification adopted by most scholars can be summarized in the following scheme:
 Central administration +Regional and Local governments = General government
 General government+ Parastatal organizations or public enterprises =Total public sector.
According to the United Nations, ―general government‖ comprises:

 Producers of government services; all bodies, departments and establishments of any level
of government (central, state or provincial, local) which engage in administration, defense,
maintenance of public order, health, education and cultural, recreational and other social
services, furnished but usually not sold to the public.
 Non-profit-making institutions which are wholly or mainly financed and controlled by
government.
 Social security arrangements imposed, controlled or financed by the government.
 Government enterprises that are highly integrated with the public authorities; these consist
of ancillary departments and establishments mainly engaged in supplying goods and
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services to other units of government, but also include agencies that sell goods mainly to the
public but operate on a small scale.
 Public saving and lending bodies which are financially integrated with the government or
which lack the authority to acquire financial assets or incur liabilities in the capital market.
―Total public sector‖ comprises general government plus public enterprises (also called state-
owned enterprises or parastatals), which are bodies that produce goods or services and sell them to
the public, whose ownership or control rests with public authorities.
Despite the existence of a common definition of the public sector, and of each of the concepts
involved, it is not always clear how fully different countries apply the definition. Another major
problem is that some concepts appear to have different meanings in different countries, and it is not
always made clear exactly what is covered by the figures provided.
The public sector, therefore, is a part of the state that deals with either the production, delivery and
allocation of goods and services by and for the government or its citizens, whether national,
regional or local/municipal. The ―public sector‖ is broadly synonymous with ―government‖. It is
generally associated with the executive branch at national, central and local levels. Viewed this
way, the public sector is made up mainly of government departments and agencies that are staffed
by public servants. The activities of the public sector range from delivering security; administering
urban planning and organizing national defense to running industries and service establishments.
2.2. Functions of the Public Sector
what do you think is the function of the public sector?

Traditionally, the public sector is concerned with the provision of certain goods and services that all
citizens value – defense, diplomacy, law and order, property rights, parks, street lighting, public
sanitation, pest control, public health, to name a few – which the private sector, on its own, would
either under-provide or not provide at all. Economists refer to these as ―public goods.‖ A public
good can be used by one person without reducing the amount available for others to use. This is
known as shared consumption. An example of a public good that has this characteristic is a
spraying or fogging program to kill mosquitoes. The spraying reduces the number of mosquitoes
for all of the people who live in an area, not just for one person or family. The opposite occurs in
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the consumption of private goods. When one person consumes a private good, other people cannot
use the product. This is known as rival consumption. A good example of rival consumption is
bread. If someone else eats the bread, you cannot.
The second key characteristic of public goods is called the non-exclusion principle. It is not
possible to prevent people from using a public good, regardless of whether they have paid for it.
For example, a visitor to a town who does not pay taxes in that community will still benefit from
the town‘s mosquito-spraying program. With private goods, like bread, when you pay for the bread,
you get to eat it or decide who does. Someone who does not pay does not get the bread.
Because many people can benefit from the same public goods and share in their consumption, and
because those who do not pay for these goods still get to use them, it is usually impossible to
produce these goods in private markets. Or at least it is impossible to produce enough in private
markets to reach the efficient level of output. That happens because some people will try to
consume the goods without paying for them, and get a free ride from those who do pay. As a result,
the government must usually take over the decision about how much of these products to produce.
In some cases, the government actually produces the good; in other cases, it pays private firms to
make these products. The classic example of a public good is national defense. It is not a rival
consumption product, since protecting one person from an invading army or missile attack does not
reduce the amount of protection provided to others in the country. The non-exclusion principle also
applies to national defense. It is not possible to protect only the people who pay for national
defense while letting bombs or bullets hit those who do not pay. Instead, the government imposes
broad-based taxes to pay for national defense and other public good.
Beyond government‘s undisputed role as a provider of public goods, there are controversial
questions about the economic and social role of the public sector. Opinions are (and always will be)
divided on how active and influential the public sector should be in a country‘s economic and
social life. How much industrial output should be produced by the public sector? How should the
government regulate the private sector? How should it address economic inequality? How should it
pursue a range of issues related to social justice, environmental protection, etc.? The way countries
deal with these questions determines the nature, role, extent and structure of the public sector.
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Hence, apart from the provision of public goods, consensus is lacking as to the proper role of the
public sector. This makes it difficult to come up with an exhaustive list of activities to be carried
out by the public sector. However, in both developing and developed countries, the public sector
designs and implements policies and programs that aims to fulfill the government‘s broad
economic and social objectives. This includes among other things,
2.2.1. Makes Economic and Social Policies

The public sector makes and enforces policies that cover virtually everything the government does.
Policies developed by the public sector serve the government of the day, reflecting its social and
economic goals.
2.2.2. Designs and Implements Public Programs

Policies are realized through the design and delivery of public programs involving delivery of
public services, production of goods, or transfers of resources to individuals, organizations or other
levels of government. Governments also use regulation – in areas such as workplace standards,
consumer protection, the environment, foreign investment, transportation safety – as a tool for
achieving policy goals.
2.2.3. Raises Revenue

Government must raise money in order to implement its programs. The public sector collects taxes
and user fees that are levied on citizens and companies. Governments also use tax policy as a
means to pursue social and economic goals. E.g., governments may pursue social goals by
providing tax breaks to certain segments of the population. They may also use tax provisions to
encourage certain forms of investment or industrial development.
2.2.4. Manages Accountability

Citizens demand accountability in return for the powers granted to government to raise and spend
revenue. The public sector responds by enforcing internal accountability measures, and by
reporting to citizens on how money is spent and, on the successes, (and failures) of public
programs. Governments typically create and sustain independent public institutions of
accountability that are empowered to oversee the government‘s actions and demand explanations.
This may include auditor‘s general, public ombudsmen, the judiciary, the legislature, human rights
commissions, etc.
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2.3. Public Sector Structure
In parliamentary systems, the entire public sector reports ultimately to the head of state, although
its day-to-day operation is normally the responsibility of the head of government. In presidential
systems, the heads of state and government are combined in one office (e.g., the President of the
United States). In other countries, the two positions are distinct, with the head of state limited to a
ceremonial role (e.g., in Canada where the Prime Minister is head of government and the Governor
General is the ceremonial head of state). In still other countries– France and its former colonies, for
example – both the head of state (President) and head of government (Prime Minister) play
substantive political and policy roles.
The head of government governs with the advice of his cabinet, which is made up, for the most
part, of the political heads (often referred to as ―Ministers‖ or ―Secretaries‖) of government
departments (see below). Cabinet has both political and a policy/managerial function. Cabinet is the
country‘s most powerful political institution – a forum where the country‘s top political leaders
solve, away from public scrutiny, matters related to advancing the government‘s political agenda,
managing political opposition, etc. It also serves a more technical, policy/managerial function
because cabinet ministers are also the heads of government departments. Cabinet is therefore a
forum for addressing major policy issues that arise in particular government portfolios.
The public sector is divided into organizational units, each with a particular functional
specialization and related set of responsibilities and authorities. Broadly, there are two major types
of organizational units: central agencies and line departments. There are also various types of
specialized agencies, and state-owned enterprises. Line departments are specialized around
programs and policies that relate to a particular economic or social sector, e.g., Department of
Industry, Department of Health, etc. Each department is headed by a high-ranking political officer
– a ―Minister‖ or a ―Secretary‖. Central agencies are specialized around functions that affect the
entire government. For example, a budget office manages the annual budget-making process; a
cabinet office manages the flow of policy and program proposals from all departments into the
cabinet for decision; the Department of Finance sets budget allocation levels that affect resources
available for departments; a planning agency (common in developing countries) develops proposals
on major investment initiatives that might be implemented by line departments.
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Recently there has been an increasing tendency for governments to take certain well-defined
functions out of line departments and place them in specialized agencies. Customs and revenue
agencies are a good example of this trend in the developing world. Specialized agencies often have
greater flexibility to manage their human and financial resources than do line departments. In
return, they are normally subject to tighter performance standards. Specialized agencies may report
to the departmental bureaucracy or directly to the Minister. The organization of the public sector
(public ownership) takes several forms, including:
 Direct administration funded through taxation; the delivering organization generally has no
specific requirement to meet commercial success criteria, and production decisions are
determined by government.
 Publicly owned corporations (in some contexts, especially manufacturing, "state-owned
enterprises"); which differ from direct administration in that they have greater commercial
freedoms and are expected to operate according to commercial criteria, and production
decisions are not generally taken by government (although goals may be set for them by
government).
 Partial outsourcing (of the scale many businesses do, e.g., for IT services), is considered a
public sector model.
A borderline form is:
 Complete outsourcing or contracting out, with a privately owned corporation delivering the
entire service on behalf of government. This may be considered a mixture of private sector
operations with public ownership of assets, although in some forms the private sector's
control and/or risk is so great that the service may no longer be considered part of the public
sector.
Section Three: Institutions and Public Sector Reform
3.1. Background
As we have mentioned earlier, the field of development theory and practice, at least in the post-war
years, has been peculiarly susceptible to all manner of fads and fashions with respect to both the
ends and the means of development. Various schools of thought have come in and come out of
22
favor since the official launching of the project of development in the post second world war
period. Another trend has developed momentum in the past decade or so.
An institutional perspective on development has become increasingly prominent in development

thinking, captured in the notion 'Institutions Matter' or 'Governance Matters.'
Beginning in the 1990s, based on the assumption that 'institutions matter,' there has been a massive
surge in development assistance for institutional reform projects in developing countries. The idea
that institutions matter for development is based on the assumption, developed by Douglass North
and other new institutional economists, that institutional frameworks create incentives for behavior,
leading to different outcomes. According to North, the specific institutional constraints dictate the
margins at which organizations operate and hence make intelligible the interplay between the rules
of the game and the behavior of the actors. If organizations – firms, trade unions, farm groups,
political parties, and congressional committees to name a few – devote their efforts to unproductive
activity, the institutional constraints have provided the incentive structure for such activity. Third
World countries are poor because the institutional constraints define a set of advantages to
political/economic activity that does not encourage productive activity.
However, donors‘ ―Institutions Matter‖ Policy that emphasizes public sector reforms is not new.
The Institutions matter policy, which stresses the need to reform government institutions to build
and strengthen their capacity, reemerged as a new idea in donor circles in the second half of 1990s.
Donors have been explicitly or implicitly promoting such institutional reforms in developing
countries, with the focus on strengthening public sector institutions, at least since the emergence of
official development assistance at the end of the WWII. In this regard three waves of institutional
reforms, which will be discussed in greater detail in the next chapter, could be identified.
Institution building was the main focus of the reforms promoted in developing countries by donors
during the first wave of official development assistance led at that time by the United States. The
1949 ―Point Four Program of U.S. President Harry Truman called for mobilization of Western
expertise to build and modernize the governments of newly independent postcolonial countries,
launching the major wave of institution building (IB) reforms. Institutional reform during this time
was largely confined to the organizational level changes concerned with improving the managerial
capacity of the administrative system and specific organizations.
23
But the attempts by experts to help developing countries build government institutions by modeling
them after those of the West did not deliver the expected results. Disillusioned with such outcomes,
donors pushed institutional development to the backseat until the mid-1990s to reemerge with new
rigor.
Institutional development remained an important component of donors‘ projects and programs

between the end of the 1960s and the mid-1990s even when donors moved away from explicit
reliance on institution building and switched their attention to other kinds of inputs to promote
development. The transfer of technologies, provision of services, policy advice, or building of
infrastructure projects all have been complemented with technical assistance components intended
to improve or build the institutional capacities of the recipient governments to manage and operate
those inputs.
Even in the 1980s and early 1990s – referred to as the second wave of donor-promoted reforms –
when the most influential donors, the International Monetary Fund (IMF) and the World Bank
urged recipient countries to downsize their public administration systems, to free markets from
government control and make the latter perform like businesses, institutional reform was a crucial
part of these interventions. While this wave of reforms was concerned with downsizing public
sector institutions, downsizing was not simple elimination, but a complex process that required
transformation of systems of bureaucratic institutions. Ultimately, this aspect of reform was
overshadowed by other elements of donor policies.
In the late 1990s, institutional reform regained attention in development circles. The current
consensus among donors is that ―high quality institutions enable a better economic and investment
climate, foster better governance and accountability, encourage trust, reinforce property rights, and
avoid the exclusion of sections of the population. The experiences with failed structural adjustment
reforms in many developing and transitioning countries from the 1980s to the 1990s, combined
with the new developments in research, among other factors, made it clear to donors the important
role that strong and effective public sector institutions play in development. Donors realized that
externally supplied policy advice and other inputs would not benefit recipient countries without
improved governance institutions.
24
In this third wave, donor institutional reform has become even more complex and has a much
broader orientation compared to previous waves. Donors started advocating transformation of
entire governance systems of recipient countries as they came to realize that institutions are
interdependent and that reforms need to account for this reality. This means that economic,
political, and societal institutions should be changed along with public administration systems for
the reforms to have sustained effect.
Thus, the current wave of institutional reform, sometimes referred to as ―governance reform –
encompasses a wide range of economic and political (democracy-promotion) reforms intended to
ensure that governments, in partnership with NGOs and the private sector, work towards good
governance, economic growth, and poverty reduction.
In practice, however, most donors are cautious of intervening in the political aspects of reforms and
believe that economic development hinges on the quality of the regulatory environment. This puts
even more emphasis on reforming administrative institutions.
3.2. Institutions and Public Sector Reform: Meaning and Purpose
In the preceding section we have discussed that, while the scope of donors‘ development-promotion
efforts has drastically expanded over time, reform of administrative/public sector institutions has
constituted the most important pillar of donor-promoted development efforts in all three waves. But
for the last decade institutional reform has reemerged with a more ambitious twist. As the content
of administrative reform has expanded, so has the emphasis on links between public administration,
its political context, and society. Administrative reform is no longer about transforming the
administrative state alone, but transforming governance and the relationships between societal
institutions that exercise authority within a single country/state, a group of states, or a country
association.
A brief overview of the donor promoted institutional reform indicates that there is a fair amount of
overlap between the terms public administration reform/administrative reform, institutional reform,
public sector reform, governance reform, and capacity building. The overview also shows that these
terms are also used liberally by different stakeholders to refer to a wide range of phenomena.
Hence, the terms, administrative reform, public sector reform, institutional reform, capacity
development/building and governance reform are often used interchangeably. At this juncture you
might ask the question that, do all these terms mean the same thing. How do we deal with the
overlaps and ambiguities in the uses of these terms?
25
3.2.1. Public Administration Reform

The concept of administrative reform does not lend itself to a clear-cut definition. However, the
definition, which is commonly used because of its comprehensiveness and scope, is the one offered
by Gerald Caiden (1969). According to Caiden (1960:65) administrative reform is the ―artificial
inducement of administrative need to improve on the status, artificial transformation (departure
from existing arrangements and natural change processes), and administrative resistance
(opposition is assumed). Administrative reform is political rather than merely organizational. It is
―a political process designed to adjust the relationship between a bureaucracy and other elements in
society or within the bureaucracy itself‖.
Administrative reform has a ―moral content‖ in that it seeks to create a ―better‖ system by
removing faults and imperfections. It is usually undertaken to change the status quo for the better. It
aims at making the administrative and political structures and procedures compatible with broader
goals. Administrative reform sets additional political values to be used as yardsticks against which
administrative performance may be judged. The crux of administrative reform, therefore, is
innovation and wealth creation that is, injection of new ideas and new people in a new combination
of tasks and relationships into the policy and administrative process. Administrative reform may
occur where two conditions are met.
 A set value with which the existing bureaucratic arrangements, public personnel and values
are seen to be in conflict.
 The concern by politicians and the general public that the existing bureaucratic structures
cannot realize new goals set for them.
Administrative reform, is used interchangeably with public administration reform, has been more
broadly defined as ―the induced systematic improvement of public sector operational
performance. This definition of administrative reform was further modified and expanded by Quah
to include attitudinal aspect, on top of structural one, as: a deliberate attempt to change both (1) the
structure and procedures of the public bureaucracy (i.e., reorganization of the institutional aspect)
and (b) the attitudes and behavior of the public bureaucrats involved (i.e., the attitudinal aspect), in
order to promote organizational effectiveness and attain national development goals.
Public administration refers to:
26
 The aggregate machinery (policies, rules, procedures, systems, organizational structures,

personnel, etc.) funded by the state budget and in charge of the management and direction
of the affairs of the executive government, and its interaction with other stakeholders in the
state, society and external environment.
 The management and implementation of the whole set of government activities dealing with
the implementation of laws, regulations and decisions of the government and the
management related to the provision of public services.
Public Administration Reform can be very comprehensive and include process changes in areas
such as organizational structures, decentralization, personnel management, public finance, results-
based management, regulatory reforms etc. It can also refer to targeted reforms such as the revision
of the civil service statute.
Public administration reform has been traditionally viewed by many donors more as a set of
technical interventions to improve internal efficiency of government organizations, and its political
context and dimensions have been downplayed. But this term is perceived to be somewhat narrow
given that the performance of public administration system is not only a function of how civil
service operates; it is also shaped by economic, social, political, and cultural factors. Indeed, public
administration reforms include not only transformations in civil service, but also reforms of the
policy process, decentralization, and privatization, and reform of citizens ‗relationship with
government through greater mobilization of civil society, all of which alter the power dynamics in
the society. In this last sense, public administration reform could be largely synonymous with
institutional reform.
3.2.2. Public Sector Reform

In the 1980‘s, Public Administration reform is gradually being replaced by public sector reform
(PSR) and in the 1990s also by governance reform. While there have been different views and
definitions of PSR, many people and researchers see it as the attempt by governments to change
ways of doing things. That is why Schacter (2000) defines PSR as the ‗strengthening the way the
public sector is managed‘. The presupposition is that things are not properly managed in the public
sector. So, changes from the old way of doing things must take place.
27
To this end, there has emerged a deliberate policy as well as action to change organizational
structures, processes and people‘s behavior in an attempt to improve government administrative
machinery for performance at optimal level. The overall goal is excellence in performance in public
sector management. Since reform means an improvement in something, a change for the better as a
way of correcting wrongdoing or defects in a system; and as the public sector ‗can be understood to
be the key apparatus for the execution of the functions of the state or government‘, then PSR is the
total overhauling of government administrative machinery with the aim of injecting real
effectiveness, efficiency, hard-core competence and financial prudence into the running of the
public sector. This rebranding of the public sector is targeted to meet the demands of a rapidly
improving and changing global socio-political environment.
A better understanding of PSR, however, can be achieved if one captures the context under which
PSR came to be seen as panacea for the crises of development in the third world from 1980s
onwards. Specially, mention has to be made to the role played by international financial institutions
like the IMF and the WB.
PSR was initiated against the background that governments required a departure from the
traditional methods of administration and the urgent need for a renewed public sector to propel
government in its quest for sustainable socio-economic, political and technological development.
So, there was a need for structural re-engineering of the public sector with the infusion of new
values of professionalism, accountability, responsiveness and a focused sense of mission for
maximum efficiency in the economy.
Based on the above, the main objectives of PSR as far as the IDAs are concerned, are as follows:
i. To achieve better delivery of the basic public services that affect living standards of the
poor (World Bank 2000: chapter 6).
ii. To create a climate conducive to private sector development (World Bank 1997:103).
iii.To make the state or government institutional apparatus market friendly, lean, managerial,
decentralized and ―customer‖ friendly, in the hope that it would better meet its societal
objectives of good governance as well (Mhone 2003:10).
From the above, we see that PSR aims at institutional restructuring of the public sector, with the
application of principles obtainable in the private sector as a basis for enhancing the efficiency and
28
effectiveness of public sector institutions. Arising from this notion of how the public sector should
be run and managed is that government is now being seen as a profit-making institution to be
driven by market forces. In essence, PSR is carried out with the mindset of seeing government as a
profit-making enterprise rather than in service to the people. In fact, that is why we see African
leaders talking about a bloated civil service, which needs to be downsized, and the uncontrollable
craze to privatize and commercialize all government enterprises. It must be pointed out here that,
PSR is broader than PAR in that it includes not only the reform of the machinery of Government
(public administration), but also public enterprises.
3.2.3. Institutional Reform

Institutional reform, which is much broader than PAR and PSR, refers to the artificially or
deliberately induced changes in rules and organizations. From this standpoint the purpose of
institutional reforms, which are sometimes called governance reforms, is to establish the way of
governing that follows good governance principles. Developing countries are advised to reform
their institutions to exercise good governance aligned with the principles of good governance and,
as a result, secure economic, political, and social development. As mentioned above, in this wave
of institutional reforms, good governance is treated both as the means and ends of development.
How can we deal with the overlaps and ambiguities in the uses of these terms?
The overview provided above indicates that there is a fair amount of overlap between the terms-
public administration reform/administrative reform, public sector reform, institutional reform,
governance reform, and capacity building. The overview also shows that these terms are also used
liberally by different stakeholders to refer to a wide range of phenomena. Still, different donors
prefer using different terms. The United Nations uses public administration reform in to refer to
reforms of the aggregate machinery (policies, rules, procedures, systems, organizational structures,
personnel, etc.) funded by the state budget and in charge of the management and direction of the
affairs of the executive government, and its interaction with other stakeholders in the state, society
and external environment. OECD prefers to focus on capacity development. The World Bank uses
public sector reform and governance reform to refer to reforms involving the transformation of all
institutions of governance. For the World Bank, the focus of contemporary institutional reform is
not a single institution, but the whole governance system.
29
Public administration reform is seen as central to, and the entry point for, transforming the whole
governance system. Public administrative reform is seen as the pillar of the current development
agenda and to the evolving and all-encompassing governance reform. Donors and academics share
an understanding that prospects of growth are slim without public goods provided by government,
such as infrastructure, basic educational institutions, and law and order. The government is
expected to secure and maintain a favorable policy and institutional environment for other players
and institutions in a society in order to generate social welfare. In other words, a tacit assumption
underlying current public administration reforms is that the latter would generate a spillover effect
on the broader governance environment
In donor literature institutions and institutional reforms mostly refer to public sector institutions and
reforms of public sector institutions, even though the term institutions by definition are not
confined public sector alone. The opposite is also true: Although administrative or public sector
reform is a phenomenon that can be viewed from different angles (for example, as an
organizational development) it is also an instance of deliberate institutional change or institutional
reform in that public sector reform involves deliberate attempts to change rules, organizations‘
structuring behavior and the relationships between individuals and organizations in public sector.
Whatever the name donors and researchers use, the focus of institutions and public sector reform is
on deliberate changes introduced to public sector institutions, specifically focusing on rules and
organizations of public administration. Even though the term institutions by definition are not
confined public sector alone from now on we use the terms institutional reforms and public sector
reforms to refer to these changes.
Public sector reform, with focus on transformation of public administration, is one means of
capacity building through focusing on structural dimensions of governance process and system.
Hereafter, institutional reforms will primarily refer to the reform of public administration
institutions unless otherwise indicated.
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CHAPTER TWO
WAVES OF INSTITUTIONAL REFORMS

Section One:
3.1 The First Wave (1950s-1960s): Development through the Modernization of
Administrative Institutions
3.1.1 Policy Context

During this wave of reforms, the United States emerged as the leading nation shaping development
reforms in the developing world. The United States Agency for International Development
(USAID) and the Ford Foundation were the key donors funding and designing development
assistance programs abroad in this period. The design and approach to the reforms promoted in
developing countries through development assistance projects in this decade closely followed the
popular ideas about development and governance in the United States, thus shaping international
development policy at that time.
In this era, development was associated with improved social and economic conditions in the
―underdeveloped areas‖ through modernization of governmental institutions. The influence of an
increased government role in mitigating the effects of the Great Depression in the United States in
the 1930s, in managing the war economy of the 1940s, and helping to produce a recovering
economy in the European states through the Marshall Plan in the 1950s shaped the idea of how
development should be achieved in the developing world. The idea that desirable results could be
obtained through the creation and building of large, modern and strong government institutions was
highly persuasive. The economic thought of that time also favored consolidated government effort:
big push theory, balanced growth, take-off into sustained growth, and critical minimum effort thesis
all saw economies of scale in basic industries and industrialization as the engine of economic
growth.
3.1.2 Influential Schools of Thought

The content of reforms was shaped under the combined influence of rationality, modernization, and
scientific management paradigms. The 1950s was a time of faith – faith in the developmental power
of administrative tools devised in the West. This wave of reforms, characterized with a great deal of
optimism in the power of public administration to transform so-called ―backward societies‖. The
31
best and quickest way to bring the dream of development into reality was through the mechanism
of public administration. The net result of all this enthusiastic action was that in the 1950s public
administration was a magic term and public administration experts were magicians, of a sort.
The view that humans can determine and build their future using reason and rationally designed
mechanisms, technologies and institutions, instead of relying on fate was the underlying
assumption of the reforms in the developing countries informed by modernization perspective.
Modernization theory in turn drew heavily from scientific management theories that saw
organizations as closed systems (the view that organizations are not affected by their socio-political
environment) and emphasized efficiency and control in bureaucratic organizations.
The scholarship modernization perspective also tended to juxtapose rationally designed modern
institutions against traditional social institutions, favor the former over the latter. Furthermore,
recipients‘ culture was seen as sources of bureaucratic dysfunctions and an impediment to smooth
functioning of Western tools and dominant Weberian models of bureaucracy which development
administration was to overcome. Imported Western institutions, they predicted, would replace
traditional institutions in developing countries despite any opposition from pre-existing institutions
that soon would be sidelined.
Modernization‘s two key features are particularly evident in development reforms at this stage. One
of them is the belief in the universality and inevitability of the spread of Western values and
practices such as instrumental rationality, secularism, individualism, and science-based
enlightenment in all the areas and people of the earth. Another is its elitist bias, an assumption that
the agents of modernization would be an enlightened minority endowed with Western education
and committed to transforming their societies along Western lines for benefit of all through the
state bureaucracy.
Scientific management embodied the ideas of both modernization and elitism. Its main tenet that
one best way could be identified for any job was highly influential in American public
administration at that time and directly shaped the approach to institutional development. The
implicit assumption [underlying development administration] was that there was one form of
development as expressed in developed countries that ―underdeveloped societies‖ needed to
replicate. It was assumed that designing administrative institutions in developing countries was
32
possible and desirable through the power of knowledge and technical assistance. ―Poor and
disadvantaged nations‖ would develop by adopting rational practices and importing modern
institutions, organizations, technologies and values of advanced societies that were deemed
desirable and superior to their local equivalents.
3.1.1 Inter-University Research Program in Institution Building

To address the question of institutional change in developing countries, the Inter-University
Research Program in Institution Building was set up by public administration scholars from the
American universities of Pittsburgh, Michigan State, Indiana, and Syracuse. They hoped to provide
solid research knowledge about the process of institutional change. Members of this group had
served as consultants or researchers on overseas development projects and shared the concern about
development specialists‘ lack of knowledge on the process of institutional development assistance
and a desire to remedy this problem.
This group borrowed the sociologist Parsons‘ definition of institutions as generalized patterns of
norms which define categories of prescribed, permitted, and prohibited behavior in social
relationships. This group then modified this abstracted norm-based definition into an organization-
based one by redefining institution as change-inducing and change-protecting formal organization.
This shift can be explained by the group‘s desire to make the definition of institutions applicable
for practitioners by focusing on the more tangible framework (organization) within which those
norms were to grow and take root.
Institution building was seen by this group as an induced social innovation by change-oriented
elites through formal organizations so that these organizations could take root, gain acceptance, and
become normative in new environments; i.e., become institutionalized. The goals and the end state
of institution building were to create a ripple effect in changing that environment. Institution
building consisted of planning, structuring, and guidance of new or reconstituted organizations
which (a) embody changes in values, functions, physical, and/or social technologies, (b) establish,
foster, and protect new normative relationships and action patterns, and (c) obtain support and
complementarity in the environment.
The key elements of this institution building model were categorized under institutional variables
and linkages.
33
 Institutional variables included: leadership; doctrine (specification of values, objectives,

operational methods underlying social action); program (actions… related to the
performance of functions and services constituting the output of the institution); resources;
internal structure, and ―processes established for the operation of the institution and for its
maintenance.
 In addition, the following four types of linkages have been distinguished:
 enabling (with organizations and social groups which control the allocation of authority
and resources),
 functional (with those organizations performing functions and services which are
complementary),
 normative (with organizations that incorporate norms and values… relevant to the
doctrine and program of the institutions), and
 Diffused (with elements in the society which cannot clearly be identified by
membership in formal organization).
The group engaged in studying the linkages between these elements and in drawing generalizations
about the institution building process. Some practitioners and researchers found this model of
institution building useful and relevant as it brought together important, although not new,
elements. But this model was not extensively used. In part, the model was abandoned as the interest
in and funding for institution building dwindled after less than a decade. The model was also
criticized as being a-priori (vs. drawn from observations), un-testable (i.e., did not qualify as a
theory), static (did not tell how the various elements were interrelated), and prescriptive, based on
wishful thinking rather than testable assumptions and observations. Practitioners also noted that it
was too abstract and failed to stress important factors in order to be useful.
3.1.2 Critic and Reaction to the Inter-University Model of Institutions: Comparative

Administration Group (CAG)
The group of scholars that challenged the Inter-University Research Program in Institution
Building approach emerged under Fred Riggs‘ leadership. Riggs summarized his view as follows:
There were two basic patterns for public administration, the first had evolved in traditional
empires and kingdoms where pre-industrial social and economic conditions prevailed, and
the second was a product of modernity following the industrial revolution and the emergence
of the post-Westphalian state system. I rejected the escalator model of the new modernization
34
literature in which traditional societies were expected to respond to the fresh breezes of
modernity by embracing changes that would, sooner or later, bring them into the new world
of opportunity. It struck me that most societies would adhere tenaciously to many of their
most valued ancient traditions and cultural norms while simultaneously importing and
accepting a façade of practices and patterns that would, hopefully, enable them to maintain
their distinctive cultures while benefitting from the autonomy and material goods offered by
the outside world. Instead, curious amalgams would be formed in which ―agrarian‖ and
―industrial‖ would combine in unstable mixtures. In the prism of my imagination, the white
light of undifferentiated social systems would mingle with the rainbow hues of highly
differentiated social structures as found today in every industrialized society.
The CAG scholars‘ intent, in contrast to the orthodox American public administration, was to study
bureaucracy and public administrative systems across countries based on their unique underlying
sociopolitical and cultural trends and conditions. This process was intended to address the research
questions posed by development administration. Riggs‘ call for a clear understanding of the forces
which lead to administrative transformations was in line with this agenda. The CAG scholars, many
of whom had been engaged in development assistance and institution building also intended to
correct what Riggs called the fundamental intellectual flaws of traditional development
administration – ethnocentrism and ignorance. In other words, they wanted to overcome the
―erroneous assumption of superiority of Western techniques and structures to their indigenous
counterparts and a lack of awareness or ignorance of the unique contextual - cultural and historical
– factors that shaped the success of Western management techniques.
Unfortunately, the CAG did not get to fulfill its ambitions. The interest in their subject matter
significantly faded over time due to a number of constraints. Insiders mention among the main
obstacles the competing agendas of the development administration and comparative administration
and the different expectations of the funders. The Ford Foundation that provided funding for this
group was interested in a prescriptive development administrative (how to) approach, whereas the
CAG was more interested in scientific inquiry and synthesis of their observations based on in-depth
empirical evidence. Still, the CAG approach left an important trace by paving the way for the
emergence of a new discipline comparative public administration.
35
3.1.3 Content of and Approach to the Reforms
3.1.4 Administrative Reform (Development Administration)

The reforms in developing countries promoted by donors primarily by USAID and the Ford
Foundation in the United States focused on building and strengthening the administrative capacities
of governments, especially public administration systems in a number of newly independent post-
colonial states in Africa, the Middle East, and South East Asia. Scholars traced the dawn of this
movement, known as development administration, to 1955. Institutional development, especially in
public administration, was viewed as the primary means of promoting this vision of development.
To a large extent, and as an outcome of developmental pressures, administrative reform was forced
to the top of the agenda for action in many countries.
The donors‘ technical assistance programs attempted to build and/or change organizations and laws
in the receiving countries by replicating Western institutions in these developing countries. It was
generally presumed that the laws, policies, structures, and procedures in developed Western
countries were superior to those indigenous and developing countries because of their greater
rationality, efficiency, and relationship to democratic ideals. Their diffusion and adoption were
considered both necessary (given the ―evolutionary superiority of reforms introduced by Western
consultants) and purposive, in that Western lenders often mandated administrative reforms as a
condition for continued loans.
This transfer of organizational structural arrangements, human resources management, budgeting,

and other Western models and technologies to developing countries was done without concurrent
changes in political, economic and social institutions. In part, the donors and their consultants
assumed that bureaucracies in developing countries were as autonomous as was perceived in the
United States. They believed that the spillover from the changes in specific bureaucratic
organizations would gradually trigger the transformation of the whole system. Reformers justified
their technical focus and neglect of the political environment of administrative institutions by the
fact that the donors wished to abide by self-imposed concerns of political neutrality.
Furthermore, they tried to apply the generic scientific management approach to administrative
reform such as POSDCORB (Planning, Organizing, Staffing, Directing, Coordinating, Reporting
and Budgeting). These models were what the consultants themselves knew well and they lacked
knowledge of the institutions and of the environments they were sent to transform. The limitations
36
of the scientific management approach to public administration, such as the assumption of an

organization as a closed rational system and the neglect of its environment as well as the informal
and emotional behaviors which influenced organizations, were exposed with greater intensity
abroad.
The approach to the reforms was characterized by the following: First, the reforms were
fragmented. It was believed that by transforming individual organizations/agencies at the central
level, reformers would be able to affect the broader institutional environment. This proved not to be
the case. Furthermore, the design and implementation of the reforms overlooked not only local
government institutions, but also the broader context of these organizations (or their ecology, in
Riggs‘ language).
Second, the reforms were determined externally, with little input from the beneficiaries. In other
words, the reforms were supply-driven and used the same models borrowed from the West with the
assumption that those models were universal and would fit all.
Third, the reforms were carried out without a clear understanding of what institutions are (overall
and in specific contexts) and how to change them. Many oversees experts did not study in depth the
history and institutional context of the local societies, did not fully understand the local people, and
were not adequately prepared to provide the expected assistance. Rather, they were perceived as
ignorant and resented by locals, yet tolerated and accepted since they brought resources with them.
Fourth, reforms were crafted with the assumption that formal Western organizational models would
fit and work in any environment. But the design of the interventions did not account for the actual
realities and needs of the recipients. Fifth, the reformers were conceived as technocratic
interventions, in an attempt to present donor interventions as neutral. But reformers neglected to
understand that administrative institutions are not neutral instruments, but are embedded within a
political environment and are subject to political dynamics.
Sixth, donors tended to focus more on inputs, neglecting the actual outcomes of the reforms and
assuming, without evidence, that the reforms would generate the expected outcomes. Little thought
was given as to what kind of unintended consequences the reforms would generate.
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3.1.5 The Law and Development Reform

Along with development administration that intended to transform administrative institutions, a law
and development initiative emerged, focused on transforming legal and judicial institutions. The
law and development movement were also funded by USAID as well as by the Ford Foundation. It
engaged professors from leading law schools in the United States. The dominant assumption
underlying this initiative was that the reform of the legal and judicial systems, just as the reform of
the administrative systems for the development administration movement, would lead to social
change and modernization in developing countries.
Both movements shared a similar approach to institutional reforms based on the following
assumptions. First, institutions in developing countries could be changed by external agencies via
adopting or modifying formal laws and organizational structures. Second, modeling them after
Western institutions would work without regard to the local context, because the knowledge about
the existing institutions is lacking and/or the imported institutions are superior. The donors‘ vision
of public sector reforms promoted during this wave of reforms can be illustrated through the figure
that follows.
Figure 1: The Vision for Public Administration Reforms in the First Wave
38
3.1.6 Assessment of the Outcomes of the Reforms

Practitioners and researchers involved in institutional administrative reforms in various countries
observed that the institution building which focused on building and developing public
administration institutions rarely achieved expected outcomes. Numerous studies undertaken by
comparative public administration scholars showed that such reforms produced more failures than
successes.
Moreover, some institutional reforms generated unforeseen negative side effects, as they facilitated
the use of government resources and foreign aid by unpopular regimes and post-colonial political
leaders to promote and serve their personal and political interests. What reformers overlooked was
that: Administrative techniques when transplanted or installed can be bent to the interests of
established elites or survive as formalisms without producing new capabilities or substantive
reforms. Even when new, rationalized capabilities are produced with the help of foreign technical
assistance, they can be used to enhance regime objectives, which few observers would define as
developmental.
Those state institutions that had been getting technical assistance, instead of demonstrating the
expected improved performance, exhibited dysfunctional features such as political repression,
economic stagnation, flourishing corruption and enduring poverty. Administrative development and
development administration has become euphemisms for autocratic, frequently military, rule that,
admittedly, sometimes induced industrialization, modernization and even economic growth. But
this occurred at a great cost in the welfare of the rural and urban poor and substantial erosion if not
deletion of political freedoms associated with liberal democracy.
These changes rendered the centralized and elitist social engineering approach to development of
the 1950s increasingly irrelevant; and along with that, development administration and comparative
public administration lost their appeal. By the mid-1970s, the focus of the reforms promoted by the
United States started to shift away from government institutions. Policy makers, disillusioned with
the outcomes of the reforms, lost interest in administrative reforms. Increasing criticism of big,
inefficient, and corrupt governments and the ascendance of the neoclassical economic paradigm
also significantly influenced Western social sciences and development.
39
The reforms generated invaluable lessons for practitioners and researchers of administrative
institutions reforms. The first wave of reforms made it clear that reformers could not transform the
governments and societies of developing countries by transforming select government
organizations. Overall, this wave of reforms challenged all the assumptions that informed the
approach to reforms. The period from the 1960s to the 1970s was a time of reflection and of a
search for better ways of promoting development. It was observed that administrative reform –
artificial inducement of change against resistance in human systems – is an extremely difficult
process; it often challenges the status quo and faces resistance from bureaucrats who are expected
to implement those reforms. Administrative reform requires long timeframes and a significant
commitment of resources that many developing countries cannot always afford, and it is hard to
evaluate the results or even to grasp their significance.
A series of conferences in the United States and elsewhere that brought together practitioners and
academics to discuss what could be learned and improved in administrative reforms arrived at the
following conclusions. Three major points could be highlighted from those deliberations. First,
administrative reform has to be country specific: the universal formula for administrative reform,
based on foreign (i.e., Western) models, concepts, and ideas, is unlikely to work in developing
countries, unless it is adjusted for the local ecology.
Second, administrative reform is more than changes in management: it is concerned not only with
organizational performance per se but with improving the performance of the whole public sector.
Thus, administrative reform is a broader process that has to account for its ecology (in Riggs‘
words) – i.e., its political and social context and the dynamics among these forces, in order to
accomplish its purpose. The third point that emerged from the experiments that administrative
reform requires changing not only formal laws, organizations, and procedures, but also attitudes,
mindsets, and the cultures of those involved.
The problems in the first wave of institutional reforms also have resulted from a number of other
oversights. The elitist, managerial, top-down and technocratic approaches failed to involve local
stakeholders in the process and account for the political aspects of the reform. In addition, little
attention was paid to promoting internal capacity to keep the central governments accountable.
Development assistance was directed towards central governments, but neglected constitutionally
40
democratic processes and other stakeholders, including local governments and grassroots
organizations.
The experiences with the first wave of institutional reforms identified at least two major knowledge
gaps - one on the nature of institutional change and another on the nature of the very institutions
that reformers were trying to transform. Both practitioners and researchers learned that they did not
understand how bureaucratic institutions change and/or how they can be transformed. Development
administration experts and scholars admitted that they had tried to help developing countries to
modernize their administrative institutions without knowing what their existing institutions were
and how to change them.
Practitioners and researchers also found that they had a poor understanding of the local contexts
and of the very institutions they were trying to change. In developing countries, it was much easier
to adopt laws and formal organizational structures than to institutionalize corresponding behavior.
Formal administrative structures in these entities often served as façades, while the actual behavior
remained a latent function of other institutions and other contextual (historical, cultural, and like)
factors, which were not sufficiently understood by Western practitioners and academics.
All of these factors combined to contribute to the loss of this movement‗s momentum. The
experiences taught a sobering lesson that the experts sent to help ―underdeveloped areas‖ did not
have the knowledge and the skill to relieve the suffering of these people but the lesson was wasted.
Both practitioners and researchers chose a tactic of hiding their heads under the sand, until these
lessons came to haunt them a few decades later. Practitioners decided that focusing on more
tangible projects had better payoffs. The mainstream policy sciences chose to live with the false
assumptions about the universal applicability of Western knowledge, and marginalized those who
challenged this view.
Section Two:
3.2 The Second Wave of Reforms (1980s and Early 1990s): The Downturn of
Government Institutions and the Market as the New Driver of Development
3.2.1 Background and Policy Context of the Reform

In this period the International Monetary Fund (IMF) and the World Bank (WB) emerged as the
most influential IDA shaping this wave of public sector reforms. During this time, the reforms
41
promoted by these IDA in developing countries were dedicated to freeing markets from
government‗s regulatory grip. It was believed that unleashing the private sector creative energy
would induce growth. During this wave of reforms, development was primarily measured by the
level of economic growth driven by the private sector rather than by government, as had been
previously assumed.
This wave of public sector reforms which were curtailed as part of the broader macroeconomic
restructuring intended to cut down the size and influence of government bureaucracy on the
economy and adopt principles and practices from private sector management. The expected
outcome of these reforms was to secure a small and efficient government bureaucracy.
Among the main factors that contributed to this shift were the rise of neo-liberalism and the
changing role of the state in the West. At the peak of the Cold War, governments had greatly
expanded. They were increasingly criticized for being overly centralized, bloated (big), inefficient,
and unresponsive to the demands of the changing environment. In this context, proponents of the
neo-liberal ideology argued that markets are more flexible and superior to government institutions
in producing social welfare. The pro-market leadership in the United States and the United
Kingdom (i.e. the Reagan and Thatcher administrations) and the weakening and eventual
dissolution of the Soviet Union emboldened those advocating for the virtues of the minimalist state.
The failures of the previous development initiatives also lent support for this shift. These earlier
initiatives were seen as solely government-driven and their failure was believed by the neo-liberals
to have come as a direct result of too much government.

In contrast to the 1950s, this time around the public sector reforms were heavily influenced less by
public administration experts and specialists, but by economists who have populated and influenced
the leading development agencies at this time. During this wave neo-classical economics
established itself as the most influential discipline in the development community. The theories
aligned with the prevailing political sentiments at this time have been bolstered at the expense of
those who presented divergent views on the role of the state. Modernization came under attack, as
did Keynesian economics, while the Chicago schools‘ (the intellectual basis of the neoliberal
ideology) influence on policy makers increased.
42
The influence of the schools advocating the invisible hand of market forces as the driver of
economic development ascended across the social sciences disciplines, including in public
administration. The growing dissatisfaction with the actual embodiment of the Weberian
bureaucratic model in Western institutions also fueled the growing anti-government and anti-
bureaucratic sentiments.
Public choice theory has exerted prevailing influence on public administration since the 1970s.
Rational choice theories (RCT) assume that people are rational actors with clear and consistent
preferences, and that they act on their economic self-interests. The theories holding this assumption
are criticized for neglecting the competing and unclear preferences people hold, as well as their
other motives – besides economic self-interests – including those based on their values and
obligations.
Public choice literature is concerned with the problems of the ―free riders who take advantage of
the opportunities provided by government institutions. Drawing on the assumptions of rational
choice theory, bureaucracy came under particular attack as a self-serving category that takes
advantage of policy makers by virtue of controlling information (principal-agent problem). The
researchers of this school inferred that cutting down bureaucracy and subjecting it to greater
external checks and control is needed. The donors came to promote this recipe, assuming that
exposing government organizations to pressures and competition would result in leaner and more
efficient government institutions.
Most of the public sector reform programs that have taken place in developing countries during this
wave were introduced as part of the ―Washington consensus‖ which informed the Structural
Adjustment Programmes (SAPs) of the World Bank in the 1980s. The content of the reforms
projected the main tenets of the Washington Consensus and the New Public Management (NPM).
While the language of IDA emphasized macroeconomic policies, which is the main concern of the
―Washington consensus‖, implementing them required eliminating, changing, and creating
governmental institutions so as to support those reforms, especially in the countries that did not
have market economies; this is where the NPM came in. In this manner, institutional development
was an essential component of this wave of reforms in policy, which is supposed to be translated in
to practice through the NPM.
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3.2.2.1 The Washington Consensus

The key principles underlying this wave of reforms were captured in the so-called and much
discussed Washington Consensus, a term coined in the early 1990s by economist John Williamson.
He observed that political Washington embodied by the US Congress and President‗s
Administration, and the technocratic Washington embodied by the IMF, World Bank, and the think
tanks, converged which policies should be promoted in developing countries to induce growth, a set
of ten prescriptions that included: Fiscal discipline, Redirect public expenditure, Tax reform,
Financial liberalization, Adopt a single, competitive exchange rate, Trade liberalization, Eliminate
barriers to foreign direct investment, Privatize state owned enterprises, Deregulate market entry and
competition, and Ensure secure property rights.
These policies referred to simultaneously initiating and implementing macroeconomic reforms

strategy. The latter consisted of (1) liberalization of prices and elimination of trade barriers; (2)
macroeconomic stabilization - the process through which inflation is brought under control and
lowered over time; (3) restructuring and privatization – the processes of creating a viable financial
sector and reforming the enterprises in these economies to render them capable of producing goods
for free markets and of transferring their ownership into private hands, and (4) legal and
institutional reforms, needed to redefine the role of the state in the economy, establish the rule of
law, and introduce competition policies.
The IMF emerged as the chief authority on macroeconomic policy reforms, while the World Bank
initially assumed the greater role in promoting institutional reforms. Between them, they set the
tone in the development field, owing to their extensive funding and their expanding in-house
expertise. Backed by the U.S. presidential Administration and the U.S. Treasury, the IMF was
especially forceful in promoting the tenets of the Washington Consensus through its conditionality
loans. The IMF‗s role became even more prominent with the fall of the Berlin Wall as the
bankrupted countries one after the other turned to the IMF for loans. The vastness of this task
strained even the IMF‗s financial resources, which is why the World Bank was brought into support
the IMF‗s mission. Not surprisingly, this wave of reforms affected a large number of countries in
Africa, Asia and Latin America.
The reform of government institutions was given minimal attention; they were overshadowed by
the prevailing focus on revamping economic policies. In addition, these reforms were not perceived
44
to directly relate to macro-economic functions of the government. The attention paid to public
sector reforms was also minimal in view of the perceived urgency of the political and economic
reforms and the growing anti-bureaucratic sentiments.
The most important reason why the reforms paid minimal attention to public sector reforms is that
donors naively assumed that effective institutions would fill in the institutional vacuum once the
macroeconomic reforms were implemented. This is not surprising because this wave of reforms
was shaped under the influence of the laissez faire doctrine which holds that unleashing market
forces would institutionalize the new types of behavior and lead to more efficient institutions and
more economic growth. In sum, administrative reform was subsumed under this new market-
oriented paradigm during this wave of institutional reforms. The leading IDA argued that
development is best achieved not through government which, it was believed, actually hinders
development but through market forces that need to be freed from the grip of government
regulation via the right macroeconomic policies.
3.2.2.2 The New Public Management

The reform of the bureaucracy (public administration) during this wave was narrower in scope than
traditional administrative reform. The civil service system was the main target of these initiatives;
pay and employment, and within those, reducing numbers were the chief concerns. Little attention
was paid to the improvement of its recruitment, management, performance and ethos, while cutting
its rules, regulations, and bureaucracy‗s role in policymaking constituted the crux of this wave of
public sector reforms.
Although the ultimate goal of the reforms was to improve the institutions and management capacity
of the civil service by inducing principles and practices from the private sector (the NPM), in
practice the reforms have been largely limited to downsizing through short-term cost containment
measures such as employment cuts and wage reforms.
At the same time, the broader term public sector reforms began to replace the previously used
administrative reforms. The former was more convenient and provided more room for including
reforms to public enterprises that did not comfortably fit within the boundaries of traditional
administrative reform. Thus, the scope of institutional public sector reforms expanded to
encompass the private and, indirectly, the political institutions, via promoting deregulation,
45
decentralization, downsizing and structural reforms. These changes affected the context of the
bureaucracy and the distribution of power in society more than the previous wave of reforms. The
overarching vision of public sector reforms promoted by donors in the second wave could be
illustrated through the figure that follows.
Figure 2: The Vision for Public Sector Reforms in the Second Wave of Reforms
The core paradigm which can be discerned as influential in the development of public sector
reforms in the 1980s and 1990s was that public sector provision was inefficient and often
ineffective; that it led neither to cost containment nor to quality improvement. With the problems so
defined, the paradigm extended to a belief that the public and private sectors did not have to be
organized and managed in fundamentally different ways. Indeed that it would be better for the
public services if they could be organized and managed as much like the private sector as possible.
The focus of the NPM movement therefore, was on creating institutional and organizational
contexts which are to mirror what is seen as critical aspects of private sector modes of organizing
and managing. Public sector reforms taking place in Africa today build on previous programmes.
However, they also fundamentally question the role and institutional character of the State.
What, then, is the NPM?
In the literature on public sector and institutional reform, the NPM has been variously called:
‗managerialism‘, ‗new public management‘, ‗market based public administration‘, ‗entrepreneurial
government‘, the new steering model etc. It is a set of broadly similar administrative doctrines,
which dominated the public administration reform agenda of most OECD countries from the late
1970s. It captures most of the structural, organizational and managerial changes taking place in the
46
public services of these countries, and a bundle of management approaches and techniques
borrowed from the private sector. The goal of the NPM is to implement the ‗3Es‘: efficiency,
economy and effectiveness.
David Osborne and Gaebler, in their book entitled Reinventing Government (1992) identified ten
defining characteristics of what they call Entrepreneurial Government (EG), namely:
 promoting competition between diverse providers of goods and services
 empowering citizens by pushing control out of the bureaucracy
 measuring performance of their agencies focusing particularly on outcomes than inputs
 driven by mission, not by rules and regulations
 redefining their clients as customers and offer them choices
 preventing problems rather than cure them after they blew out
 putting their energy in to earning money, not simply spending it
 decentralization of authority, embracing participatory management
 preference of market mechanisms than bureaucratic mechanisms
 Focusing on catalyzing all sectors- public, private and voluntary-in to action, not simply
on providing public services, to solve societal problems.
Osborne and Gaebler‘s, EG, which is driven by the NPM and the New institutional economics
has the following characteristics:
1. Catalytic Government: acting as a catalyst influencing the private sectors actions to solve
societal problems
2. Competitive Government: encouraging competition to increase the level of performance
and minimize cost (e.g.: competition among public schools to improve quality of
education)
3. Mission driven Government: Defining fundamental missions, developing budget system
and framing flexible rules to free public servants to pursue goals without being enslaved by
rules
4. Results oriented Government: focus on outcomes instead of inputs
5. Customer driven Government: spending is tied to results and for this purposes resources
are given directly to consumers to let choose appropriate providers at a minimum cost
47
6. Decentralized Government: by decentralizing or getting authority down to the lowest level,

organizational functioning will be improved as information and communication and
decision-making would then be located at the actual site of the problem
7. Market oriented Government: by restructuring the market and leveraging the decisions of
the private sector, Government can accomplish more what it can do by financing
administrative programs
8. Community oriented Government: pushing control of many services out of the
bureaucracy in to the community
The notion of reinventing government, by Osborne and Gaebler was one of the most popular works
in the NPM movement, a perspective that underpinned the ideology of the anti-government/
bureaucracy movement of the 1980s. A point succinctly summed by Osborne in the following way:
We do not need more Government; we need better government. To be more precise we
need better Governance. Governance is the act of collectively solving our problems.
Government is the instrument we use. The instrument is outdated, and it is time to make
it.
Although different interpretations exist as to what constitutes the core of NPM, the common claim
among proponents of NPM is the call for using the insights and principles that worked well in the
private sector such as competition, decentralization, flexibility, and pay for performance to induce
efficiency, economy, and effectiveness in the public sector. Their major argument in favor of their
approach is that traditional public administration institutions are deficient.
It is said to be a global phenomenon. The NPM was first popularized in the United States, the
United Kingdom, Canada and New Zealand and spread its influence over public administration
reforms in other countries around the world, especially in the Commonwealth countries. OECD,
representing wealthy countries perspective, has been instrumental in developing and disseminating
best practices informed by NPM. The relative success of NPM in these countries can be partly
explained by the fact that it was launched on the basis of already solid governing institutions.
In these countries, constitutional democracy and the rule of law was already firmly established. In
addition, there has been a fair amount of adaptation of NPM principles to realities of OECD
countries that have adapted them as evident in the variation in the content/scope, process, and
48
outcomes of reforms observed in these countries. In contrast, in many of the developing countries
where these conditions did not exist, NPM‗s contribution has been questionable.
From the forgone discussion, it seems apparent; the overall emphasis of the NPM is changing
bureaucracies into result-oriented organizations, in which managers would be accountable for
achieving targets and results. With NPM, reduction in the size of Government, reducing the
functional load of the bureaucracies, speed, results, and accountability soon become the buzzwords.
Historically bureaucracy has always been under attack as power grabbers, secretive, rule bound,
inward looking, and the like. In this respect, the criticism of bureaucracy by the NPM does not
seem something new. However, the contemporary objection to bureaucracy by the NPM is unique
in that, it represents a savage onslaught on bureaucracy as the main source of mal-governance and
the various social evils afflicting humanity at the turn of the 21st century.
What are the Major components of NPM?

The key components of NPM may be put into two broad categories – those that emphasize
managerial improvement and organizational restructuring, and those that emphasize markets and
competition. The basic foundation of the NPM movement, however, is the drive for efficiency and
the use of the economic market as a model for political and administrative relationships in the
public sector.
In addition, the institutional aspects of NPM derive from the ―new institutional economics‖
movement, which has a theoretical foundation in public choice, transaction cost and principal-
agent theories. These generated public sector reforms themes are based on ideas of market,
competition, contracting, transparency, and emphasis on incentive structures as a way of giving
more ―choice‖ and ―voice‖ to service users and promoting efficiency in public service delivery.
The NPM has several interrelated components that cut across the traditional ways of organizing
governments. The first relates to the delivery of high-quality services to citizens (redefined as
clients by the NPM). The consumers of services are re-conceptualized as customers, not just
passive recipients. Hence, serious attempts are being made to find out what customers expect. In
this regard, public sector organizations, for instance, in UK and Singapore have set performance
targets and attempted to measure performance and publicize results for the wider public. The most
49
dramatic of such initiatives is citizens‘ charter in England, a global statement of the government‘s
service quality improvement.
Improved efficiency is now the overriding aim of public sector reforms in most African countries.
It is thought that the State‘s capability, its ability to promote and undertake collective action
efficiently is overextended. Therefore, reductions and a refocusing of the State‘s activities are
needed to improve macroeconomic stability, as well as the implementation of stronger incentives
for performance. Furthermore, increased competition in service provision, both with the private
sector and in the public sector itself, is required in order to raise efficiency. Consequently,
governments should concentrate their efforts less on direct intervention and more on enabling
others to be productive by providing ―core‖ functions such as safeguarding law and order;
protecting property rights; managing the macro-economy to promote and regulate the market;
providing basic social services and infrastructure; and protecting the vulnerable and destitute.
Despite the move to reduce the role of the public sector, there is broad agreement about the need to
increase the capacity of the State. To do this, varieties of NPM-inspired measures are used. These
includes: the refocusing of public-sector functions through staff reductions and changes in
budgetary allocations; restructuring of public organizations through the reorganization of
ministries; decentralizing, delinking or ‗hiving off‘ central government functions to local
governments or the private sector; emphasis on private sector styles of management practice;
marketization and introduction of competition in service provision; explicit standards and measures
of performance; greater transparency; pay reform; and emphasis on outputs.
3.2.2.3Approach to the Reforms

Has the approach to institutional reform changed in this wave?
While the content of the public sector reforms had changed since the first wave, the approach to the
public sector reforms did not depart much from the accustomed practices. In the same way as with
the overarching macroeconomic reforms, public sector institutional reforms, when they received
attention, were limited mainly to importing best practices and policies, and changing formal
organizational and internal rules and regulations with the help of external consultants paid by the
donors. The donors still assumed that the same set of policies would benefit every country
regardless of the individual countries‘ circumstances.
50
The key macroeconomic and political decisions were made by the donors with little consultation
with the beneficiaries. While the loan conditions constituted the new element in the approach to the
reforms promoted by IDA during this wave of reforms, they were accompanied by technical
assistance (TA) projects, which employed the same approach to reforms as did the experts in the
first wave of reforms. In addition, the technical assistance segment is characterized by many
problems of its own.
Since institutional reforms were focused mainly on changing formal institutional and organizational
frameworks and modeling them after those borrowed from the West, copying and passing laws
without regard to their institutionalization prevailed. Little attention was paid to the human and
organizational factors that should give meaning to those laws. During this wave, donors still
showed little regard for understanding beneficiaries‘ needs; the reform agenda was externally
determined. In fact, this aspect has become even more pronounced during this wave of reform as
the donors‘ influence grew along with the countries‘ need for external assistance. Beneficiaries still
did not have much input in selecting the content of the reforms in part because those reforms came
for free and was a condition for receiving the much-needed loans from the donors. Despite the
change in terminology from administrative to public sector reforms, the fragmented and technical
approach to reforms was still evident in the piecemeal focus on the aspects of the changes that were
easiest to implement in short time frames. Pay and employment reforms in the civil service and the
privatization of public enterprises were carried out without a clear strategy to account for the
broader institutional context.
The increased use of conditionality to promote macroeconomic reforms, and along with that the
downsizing of the public sector, contributed to the deepening of these problematic approaches to
the public sector reforms. In addition, the other problems present in IDA‗s previous wave of
institutional reforms – poor understanding of the beneficiaries‗ existing institutions and how
institutions change overall, as well as the ignorance and ethnocentrism of the donors – combined
with the recipients‗ desire to secure external legitimacy by adopting influential donors‗ models and
frameworks and the desperation of their officials to find ways out from their crises, contributed to
the persistence and entrenchment of the discredited approach to the reforms
3.2.2.4Assessment of the Outcomes of the Reforms

What about success?
51
The leading donors and independent observers agreed that overall, this wave of reforms, despite
some successes, had failed to live up to its promises. The overall consensus among observers of
these reforms was that despite some bright spots, donors‘ aid at times encouraged incompetence,
corruption, and misguided policies. With the lack of viable government or other alternative
institutions to provide the rule of law and enforce policies, the macroeconomic and public sector
reforms created opportunities for a few vested interests – the new entrepreneurs who emerged from
former government elites and their allies – to concentrate government assets in their hands, and
even tailor the new government regulations for their own benefit. These processes closely tied
newly emerging business sector and government elites together in illicit informal networks.
Among the many critics of the IDA policies, former chief economist at the World Bank Joseph
Stiglitz (2000) faulted both the content and approach of the reforms prescribed by the IMF for
contributing to and furthering financial crises in developing countries that followed its advice. He
argued that the content of the reforms was informed by outdated and simplistic economic models.
They were also misguided because they did not account for the peculiarities of each country.
Moreover, the IMF‗s approach to policy making furthered these problems and prevented it from
adjusting even when the mistakes became obvious. Other critics emphasized the contrast between
the IDA‗s macroeconomic policy outcomes with the approach that led to the Asian miracle. East
Asia‘s fast-growing economies owed their success in part to stable government institutions and the
active intervention of the state in promoting economic development.
The outcomes of the reforms specifically targeting the inner working of the public administration
system, not surprisingly, also were not encouraging. As mentioned above, the World Bank mainly
focused on downsizing civil service and paid little attention to institutional and capacity building
aspects of the reforms. As a result, the failures and negative unintended consequences of the big
bang macroeconomic reforms, the increased criticism of the IDA approaches, and successes of
alternative models of development combined to challenge the leading donors‘ minimalist state
arguments. Thus, those donors were forced to reconsider the assumptions informing their
development interventions.
? What Lessons were learned from the Reforms?
52
Various soul-searching attempts on behalf of the donors generated valuable lessons, most of which,
not surprisingly, were not new; they painfully rediscovered the lessons from the first wave of
institutional reforms. Out of these the lessons which were taken to heart were the following three:
A. Government Institutions Matter: The donors underscored that without strong and capable
government institutions, markets cannot effectively function. The reform failures demonstrated that
governments in many developing countries did not have the skills, capacity, and accountability to
implement complex macroeconomic structural adjustment reforms properly and make effective use
of aid. They also noted that in corrupt environments, those reforms, especially privatization of
government assets in former socialist countries, have been further derailed to serve private
interests, which undermined the already weak legitimacy of these governments.
Moreover, government institutions were also found essential for dealing with social issues such as
poverty and education that topped the donors and world leaders‘ agenda in the last decade of the
20th century. The IMF, for example, recommended that the transitional economies needed to keep
pursuing sound macroeconomic policies (the Washington consensus) and at the same time build the
institutions required to underpin a market economy.
B. One Size Does Not Fit All: The one-size-fits-all approach was also challenged by all
stakeholders. Instead, understanding and tailoring reforms to specific contexts of recipient
countries came to be emphasized. The IDA learned that the reforms need to be tailored to a
specific context; and even that best practice in institutional development is a flawed concept.
C. Participation from Beneficiaries is Essential: The reformers also noted the importance of
beneficiaries‘ involvement in the design and implementation of reforms to secure that the
changes effected by interventions sustain. Thus, instead of a supply of experts and equipment
from abroad, reformers started looking at the ways to improve local capacity by increasing the
involvement of the beneficiaries.
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Section Three:
3.3 The Third Wave of Institutional Reforms since 1997: The Re-Emergence of
Institutional Development and Government as a Facilitator of Good
Governance
3.3.1 Policy Context
A confluence of several factors influenced donors‘ decision to launch a new wave of institutional
reforms. One of the main contributors to this shift was the increasing amount of evidence pointing
at the limits of relying purely on market-regarding policies. Contrary to donors‘ prescriptions, not
all the countries that followed the Washington Consensus prospered as a result of the reforms.
If anything, evidence from the Asian crisis, the experiences of transition from command to market
economy, and situation in much of the underdeveloped world provided examples of human costs of
neglecting the proper role of institutions.
The problems IDAs are facing in their own governing institutions further increased the focus on
institutional reforms. The OECD countries, similarly, had been experimenting with large-scale
institutional reforms trying to respond, among others, to the challenges of changing environments,
the expanding globalization, and the fiscal crisis of the welfare state. These reforms directly and
indirectly influence the content and approach to the reforms the donors promote in developing
countries.
A set of other factors further highlighted the emphasis on the quality of governance institutions.
One of them is the growing concern with aid effectiveness. The donors noted that the governments
with better institutions made more effective use of development aid, while in countries with poorly
functioning government institutions aid did not make much positive impact. The worldwide social
issues and humanitarian emergencies also drew attention to the capacity and quality of
governmental institutions. The widening income gap between countries and individuals, especially
in the poorer countries, and other pressing social issues such as education and health also played a
role in shaping the new content and approach to this new wave of reforms. The adoption of the
Millennium Development Goals targeting the reduction of poverty necessitated sustainable
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development strategies that would take into account not only economic growth, but also the social
and political dimensions of development.
A distinct characteristic of the policy context of the current wave of institutional reforms is that the
major IDA involved in promoting institutional reforms are converging in their assumptions on and
approaches to the delivery of development assistance. From the late 1970s until the late 1990s, the
World Bank, IMF, and USAID favored neo-liberal policies, while other IDA such as the UNDP
and European Commission (EC) tended to favor a more balanced approach accounting for both
government and market institutions. These differences among donors diminished in several steps.
In sum, since 1997 the new consensus that emerged among IDA is that development interventions
need to secure good governance to generate political, economic, and social development, and that
building government‘s capacity via institutional development/change is the prevailing
approach/means of pursuing these ends. Another important but subtle change took place in this
wave in the vocabulary of donors. Most donors started talking more about capacity building and
capacity development, instead of the previous institution building and institutional development.
Who do you think the most influential IDA in public sector reforms during this wave?
In this wave, the World Bank and the United Nations consider themselves the leading among the
IDA supporting public sector institutional reforms. Most other donors involved in institutional
reform, including the European Union (EU), Asian Development Bank (ADB), United States
Agency for International Development (USAID), UK‘s Department for International Development
(DFID), and Swedish International Development Cooperation Agency (SIDA), have either a
regional or bilateral focus and narrower program scope, while the World Bank and UNDP have
worldwide reach and a broad reform agenda.
The World Bank emerged as the most influential think-tank and donor in institutional and
governance reform since the late 1990s. The World Bank‘s public sector reform agenda has been
evolving over a period of time and became more focused since the late 1990s. Since then, the
World Bank has changed its aim to align it with its mission of reducing poverty as it was becoming
increasingly apparent that its previous market-oriented focus was not well-suited for promoting this
mission. The World Bank exerts greater influence on the actions and policies of developing
55
countries and other donors owing to its large grants and loans along with its extensive knowledge-
generating research network.
The United Nations historically focused on the institutional development of public administration
in its core support areas. Institutional development (ID) is the process of planned reforms
undertaken to artificially change the existing and/or devise new institutions has been tacitly
accepted as a major effort [for UN] in promoting consistent accelerated economic, social and
political progress in developing countries since the emergence of the official development
assistance field at the end of WWII. In the last decade, when the institutional development
movement reemerged, the UN also re-established itself as the chief authority in public sector
reforms among donors.
Within the United Nations, the Division for Public Administration and Development Management
of the Department of Economic and Social Affairs of the United Nations (DESA) focuses on
analytical work and policy setting reforms. UNDP, an important arm of the United Nations, is
involved in implementing public administrative reforms (PAR) because it has a mandate to design
programs with the highest long-term impact on the poor and disadvantaged. Public administration
is seen as most suitable tool for pursuing this mandate. An efficient, responsive, transparent and
accountable public administration is a central part of democratic governance and the basic means
through which government strategies to achieve the MDGs can be implemented. Public
administration is incorporated within its Democratic Governance program.

Two schools of thought that share similar assumptions influenced donors‘ public sector reforms
during this period more than other schools. One of them is New Institutional Economics (NIE). It
shaped the overall direction and rhetoric of leading donors‘ reform policies. Another is New Public
Management (NPM), discussed in the previous chapter, which informed the specific details of the
public sector reforms.
By the 1990s, traditional theories of economic growth focused on labor, physical and human capital
accumulation as well as on technological change were found inadequate in explaining the
differences in economic growth among nations. At around the same time, extensive research in NIE
linking institutions to economic growth gained influence among donors. The NIE movement,
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sometimes referred to as new political economy, has had significant influence in social sciences for
the last few decades. The NIE emerged from extensive borrowing and modification of assumptions
and analytical tools from neoclassical economics and rational choice theory (RCT) to apply to
research in political science, public administration, and sociology. According to Langlois (1986),
the three themes underlying NIE are (a) a broader conception of the economic agent, (b) shift of
attention to economic processes from equilibrium states, and (c) recognition that coordination of
market activity is a matter of not only markets, but also alternative institutional structures.
NIE influenced the leading donors‘ development policies through two sets of findings: one on the
role of equality and economic growth, and another on the links between institutions and economic
growth. First, this school‘s claim that more equal distribution of income and wealth is conducive to
growth- run counter to the neoclassical economics which held that unequal income was a
prerequisite to growth. This finding, along with Amartya Sen‘s capability approach, reinforced the
poverty reduction and human development policies of the leading donors like the World Bank.
NIE‗s claims that development depends on the quality of institutions also caught donors‘ attention
just when donors needed it following the backlash of its previous wave of reforms. Students of NIE
argue that institutions present that missing link, which explains the differences in economic growth
across different countries, because institutions determine how inputs technologies, investments, or
policies are used. For example, North (1990) described the role of institutions as follows: Third
World countries are poor because the institutional constraints define a set of payoffs to
political/economic activities that do not encourage productive activity. They also hold that efficient
institutions are those which provide the right incentives to individuals. Such institutions are created
through competition.
The World Bank‗s key policy documents that set the stage for the new wave of institutional reforms
draws predominantly from this strand of research. The research used in World Bank‘s policy
documents found that certain features of institutions - accountability, efficiency in service delivery,
transparency – are strongly correlated with the long-term growth and poverty reduction.
While there is agreement that good quality institutions are necessary not only for economic
development but also on other grounds such as provision of human rights and democratic
governance, and NEI‗s contribution for the improved understanding of institutions has been
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notable, NIE‗s research on institutions has been challenged for not being able to specify the nature
and causal relationships among the quality of institutions, functions of institutions, the process of
institutional reform, and outcomes of reforms.
The public sector is still expected to become leaner and perform more effectively in fulfilling its
core functions. The IDA‘s emphasis on incentives and competition following the NIE scholars
further reinforced the assumption that public sector institutions need to be deregulated and exposed
to greater competition and accountability internally and from outside. It is implicitly assumed that
the effectiveness of government institutions is less a function of direct organizational development,
but results from changing incentives (rules of the game) that expose them to greater competition
from the private sector and demand from citizen-customers. In sum, the principles according to
which the private sector institutions operate, when applied to public sector institutions, are expected
to generate socially-beneficial incentives and behavior.
The New Public Management (NPM) movement in public administration and development
management, that shares assumptions of the political economy/NIE movement, similarly has not
been able to specify the nature and causal relationships among the quality of institutions, functions
of institutions, the process of institutional reform, and outcomes of reforms.
Lacking clear understanding of causal relations, NPM draws from the institutional models and
practices of OECD countries that serve as benchmarks for practitioners, and emphasizes universal
management standards as a remedy for problems of developing countries. On the management side,
the thematic core of development management is today's version of NPM, exemplified by the
OECD's approach to public management reform, leavened with the strategies and tools associated
with core administrative functions (e.g., budgeting, human resources), organizational and systems
change, institutional structuring (e.g., decentralization, subsidiarity), promoting citizen
participation, and management training. Interesting, NPM approach goes against donors‘ rhetoric to
tailor reforms to the recipients‘ contexts.
From a theory perspective, this NPM core is problematic in that, to an important extent, it
constitutes a list of actions to be pursued rather than an analytically integrated agenda that reflects a
set of causal relationships. There are ongoing debates around necessary and sufficient conditions,
linkages, sequencing, and impacts. The one-size-fits-all managerialism of NPM needs to be
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interrogated, and ultimately nuanced, by "empirical studies covering diverse countries and regions,
longer time frames, and multiple dimensions of governance in order to review cross-national
similarities and differences in major reform trends, rationales, contexts, [and] impacts". Given the
tendency toward idealized thinking about development management that NPM embodies, it is
important to maintain a critical perspective on the underlying factors that influence outcomes and
impacts.
In sum, the research informing donor policies has been criticized as being partial and poorly suited
for understanding, let alone informing, the design and implementation of institutional reforms.
While the key problems on the way towards creating effective institutions involve intangibles such
as values and trust issues, the research informing donors‘ institutional reforms, namely NIE and
NPM movements, has been based on the set of assumptions on human behavior that has little room
for these factors.
3.4 The Content of and Approach to the Reforms

This wave of reforms is distinct from the previous ones in a number of ways: donors changed not
only the content of its reforms, but also are attempting to change the approach to conducting their
interventions to address their past shortcomings. The content of the IDA‘s reforms shifted away
from the market to promoting good governance through sets of institutional reforms. Reforming
administrative institutions is seen as a chief mechanism for transforming other institutions in the
governance system. Unlike the reforms in 1950s, this time the state and government institutions are
seen not as direct providers of goods and services, but more as facilitators of economic growth. The
IDA now argue that the government‘s main responsibility is to create the right conditions and
incentives for the private sector and civil society, which are seen as complementary players in the
broader governance process along with the government.
The IDA‘s new approach to institutional reforms, at least in policy documents, also became more
aligned with what they prescribe the recipient governments should do towards their own citizens.
The IDA are now trying to make their interventions more participatory, beneficiary-driven, and
tailored to each specific context, and they seek to design systematic public service reforms
coherently integrated with other institutional reforms. It is assumed that this new approach will
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positively affect the outcomes of the development interventions. Below, a brief overview of the key
and shared elements in the content and approach of the key IDA‘s public sector reforms.
Figure 3: The Vision for Public Sector Reforms in the Third Wave 140
3.4.1 Content of Public Sector Reforms

This wave of institutional reform differs from the previous ones in several aspects. The previous
reforms paid attention to both changing rules and promoting the capacity of organizations entrusted
with enforcing those rules and emphasized organizational capacity building (i.e. organizational
development) over rule change. The current reforms tend to emphasize rule change over the
development of capacity to enforce those rules, and focus more on macro-
level/constitutive/governance institutions and on the relationships between public, private and
increasingly also nonprofit sectors. In contrast, the previous ones focused more on [meso-level]
organizational rules and resources. Second, the current reforms intend to change not only
administrative or judicial institutions, but also economic, political, and societal institutions that
together make up governance institutions. The focus of this wave therefore is on integrated
governance reforms.
Although the previous reform interventions often contained some components targeting
improvement of the effectiveness and capacity of government institutions, those components have
been disjointed, and since the 1970s subsumed under other priority policies. Policy-makers in IDA
are finally acknowledging that institutions are interdependent and the reforms need to account for
this reality. This, at a minimum, means that changing economic or political policies and even
institutions alone will not be sustainable unless public administration systems are also reformed.
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By the same logic, administrative reform is no longer about transforming the administrative state
per se but transforming governance, the relationships between societal institutions that exercise
authority within a single country/state, a group of states, or a country association. Today‘s
institutional reforms focus not on a single institution, but the whole governance system.
Public administration is now seen as central to governance reforms, especially in the countries with
the weakest government capacity. For example, public sector reform is now in the heart of the
World Bank‘s overarching agenda of improving governance, which falls into three broad
areas―rule-based operation of the government itself to improve the supply of public goods, voice
and accountability for citizens to demand better public services, and more efficient and effective
regulation of the private sector to improve its competitiveness. Similarly, the UNDP treats public
administration reforms as central part of its Democratic Governance program.
The redefinition of development as a matter of high-quality rules of the game resulted in a

confluence of administrative changes with the rule of law reforms, both in terms of content and
methods. Rule of law is the continuation of the previously tried and abandoned rule and
development field concerned with improving the capacity of the judiciary. Now rule of law is a part
of the broader public sector reforms. Moreover, this field of practice regained greater influence
among donors. If law and development was promoted mainly by the US aid community, this time
rule of law is deemed as an essential component of institutional reforms by almost all IDA. Rule of
law is appealing to IDA because it is considered essential for promoting economic growth by
attracting investors, as well as for democracy.
In sum, in terms of the content of reforms, this time donors are trying to focus on a large set of
institutional transformations under the governance agenda that emphasizes the facilitative role of
public administration.
3.4.2 Approach to the Reforms

IDA‘s approach to institutional reforms shows a radical departure from the old approach, but
mainly in policy rather than in practice. This change in approach is reflected in the following areas.
3.4.2.1 Focus on Outcomes Rather Than on Outputs
In contrast to the previous wave of public sector reforms, this time donors are attempting to focus
not only on the general idea of cutting government‘s size and role and infusing more competition
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through privatization, but also on specific features of NPM such as individual performance and
outcome-orientation in public management. These elements are promoted in the place of inputs,
process, and public service culture/ethos that characterized traditional public administration.
In other words, projects and programs of the donors are to be evaluated against their impact on the
overall governance environment. The recipients are therefore required to develop long-term country
level institutional development strategies and link donor projects to them, instead of simply relying
on ad-hoc supply-driven aid. Example of such country level-strategies are Poverty Reduction
Strategy Papers (PRSP) and Comprehensive Development Framework (CDF).
3.4.2.2 Efforts to Tailor Reforms to Their Context
Meanwhile, IDA has been increasingly emphasizing the need to adjust reforms to the specifics of
each country thorough better understanding the recipients‘ needs. This lesson has been vividly
highlighted owing in part to the failures that followed the one-size-fits-all approach of the
Washington Consensus reforms promoted by the IDA a decade earlier.
The realization that best practices may not work if not tailored to the local context and the
importance of a clear understanding of the problems and desired outcomes prior to interventions
have influenced the IDA‘s approach. For the first time OECD countries, similar to what developing
countries have been undergoing for a few decades, also experimented with best practices borrowed
from other contexts. Performance-based budgeting and NPM reforms popularized through New
Zealand‘s successful example have been tried in many countries, but led to different and not always
desirable outcomes even in OECD countries.
3.4.2.3 Emphasis on Participation and Local Ownership
Furthermore, IDA has been trying to re-orient their policies to make the institutional reforms more
demand-driven. It is assumed that fostering local participation, voice, and ownership will improve
not only the beneficiaries‘ aid effectiveness, but also will strengthen the quality of institutions and
local capacity and accountability of authorities. Although the World Bank still intends not to
interfere in political matters of the recipient states, this new approach implicitly and indirectly
embraces the political nature of the reforms and the need to change the existing distribution of
power for the public sector reforms to succeed. The World Bank, however, has reservations when it
comes to popular participation in macroeconomic policy (both monetary and aggregate fiscal). It
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perceives that participation in these areas can be easily captured by special interests, and are best
carried out by organization [by qualified experts with technical expertise] insular from the
exigencies of everyday politics.
In sum, the traditional top-down and externally-determined approach to the reforms, which
consisted of the transfer of skills and formal elements of institutions or organizations to developing
countries, designed and implemented by foreign experts, is falling out of favor, at least in policy
rhetoric. Instead, the IDA came to recognize that to make aid effective they need to tailor the
reforms to beneficiaries‘ specific needs and make lending support locally-driven and owned. The
current consensus is that IDA should help developing countries build government institutions
capable of making sound policies themselves without relying on external advisors, only through
such institution-building will countries be able to achieve the ultimate goals of poverty reduction,
inclusion, environmental sustainability, and private sector development.
Chapter Four
The Dynamics of Public Sector Institutional Reforms
Section One:
4.1 Civil Service Reform
4.1.1 Meaning and Organizational Principle of the Civil Service
4.1.1.1 The Meaning of Civil Service
There is no standard definition of civil service or civil servant in the academic literature. A
comparative study of civil service systems asserts that ―civil service‖ is differentiated from public
service‖ and indeed, in every case found in the literature the civil service is defined as a subset of
persons employed to provide a public service. However, authors diverge when it comes to an exact
definition of the term. The differences arise in two respects. One concerns the composition of that
subset, that is, the categories of public service employees that are considered ―civil servants.‖ Thus,
military personnel are generally excluded, but many categories of civilian employment are also
excluded, such as those in local government, state enterprises, judges, teachers and health
professionals. In addition, most authors choose to exclude elected officials, and, though rarely
mentioned, police appear to be excluded along with the military. A common approach is to apply
the civil service concept to central administration employees, including administrative personnel in
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the military and social services sectors. Often, however, authors fail to specify which public service
workers are included in their discussion.
A second source of definitional variation arises when the term ―civil service‖ is applied not to a
specified category of employees but rather to the institutional arrangement under which they are
employed. In practice, public service can be carried out under a variety of contractual and
administrative arrangements, but many authors reserve the term ―civil service‖ for career
employees working under an explicit ―civil service‖ law. Such laws differ not only from private
labor legislation but also from a variety of contractual arrangements used for particular public
services.
Under that institutional definition, the principal subject of analysis is the functioning of the legally
defined civil service regime, paid out of tax revenues in the form of budgeted posts, rather than the
broader human resource management problem of the public sector since the latter can include a
variety of employment regimes with a variety of sources of finance. In most cases the explicit or
implicit subject is the former, that is, public employment under a formal employment, even within
the more strictly administrative category of general government functions.
In examining the experience with civil service reform, it is important to first touch on definitional
issues with regards to the civil service. There is an immediate challenge in identifying who is a
member of the civil service. In addition, there are at least three key organizational features of those
employment regimes, namely their organizational principles, forms, and specific arrangements that
help define the civil service as an institution.
4.1.1.2 Organizational Principles of Civil Service
Scholars agree that civil services of developed and developing countries have been organized
following common principles that, taken together, have made the civil service different from other
employment arrangements. Those principles are merit, competence, continuity, political insulation,
and accountability, and they underlie the traditional or basic model of the civil service. The logic of
this model can be summarized as follows:
 Merit-based system means seeking out the most talented citizens in a fair and open
competition. Civil servants are appointed by a public authority according to merit-based
criteria for selection as defined in a civil service law. Once appointed, civil servants are
granted job security with many legal and administrative constraints on arbitrary dismissal.
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 Job security and political insulation intended to promote political neutrality by civil
servants in service to the current government, to ensure continuity of program
administration despite partisan political agendas, and to protect employees from pa
 Patronage and arbitrary political actions. In particular, job security provisions protect civil
servants from political pressure that could lead to inappropriate personnel dismissals and
inappropriate behavior by civil servants.
 Standardized rules and enforcement procedures- Merit, competence, continuity, and
political insulation give considerable power to civil servants. Since civil servants are not
always committed to the public‘s interest, there is a need to limit and constrain that power.
Standardized rules and enforcement procedures, qualitatively and quantitatively, define the
function of office and circumscribe administrative discretion to monitor and control civil
servants, to uphold the legality and propriety of administrative action, and to ensure
accountability.
This basic model characterizes the nature of public service as different from private employment. It
defines office-holding as a matter of public law, and the office-holder accountable to a set of formal
rules that can be observed and regulated ―rather than to the informal and unregulated rules
governing patron-client relations in traditional government employment.‖ The interpretation of ‗job
security‘ has evolved over the years. What was once equated with absolute tenure is now more
commonly considered to mean protection from arbitrary dismissal. In this sense, ‗job security‘ does
not protect staff that are incompetent or otherwise not meeting job requirements. But making such
distinctions has often proven to be difficult in weak institutional settings that do not have a merit-
based culture, which is common to many developing countries.
4.1.2 Civil Service Reform

Understanding and pursuing civil service reform begins with a broader vision of an effective public
sector. Schneider and Heredia see civil service reform as a sub-class of three major models of
public sector reform, each defined according to its main objectives and measures. These are:
Weberian reforms, accountability reforms, Managerial Reforms.
In their view, Weberian reforms were historically a first step towards better administrative
performance by governments. Such reforms sought to reduce particularism and politicization in the
bureaucracy and to counter the spoils system administration. These were followed by
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accountability reforms, designed to make the bureaucracy more accountable, and later, by
Managerial Reforms, which aimed to make the bureaucracy more efficient and customer oriented.
Nunberg and Kaufman recognize the usefulness of this historical distinction, but see it as more
applicable to OECD experience, and point out that the more fundamental nature of civil service
problems in developing countries often has required a combination of the three approaches.
Although these broader models of public administration have in turn lead to different strategies of
Civil service reform, there remains a significant degree of consensus around the core values of a
‗good‘ civil service as noted above: merit, competence, continuity, political insulation, and
accountability. The lack of agreement is much greater, however, with regard to what the civil
service should be doing differently to achieve the broader objectives of public sector reform.
4.1.2.1 Components of Civil Service Reform

Civil service reform (CSR), which implies developing the capacity of the civil service to fulfill its
mandate, defined to include issues of recruitment and promotion, pay, number of employees,
performance appraisal and related matters. In the 1980‘s CSR focused on the need to contain the
costs of public sector employment through retrenchment and restructuring, but has broadened
towards focusing on the longer-term goal of creating a government workforce of the right size and
skills-mix, and with the right motivation, professional ethos, client focus, and accountability.
The overall cost of the civil service remains a valid concern, of course. Addressing the causes of
and reversing the increasing civil service wage bill experienced by many countries in the 1970s and
1980s remains a primary concern. More recently, added to these problems, a number of others have
been better understood that relate more to the quality of the civil service and their motivation, such
as:
 Poor performance management, leading to inadequate incentives to perform well.
 Recruitment and promotion systems that poorly reflect the realities of the country, are often
overly concerned with formal education, and fail to attract or promote qualified staff.
 Politicization of the civil service.
 Lack of a mission or the respect of the public.
The following are the main issues that are commonly considered in designing CSR programmes.
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4.1.2.2 Mission
The central feature of mission orientation is a mission statement. The elaboration of the statement
itself is part of the process, as is the dissemination and articulation of the mission internally and
externally. While by no means anything more than a first step, having a mission orientation can
help establish a clear sense of direction and commitment within the organization, either for the
organization as a whole and for different departments and units by:
 Establishing a shared vision for public administration
 Helping managers clarify in their own minds what the business of the organization is
 Providing the focus for managers and other staff in meeting organizational goals
 Stimulating among the staff a sense of membership of the organization
 Providing a framework within which to determine targets and more precise objectives
 Providing a clear articulation for the public of the organization‘s reason for being.
4.1.2.3 Training
Under-qualified and insufficiently experienced personnel, sometimes promoted too quickly to

senior positions, is a universal problem in developing country civil services, and training is a
central feature of almost all PAR programmes. Interventions range from specialist technical
training to general educational and management skills. The big issues in training are: a) the
appropriateness of the training; b) selecting the candidates for training; and c) retaining trained
employees once they have been trained. While there are a number of types of training that could be
chosen, in-service training remains the most common. For more junior personnel these could
include training at a local training college, or deployment, while for mid-level and senior personnel,
specialized training has proven helpful. Study trips abroad are generally popular, and can bring
benefits, but are expensive and can easily be abused.
All training provides a form of perk, and scrupulous transparency is required in the selection of
candidates. However, it is rarely cost effective to invest in training civil servants unless there is a
programme to improve employment conditions. The fear that newly trained civil servants will be
wooed away to the private sector is often overblown (since civil servants rarely choose to
relinquish their benefits), but the danger of moonlighting and low motivation increases. A national
policy on training is important in securing the sustainability of training programmes. Finally,
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training is generally confined to central government employees. With decentralization, including

local officials within national training programmes is increasingly important.
4.1.2.4 Civil Service Systems

i. Career vs. Position
Merit based public employment systems can be broadly divided into career systems and position-
based systems. A career system is ‗closed‘ in the sense that entry is usually to the lower ranks and
more senior positions are filled from within the ranks. In position-based systems (also called job-in-
rank systems), on the other hand, the emphasis is placed on selecting the right candidate for the
position to be filled. The career system is most often associated with civil code traditions and the
position-based system with Anglo-Saxon traditions.
Choosing the appropriate system is the responsibility of the government and must result from
consultation and deliberation among the technical staff involved and relevant policy makers.
Because so many of the recent advances in thinking in public administration have taken place
within the Anglo-Saxon tradition, there is a tendency to favor features of the position system. Each
system has its merits and disadvantages. Where the position-based system can bring new talent into
the civil service where it is needed, and tends to free managers to focus on results, a career system
is better at providing incentives for good performance and at ensuring that investments in training
remain within the civil service.
Almost all developed country systems are increasingly hybridizing and adopting aspects of both a
position and a career system. Thus, countries with a civil code tradition can find useful examples of
a position structure in developments in the French model over the last decades, for example,
without having to rely simply on variations of the Anglo-Saxon tradition.
ii. Civil Service Management Arrangements

There are usually two main types of management arrangements for the personnel function: the
Anglo-Saxon type Public (or Civil) Service Commission (PSC) and its executive office, and the
Personnel Department or an Inter-ministerial committee with an executive office under the Prime
Minister or a cabinet minister in charge of the Civil Service which is usually found in the countries
under civil law. In addition to these there is usually also a financial control organ in the Ministry of
Finance, in charge of payroll management and budgetary control.
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The second choice that needs to be made is between a centralized and decentralized personnel
management system. A centralized personnel management system retains close supervision of the
personnel management functions at central level. The decentralized model increases the decision-
making autonomy of the line managers on most personnel management functions (such as
recruitment, promotion, and training) leaving the center with the responsibility of defining broad
policy guidelines, issuing regulations, and monitoring the performance of the decentralized
personnel management units. In a number of countries however, appointments to the senior
executive positions are kept under direct control of the central agency.
iii. Pay and Compensation

Modern bureaucracies are founded on the premise that individuals who work in them serve the
public good as opposed to catering to personal interests. This presupposes a basic income that will
allow public servants to carry out their duties without succumbing to extraneous pressures. Pay
reform aims at achieving improvements in fiscal balance, efficiency and accountability. The fiscal
objective often implies pay reductions, for instance by reducing the wage bill. However, other
objectives, including those of efficiency, may imply pay increases in the attempts to increase real
wages for lower-level staff and relate pay to performance.
Poor pay and compensation regimes due, among other things, to overstaffing lead to low
motivation, corruption, loss of qualified staff, poor services in remote areas, and undermine
investments in training. There are four main issues with pay and compensation, all of which derive
in large part from efforts to contain the overall wage bill while at the same time implementing
reform programmes:
 Wages are too low – public sector staff in developing countries often face pay scales that at
best are barely sufficient to live off; are not competitive with the private sector; or do not
compensate for postings to remote locations.
 Wages are compressed – wages of senior personnel do not reflect their skills, training, and
seniority. In Zambia, for example, permanent secretaries were paid only 5 or 6 times the
lowest employee wage.
 Non-monetary compensation and allowances play a major role in total compensation –
benefits such as housing allowances, official cars, pensions, and other retirement benefits
often form a large part of total compensation. In some developing countries systems of
monetary pay have collapsed and alternative rewards systems taken over, but these create
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opaque and arbitrary systems of compensation that make wage bills difficult to monitor,
manage and contain.
 Distortions created by varying donor practices on salary supplements.
Owing to this, pay and grading reform measures have been at the forefront of pay and employment
measures. Pay and grading reforms generally has five objectives:
 An increase in overall real pay levels;
 The decompression of pay scales to improve the competitiveness of civil service pay at
higher levels;
 A new grading system based on job evaluations;
 The introduction of performance-based pay; and
 The improvement of pay policy-making and administration
The World Bank and other agencies have tried to link the policy of wage decompression to
reduction of expenditure in order to encourage governments to pay living wages to a smaller
number of public employees who will remain in the service, as well as offer attractive salaries to
senior officials. Bangura (2000) has reported how this policy has been pursued in a few African
countries, including Ghana and Uganda. In these countries, government has made a strong
commitment to get out of the low wage-corruption, low morale-low performance-trap that has
bedeviled their public services. Massive retrenchments have been carried out and compensation and
redundancy benefits have been offered.
There are reports that many countries, including the Gambia and Guinea, have made considerable
progress in simplifying their grading structures. This, in turn, has acted as a magnet to attract and
motivate some top professionals including those with scarce skills such as physicians and
accountants. The reality in Africa, however, is that even in countries that have made tremendous
efforts to restore living wages in their public services, there remains the problem of paying
competitive wages that will retain or attract the best staff. Despite reforms, salaries are still much
too low in many African public services to retain professional staff, which has contributed to the
―brain drain‖ that Africa has been experiencing since independence. Significant increases in
salaries to attract and retain well-skilled staff may affect resources for other service delivery inputs.
How to improve public sector pay and the quantity of other inputs that are essential for efficient
service delivery is a challenge that low-income countries in Africa need to confront in their reform
program.
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iv. Performance Management: Merit, Promotion and Tenure

A central part of merit-based systems is a framework of performance evaluation, and rewards for
good performers. In practice, almost all performance management systems are costly to administer.
Traditional appraisals have tended to be closed to the employee in question, and feed-back is
limited, with a negative effect on motivation. More recent approaches have stressed focusing on
results rather than personal traits, on viewing appraisals as a developmental tool, and on
participative appraisals. Open performance appraisal systems relate individual performance to
organizational goals, test competence, and contribute towards a climate of open discussion within
the public service.
Performance Management is one of the various NPM-inspired measures to address some of the
accountability problems in the civil service. In pursuit of the goal of performance improvement,
performance management advocates for the ―empowerment‖ of managers, i.e., vesting the public
manager with the power and authority s/he needs to serve the citizen, and strengthen the links
between government and its diverse clientele in civil society. Underlying the empowerment
premise is the assumption that the power or authority that is ―delegated‖ to the average manager
would not only be shared with the subordinates, but would also be exercised for the public good
(Hope, 2001). This is assumed to increase efficiency, based on the notion that public sector
managers are hampered by rules and regulations, and have few incentives to take risks and to be
innovative and service-oriented.
Performance management is also expected to increase accountability because clear and explicit
managerial targets, combined with managerial autonomy and incentives to perform, make it easier
to establish the basis for managerial accountability and to achieve outputs. Further, according to
Therkildsen (2001), this in turn increases political accountability by making it easier for managers
to match targets with political priorities. Politicians can, in turn, hold managers accountable for
their performance, and performance targets can make service provision more transparent to
customers.
According to this line of reasoning, increased transparency and explicit performance targets are
further steps toward better democratic control and accountability of the bureaucracy. It is a means
of getting results from individuals, teams and the organizations at large, and allows for the
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development of indicators against which performance can be later measured. Performance

management systems are currently in place in Botswana, Ghana, South Africa and Uganda.
Performance contracts or agreements specify standards of performance or quantifiable targets

which a government requires public officials or the management of public agencies or ministries to
meet over a stated period of time. As part of the performance orientation in government, the
common purposes of performance contracting are to clarify the objectives of service organizations
and their relationship with government, and to facilitate performance evaluation based on results
instead of conformity with bureaucratic rules and regulations. The setting of specific performance
targets, in a format that can be monitored, is intended to provide a basis for evaluating performance
and improving accountability in the public enterprise sector. This illustrates the shift in emphasis
from the input and procedure-oriented controls of the past to the new paradigm of output or results-
oriented controls.
In line with the new institutionalist perspective in PSM reforms, as reflected in public choice
theories, and in the policy, prescriptions based on them, performance contracting between
governments and public enterprises (PEs) is increasingly being applied as an instrument for
restructuring PEs and for managing the Government-PE interface. Underlying performance
contracting, and in line with NPM, is the belief that while granting PE management operational
autonomy, there is a need to hold it accountable for performance.
In little more than a decade, Ghana has transformed the structure and strategy of its rural water
supply sector. By 2000, district assemblies and communities played a significant role in planning
supplies. The new policy and structure have attracted extra funds, and accelerated the work. This
reform process started with an extended dialogue with the major stakeholders in the sector, out of
which a new rural water and sanitation policy was developed. The policy was then implemented in
several large pilot projects, supported by a number of external agencies, and finally the lessons
from those projects were incorporated into the national programme itself. The success of this
approach was due to the fact that national and international NGOs were contracted to build the
capacity of local-level NGOs and CSOs. The Community Water Supply Agency (CWSA) was
created as a facilitating agency rather than an implementer. CWSA, as a semi-autonomous public-
sector agency, signs an annual performance contract with the State Enterprise Commission. It is
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committed to staying efficient and lean, below 200 staff, and highly decentralized to its ten regional
offices.
Whilst there have been some constraints on the capacity to implement performance contracting in
public enterprises in Africa, the World Bank has approved performance contracts as one of the
principal measures of reform for PEs, and the system has been adopted in a number of African
countries including Nigeria, Ghana and the Gambia.
v. Politicization and Patronage
Civil service reform efforts around the world, to various extents, have all stressed the need for
increased de-politicization of the civil service, promoting the ideal of a neutral and merit-based
civil service. Evidence shows however that pure merit-based systems are the exception and that
political appointments are common in most civil services. Those in favor of a patronage system
argue that it allows for the establishment of a cadre of loyal and efficient civil servants. It also
enhances democracy, as it enables the regular rotation of senior staff in accordance with the will of
the people. Those in favor of the merit system argue that it complies better with a rights-based
approach to civil service management (non-discrimination and equality of access to public office)
and that it allows for continuity and neutrality in the public administration.
A more realistic policy line takes into consideration the pros and cons of both the merit system and
the patronage system, in a given political and socio-economic context. In general, patronage should
be exceptional and restricted by means of efficient checks and balances that limit the discretionary
powers of politicians over recruitments and promotions. Therefore, patronage in the civil service
should be linked to merit selections, embedded in a strong ethical framework and counterbalanced
by an effective system of checks and balances. The following elements ensure that this is achieved:
 Identification and publication of the complete list of positions that are considered political
in nature.
 Clear procedures for recruitment and promotion, ensuring transparency in the selection
process and inclusion of formal checks and balances and appeals in the case of arbitrary
action.
 Restricted discretionary powers of politicians over selection processes (short-listing of
candidates should be the sole responsibility of a pluralistic selection panel)
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 A code of conduct that stresses the political neutrality and loyalty of the civil servants (i.e.
they commit to execute and support the policies of the government in place).
 Constitutional and legal guarantees (Civil Service Act) stressing the right of candidates for
(non-political) public employment, not to be discriminated against because of their sex,
ethnic origin, political, economic, religious, philosophical, cultural or social opinions or
conditions.
4.1.3 Experiences with CSR Reform in Developing Countries
There are few studies that compare developing and transition country implementation of CSA
reform in recent years. Some reform initiatives in those countries have tried to implement different
elements of NPM with varying degrees of failure and success.
4.1.3.1 Causes of Reform

Most authors agree that the factors that have driven reform in developing countries include one or
more of the following: fiscal crisis and excess staffing, dissatisfaction with government services,
declining confidence in government and citizens demands for changes in the government, growing
international competition, the presence of new reform ideas – most notably NPM – revolutionary
developments in Information technology, concern with patronage and corruption, low qualifications
of personnel, low salaries, and weak management systems. Studies of transition countries confirm
the obvious pressure for reform created by the collapse of authoritarian regimes starting in 1989.
External pressures from donors, especially in Africa, European Union, in the case of transition
countries, should be added to the list of causal agents.
In view of the diversity of factors and the many differences among countries in this category, it is
not surprising that there is no consensus by scholars on the relative importance of each of these
reasons across countries and regions. At the same time, it is evident that many of the above-
mentioned factors, whether once-over (like changes of regime) or continuous (like information
technology, international competition and the growing power of public opinion), are exogenous
sources of pressure for reform agendas to which governments are responding with varying degrees
of enthusiasm.
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4.1.3.2 Objectives of CSR

Some of these developing and transition countries have attempted to introduce various elements of
NPM over the last number of years, while others have pursued a mixed strategy in which there are
elements of the basic model (Weberian) and NPM. As noted in section above, a number of writers
have categorized three reform objectives: affordability, improved performance, and accountability.
And as country context has become increasingly important for the design of reform, expectations
and performance measures, diagnosis, and the package of specific reform proposals all differ to
quite a degree as a result.
The introduction of NPM has been urged, in many cases, by international organizations. There are
some critics regarding the role of these organizations in influencing the reform agenda of these
countries. For some authors, like Ingraham, there has been an imposition of ―western reform
models as a condition of international aid.‖
4.1.3.3 Implementation and Results

Scholars agree that CSR reform efforts in developing and transition countries over the last 20 years
have been difficult to implement and sustain over time, and that those difficulties probably explain
the high incidence of failure. But there are differing explanations on the reasons behind these
difficulties. Some reasons are related to the political process behind CSR reform implementation.
CSR reform implementation threatens the status quo and alters the balance of power within society.
It creates winners and losers within and outside the civil service. As Schneider and Heredia point
out ―CSR appears to be the one [public sector reform] most difficult to implement and
institutionalize‖. The difficulty arises from the loss of power and influence politicians face as they
move from discretionary to merit-based management. But this difficulty is increased by the
technical and administrative complexities embedded in designing and managing a merit-based
personnel system. In many developing countries, there is no technical and managerial capacity
within the civil service to manage that system and there may not be other supporting organizational
arrangements that make implementation of CSR reform more feasible.
Other scholars argue that implementation difficulties and lack of sustainability of CSR reform
interventions in developing countries arise from CSR reform designs. Designs that either use a
single template to address highly heterogeneous institutional settings or introduce recent OECD
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managerial models that may not be suitable. This opens the question on how much of the OECD
recent managerial reform experience could be transferred and be suitable for developing countries.
There is considerable debate on the issue of transferability, and particularly on NPM applicability
and suitability, for developing countries. Some scholars caution against directly transferring
managerialist models to developing countries, pointing out the risks of misdiagnosing the problem.
In countries where patronage and informality still dominate, managerialism may not be the most
suitable solution.
4.1.3.4Civil Service Reform in Ethiopia

Spanning over a decade, Ethiopia‘s transformation agenda has evolved over three phases (1991,
1996-2003 and 2003 onwards) in response to a growing awareness that pervasive deficits in
capacity have hampered the ability of the state to secure the fundamentals of poverty reduction and
democratic development including responsive service delivery, citizen empowerment, and good
governance (Ministry of Capacity Building, 2004). However, the first reforms phase in the early
days of EPRDF rule was politically motivated by aiming to root out an entrenched but ‗articulate
section of the national elite‘ that remained from the Dergue regime.
Following the consolidation of power, the Government also acknowledged the deep institutional
constraints on basic functions such as policymaking, service delivery, and regulation. Core public
management systems at the federal and regional levels were hampered by outdated civil service
legislation and working systems; the absence of a medium-term planning and budgeting
framework; ineffective financial and personnel management controls; inadequate civil service
wages and inappropriate grading systems; poor capacity for strategic and cabinet-level decision-
making; and insufficient focus on modern managerial approaches to service delivery.
In recognition of these constraints, the Government embarked on a comprehensive Civil Service

Reform Program (CSRP) in 1996, marking the second reform phase. Indicative of Ethiopia‘s ―first
generation‖ capacity building efforts, the CSRP sought to build a fair, transparent, efficient,
effective, and ethical civil service primarily by creating enabling legislation, developing operating
systems, and training staff in five key areas: (i) Top Management Systems, (ii) Human Resource
Management, (iii) Public Service Delivery Reform, (iv), Expenditure Control and Management and
(v) Civil Service Ethics.
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Successful efforts (for example, budgeting, planning, and accounting reforms) at the federal level
were intended to provide prototypes for regional authorities. The CSRP was also influenced by the
international New Public Management trend and reforms in New Zealand in particular. The CSRP
also faced some delays due to the Ethio-Eritrea border conflict 1998-2000. However, some
achievements which may pave the way for full implementation of the CSRP were witnessed.
Among other things, the development of new legislation (for example, a financial management
proclamation, a civil service law, a code of ethics, complaints-handling procedures, and a service
delivery policy) as well as operating systems for budgeting, procurement, and some aspects of
personnel management such as salary surveys and records management.
The most recent reform phase began in September 2001, with the launch of the Public Sector
Capacity Building Support Program (PSCAP), which also revived the CSRP. The Government has
moved quickly to prepare the CSRP for its ―full implementation‖ across all regions and levels of
government. Pilot studies and special programs on performance and service delivery improvements
in selected Ministries, Agencies, and Bureaus have been initiated. These include; the establishment
of focal points responsible for reform implementation across tiers of government; a series of
workshops undertaken to sensitize the political leadership and civil servants across the country; and
the launch of a ―special program‖ of Performance and Service Delivery Improvement Policy (PSIP)
in priority Ministries, Agencies, and Bureaus designed to deepen the implementation of
performance management. PSIP, along with other reform programme areas, have promoted
Business Process Reengineering (BPR) as a key management initiative, particularly in those
ministries that interface directly with the private sector. However, recently the perception is that the
CSRP in general is losing momentum, and following an appraisal of PSCAP, the following
challenges remained including inefficiencies derived from poor financial management, poor
incentives and a lack of strategic or performance orientation across all levels of government.
Therefore, in the light of the CSRP and other reform programs included in the package of SAPs,
the Ministry of Capacity Building reformulated the following objectives for the CSRP in June
2003:
 To shake off basic weaknesses ingrained in the existing Civil Service inherited from the past
regime
 To build the capacity of the Civil Service so that it will execute the policies and programs of
the government successfully
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 To facilitate the Civil Service to provide efficient and fair services to the public
 To enhance transparency and accountability in the Civil Service
 To build a Civil Service that stands for gender and ethnic equality and rights
 To build a Civil Service that is ethically sound and free of corruption, nepotism, and favoritism
Although these objectives enjoy broad support in the country, the challenge is whether the
government is capable of bringing about the envisaged changed in the system. There are doubts
about the environmental readiness, political commitment, and that the required level of technical
expertise is in place to institute the change.
Ethiopia‘s CSR is an ambitious programme that would tax the capabilities of any developed or
developing government. The strategy document of the reform is an impressive blueprint for broad
transformation. Whether the reform is too ambitious depends on how implementation is sequenced.
Institutional capacity, particularly in relation to human resource development, remains a major
obstacle to reform in Ethiopia. According to Gebriel (2002), of the 300,000-plus civil servants, less
than 17% held a college diploma and the majority of these were concentrated in major cities such as
Addis Ababa. The creation of an enabling environment for the reform is one of the demanding tasks
of acquiring the resources to build the technical capabilities and to develop human resources. As in
the case of most African countries, a consortium of donors, coordinated by the World Bank, have
extended loans to finance the PSCAP, which has the following objectives:
 To improve the scale, efficiency, and responsiveness of public service delivery at the
Federal, regional, and local level;
 Empower citizens to participate more effectively in shaping their own development; and
 Promote good governance and accountability (Ministry of Capacity Building, 2004: 8).
Clearly, to attain these objectives requires changes in bureaucratic values. The current lack of
capacity presents a severe, fundamental governance challenge for Ethiopia‘. However, reforms are
sweeping through public administration in Ethiopia.
Section Two:
4.2 Reform of the Machinery of Government
4.2.1 Decentralization
Dear learners, you have a great deal of clue about decentralization since you grasped the concept
through other modules. However, in this Part the discussion will focus on decentralization as a
dynamic component of public sector reform in constructing the New Public Administration (NPA).
In lieu of this, the section specifically focuses on the objectives of decentralization and tries to
show dimensions of decentralized management. Moreover, it tries to show how decentralization is
viewed in the context of the NPA.
One of the central elements in the changing role of the public sector and the construct of the New
Public Administration (NPA) is the concept of decentralization. Decentralization refers to the
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transfer of authority or responsibility for decision-making, planning, management, or resource

allocation from the central government to its field units, district administrative units, local
government, regional or functional authorities, semi-autonomous public authorities, parastatal
organizations, private entities and non-governmental private voluntary organizations. Highly
centralized forms of governance have been blamed for the generation of administrative pathologies
including communication overload, response times, filtering and distortion of information, a failure
to grasp spatial connections in sectoral programming, and so on. Moreover, centralized states tend
to be unresponsive to local needs as well as the needs of the disempowered in particular.
According to Borins 1994, Hope 2002, and Silverman 1992, within the context of the NPA,
decentralization is seen as the means for:
 Governments to provide high-quality services that citizens value;
 Increasing managerial autonomy, particularly by reducing central administrative controls;
 Demanding, measuring, and rewarding both organizational and individual performance;
 Enabling managers to acquire human and technological resources to meet performance
targets;
 Creating a receptiveness to competition and an open-mindedness about which public
purposes should be performed by public servants as opposed to the private sector;
 Empowering citizens through their enhanced participation in decision-making and
development planning and management;
 Improving economic and managerial efficiency or effectiveness;
 Enhancing better governance
Decentralizing management is a strand of NPM derived from ―managerialism‖ which is part of an

effort to ―de bureaucratize‖ and ―delayer‖ the hierarchies within the public service. The key
concern is to give managers the freedom to manage their units in order to achieve the most efficient
output.
The five main dimensions to decentralized management are:
1. Breaking up of monolithic bureaucracies into autonomous agencies (agentification): The

first and key trend is that, traditionally, monolithic public bureaucracies are downsizing,
contracting out functions and breaking up into more autonomous business units or agencies.
This is often called agentification. Downsizing arises from the concern for the size and cost of
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public-sector employment, which has not only contributed to the growing fiscal crisis and
budget deficits, but also depressed real wages and maintenance in capital budgets. Like in the
private sector, governments around the world have responded by putting limits on the size and
cost of the public sector. Ghana and Uganda, for example, have experienced massive cuts in the
size of their civil services, in the case of the former by almost half, and the latter by almost 40
per cent since 1987. The Zimbabwean civil service has also been cut by about 12 per cent since
the commencement of civil service reform in 1991.
2. Devolution of budgets and financial controls: Agentification requires the devolution of
budgets to give managers increased control through which they are held responsible through
performance targets. In principle, these agencies have greater managerial flexibility in the
allocation of human resources (including the right to hire and fire) in return for greater
accountability for results. In Ghana and Uganda, the Customs and Excise, and Internal Revenue
Departments were hived off from the civil service to form separate agencies in the 1980s. The
aim was to separate executive functions from policy-making and free managers from civil
service rules and conditions as well as offering them better incentives linked to performance.
3. Development of quasi-markets: The development of quasi-markets in public sector
transactions is a key feature of agentification. In quasi-markets, non-profit organizations
compete with profit-oriented ones for public contracts, and require a separation of production
and provisioning functions of departments, i.e., the central policy units may be entrusted with
the provisioning and the executive agencies with production. The objective of this dimension of
decentralized management is to divorce the provision from the production of public services.
4. Separation of provision and provisioning functions: The separation of provision from
production implies making a distinction (organizational and financial) between defining the
need for paying for public services and actually producing those services. The decentralization
of the decision-making process from Uganda Wildlife Authority headquarters to the field
empowered the previously disenfranchised field-based staff and allowed some autonomy for
each protected area in terms of the development of management plans, the disbursement of
funds against annual operating plan and the evaluation of the revenue generating potential of
each Protected Area. Adaptive management provides an effective means for mitigating risks.
Project experience, as well as various Quality Assurance Group reviews, showed that many
correct — if unpopular or risky decisions could be implemented effectively if there is strong
management support for them.
5. Adoption of new forms of corporate governance: The final dimension of management
decentralization is the adoption of new forms of corporate governance and the board of
director‘s model, which aims to reduce the power of elected representatives and minimize the
influence of labour unions on management.
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Decentralization is therefore crucial to the institutional reforms of Africa‘s public sectors and
represents a major element in the reconstruction of the public sector and the construct of the NPM.
Indeed, decentralization falls neatly into the neo-liberal logic of divesting the central state of many
of its responsibilities and encouraging the growth of market forces. Decentralization also
constitutes a central pillar of the demands for restructuring the African State along more
distributional lines. It has been used especially in countries that have been troubled by ethnic
conflicts – such as Ethiopia, Mali, Nigeria, Senegal and Uganda. Since decentralization is seen as a
basic problem of management or public administration, donors have been less inhibited in
intervening in this area than in democratization or other governance reforms that are perceived to
be much more political.
Closely related to decentralized management is the concept of ‗subsidiarity‟. Subsidiarity is the
principle of devolving political decisions to the lowest practical level. It is a principle of
management based on sharing authority, responsibility and provisions for more efficiency in the
production and management of resources and services. Subsidiarity differs from ―devolution‖ or
―delegation‖, in that the power originally rests with the smaller, lower and more regional entities,
and is delegated ―upwards‖ at the discretion of the latter, and not at the discretion of the central
authority. It implies a kind of reverse delegation, namely a delegation of power from the outside to
the centre.
Benin‘s national agricultural research was re-organized so that decisions would be made at the
regional level. Since 1997, the regional program‘s priority setting for development-oriented
agricultural research uses a bottom-up approach (i.e. from the local level to the regional, national
and sub-regional (West Africa). The subsidiarity process is based on different interfaces (local
committees, two regional committees, and a national committee) and it facilitates dialogue between
research, various users and clients. In order for subsidiarity to succeed the interfaces must be
effective and sustainable. Using this bottom-up approach, Benin‘s agricultural research has made
progress in research management, scientific cooperation, fundraising and research implementation.
4.2.2 Privatization
Privatization, or the transfer of State assets to the private sector, is a central component of
downsizing. It refers to the transfer of control and responsibilities for government functions and
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services to the private sector – private voluntary organizations or private enterprises. Privatization
in Africa has taken several forms. It has included:
 Commercializing of government services which are contracted out to an outside agency;
 Joint ventures between government agencies/ministries and private entities;
 Sale of some government services or functions, such as water supply or telecommunications, to
the private sector;
 Management contracts for the private sector to manage specific government functions or
services such as postal services;
 leasing of government assets that are used to provide public services;
 Granting of concessions to private entities to operate and finance public services delivery in
part.
Privatization, it is argued, can contribute to fiscal stability in a number of ways. Gains can be made
on the expenditure side by withdrawing subsidies to loss-making companies and imposing hard
budget constraints on the economic decisions of managers. Also, the revenue derived from selling
state enterprises to the public can help governments close their fiscal gaps.
4.2.2.1 Commercialization
Despite the growing interest in privatization, it is clear that Public Enterprises will continue to
feature prominently in the organizational landscapes of developing countries. It is therefore
important to be able to improve their performance. Commercialization is a technique of managing
public enterprises (PEs) or state-owned enterprises (SOEs) to make them profitable. In many public
enterprises, performance problems arise primarily from insufficient autonomy and authority for
managers at the level of the firm, particularly in relation to pricing, procurement, staffing,
performance management, and marketing; and from the State‘s unwillingness to create owners who
can protect the capital employed. By using the market-based solution, PEs becomes more like
private enterprises by placing a stronger emphasis on profitability as the major criterion of
performance. They are empowered with greater managerial flexibility in resources management,
better pay and greater accountability for results.
Market-based approaches to enterprise reform might entail some combination of the following
measures to shift power away from State bureaus to the portfolio management agencies, banks, and
boards of directors:
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 Transforming the enterprise into a profit-maximizing commercial entity and having this
policy communicated unequivocally by the owners;
 Imposing strict budgetary constraints;
 Terminating government subsidies to the enterprise;
 Appraising and rewarding the performance of individuals and groups in relation to their
achievement of organizational goals; and
 Assigning enterprise management, the power to hire and fire workers and evaluate their
performance, set product prices, and decide on product lines and output.
4.2.2.2 Contracting Out

―Contracting out‖ refers to the out-sourcing or buying in of goods and services from external
sources instead of providing such services in-house. It is a method of privatization that is increasing
in popularity due to the emphasis on efficiency and service delivery. Contracting may be between a
public organization and a private-sector firm or between one public organization and another.
The responsibility of the public organization is to specify what is wanted and let the private or
voluntary sector provide it. Contracting out, it is assumed, leads to cost savings from inefficient
public bureaucracies that are more intent on satisfying the wishes of producer groups than of
consumers. Moreover, private contractors can be penalized for poor quality, delays and lack of
reliability.
In Africa, there have been considerable efforts, in recent years, to extend the scope of its
application to a wider range of public organizations and activities than before. Hope (2002) reports
how in Botswana, parastatals have contracted out a number of services, including those related to
maintenance and security. Similarly, in Zimbabwe, non-clinical health services such as cleaning,
laundry, catering, security, maintenance and billing are contracted out, while clinical services are
contracted out on a limited scale.
4.3 Reforms Aimed at Improving Public Service Delivery

4.3.1 Total Quality Management (TQM)
Total Quality Management (TQM) is a management technique that emphasizes high-quality service
(Performance-Oriented Civil Service) and customer satisfaction (Customer-Driven Government).
TQM entails the constant improvement of product or service quality and reliability, combined with
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shorter and more reliable response times through the production and sales chain or service-
provision process. It also involves increasing flexibility of response to customer requirements and a
constant concern about efficiency through waste elimination, the removal of duplication of effort,
and curtailing overlaps of roles and responsibilities. The Key issues in TQM are:
A. Performance-Oriented Civil Service
One solution that has been proffered for the problems of inadequate resources and the increasing
demand for effective services, low levels of public trust, and increasing demand for accountability
in government, is termed performance oriented civil service. Performance-based management
requires that managers develop a reasonable level of agreement on program goals and strategies for
achieving these goals. Managers should develop performance measurement systems to document
performance and support decision-making. This performance information is then used for
managing the organizations and program and also for providing feedback to key stakeholders on
improved performance.
The key components of performance-based management are:
 Developing a reasonable level of agreement on mission, goals and strategies for achieving
the goals;
 Implementing performance measurement systems of sufficient quality to document
performance and support decision-making; and
 Using performance information as a basis for decision- making at various organizational
levels
B. Customer-Driven Government
In applying TQM, the organization should focus on what the population (customers) want, not what
administration thinks they need. To improve efficiency, productivity and integrity in the public
service, efforts should be primarily focused on creating a culture of commitment to identifying and
meeting customer requirements throughout organizations and within available resources. It follows
that serving the customer is more important than serving the organization.
This strategy has been the main focus of reforms in Malaysia, Namibia, Singapore and the United
Kingdom. The Malaysian Government has emphasized throughout the public service that the
customer is paramount. The Citizens Charter (United Kingdom) provides specific targets such as
hospital waiting times and train delays. Customer-driven government became formal policy in the
USA in 1993 through the National Performance Review (NPR) report. The Clinton Administration
used the NPR report to set a goal of ―providing customer services equal to the best in business‖.
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Mauritius also designed Citizens Charter as an aid to increasing popular awareness of corruption.
The main objective was to devise and disseminate a document with guidelines that individuals can
follow to prevent corruption and promote integrity. The Charter also attempts to inform and advise
the general public on the nature and forms of corruption. Central to the premise of the Charter is the
imperative of making the general populace aware of its collective and individual responsibility to
fight corruption.
C. Quality and Standards
Public sector management reforms would be incomplete without addressing the issue of the quality
of products delivered to the consumers. The private sector, as the engine of growth, cannot provide
satisfactory services and products without the active participation of a public sector that controls
quality and standards. An example of a standards authority in Africa is the Quality and Standards
Authority of Ethiopia (QSAE). QSAE was established in 1970 to promote quality management
practices as one of its central objectives. In addition to standards development, certification,
metrology and testing, the vision of the organization is to be an internationally recognized quality,
standards, metrology and testing organization that supports the national effort towards economic
development and social progress. The Authority has a quality policy, which is committed to
continuously satisfying the needs and expectations of its customers in a process of continuous
improvement.
4.3.2 Business Process Reengineering (BPR)

Business process reengineering (BPR) began as a private sector technique to help organizations
fundamentally rethink how they do their work in order to dramatically improve customer service,
cut operational costs, and become world-class competitors. A key stimulus for reengineering has
been the continuing development and deployment of sophisticated information systems and
networks. The BPR method is the fundamental reconsideration and radical redesign of
organizational processes in order to achieve drastic improvement of current performance in cost,
services and speed. Their claim was simple: most of the work being done does not add any value
for customers, and this work should be removed, not accelerated through automation. Instead,
companies should reconsider their processes in order to maximize customer value, while
minimizing the consumption of resources required for delivering their product or service.
Davenport (1992) prescribes a five-step approach to the Business Process Reengineering model:
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1. Develop the business vision and process objectives: The BPR method is driven by a
business vision which implies specific business objectives such as cost reduction, time
reduction, output quality improvement.
2. Identify the business processes to be redesigned: most firms use the 'high impact' approach
that focuses on the most important processes or those that conflict most with the business
vision. A lesser number of firms use the 'exhaustive approach' that attempts to identify all the
processes within an organization and then prioritize them in order of redesign urgency.
3. Understand and measure the existing processes: to avoid the repeating of old mistakes and
to provide a baseline for future improvements.
4. Identify IT levers: awareness of IT capabilities can and should influence BPR.
5. Design and build a prototype of the new process: the actual design should not be viewed as
the end of the BPR process. Rather, it should be viewed as a prototype, with successive
iterations. The metaphor of prototype aligns the Business Process Reengineering approach
with quick delivery of results, and the involvement and satisfaction of customers.
What exactly is BPR in Ethiopia? What concrete procedures are taken to restructure the
public sector?
As soon as the current government came to power, it started rigorous reforms (first phase reforms
from 1991 to 1995) in three fronts: Economic reform – from central planning to market economy;
Political reform – federalism, and power and fiscal decentralization; Constitutional reform –
enacting the Ethiopian constitution. The question was whether Ethiopia has a bureaucracy that is
capable of doing these reforms or not. The government employed private domestic and foreign
consultants to study the implementing capacity and effectiveness of the bureaucracy. The
consultants identified that Ethiopian bureaucracy is characterized by: very hierarchical with many
non-value adding works/positions/staffs; nepotism and lack of transparency and accountability, and
corruption; lack of leadership capacity; and input based and not output based – i.e. output not
measured.
It was difficult to undertake reform with this bureaucracy. The consultants recommended the
establishment of new institutions. The ―Ministry of Capacity Building‖ with the mandate of
undertaking reforms in all public institutions (esp. education and the civil service) was established.
Also ―Anti-corruption Commission‖ with the mandate of avoiding unaccountable and un-
transparent procedures in public institutions was established.
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Over time it was believed that an important condition to undertake the reforms was to implement
BPR. It was identified that to solve the problems of hierarchical bureaucracy with many non-value
adding works/staffs/positions, nepotism, etc; BPR is seriously implemented in all public institutions
gradually. The reason why the Ethiopian government adopted BPR is that the current system has to
be completely changed and redesigned and BPR can do this job.
Services delivered by the public institutions are characterized by long time taking, costly (high
transaction cost), incompetence (not up to the needs of customers), not responsive, (many
complaints, questions, comments etc., from customers but no response), not dynamic (the world is
changing but our public institutions are stagnant).
People have choices when they buy products from private firms. However, government services are
one (no choice). At the same time people have the right to get appropriate and satisfactory services
from public institutions. As a result of the implementation of BPR, painful practices in each public
office were identified, and many non-value adding works/positions are avoided. For example, it
was found that deputy head departments were actually doing nothing.
So far BPR is implemented in public offices and publicly owned big institutions such as ―the
Ethiopian Telecommunication Corporation‖, ―The Ethiopian Power Corporation‖ and government
banks. However, private firms have not adopted it yet in Ethiopia. The experiences of the Ministry
of Trade and Industry (MOTI), the Ethiopian Investment Commission, and the Ethiopian Customs
Authority are instructive examples of how institutions can be transformed to be more responsive,
efficient and effective. These three public institutions were taken as good examples in the IMF
Country Report No. 06/27 for Ethiopia (2006).
By way of highlighting the major achievements of the implementation of the Civil Service Reform
Program, the following are worth noting:
a) The Ethiopian Investment Commission: It used to take 18 steps and 25 days on average for an
individual business person to secure an investment license, whereas now after the conduct of
Business Process Reengineering (BPR) by the Commission it only takes an individual 4 steps
and 2 days to get his/her investment license. The same service used to take 39 steps and 108
days for a company whereas now (after BPR) it only takes 4 steps and 2 days. Securing main
registration certificates used to take 18 steps and 28 days for an individual businessperson before
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the BPR whereas now it only takes 4 steps and 2 days. The same service used to take 39 steps
and 96 days for a company, whereas now it takes the steps and time as the individual business to
secure registration certificates.
b) The Ministry of Trade and Industry (MOTI): It used to take 14 working steps (processes)
and two and a half days to secure a trade license for an individual business person whereas now
(after the Ministry conducted BPR), it now only takes a business person 6 work steps and 34
minutes to get a trade license. This same service used to take a company 26 working steps and
35 days. After the conduct of the BPR, it only takes the same work steps and time as an
individual business (6 work steps and 34 minutes, respectively).
c) The Ethiopian Custom Authority: Securing loading permits from Djibouti used to take 43
work steps (processes) and 2 days whereas after the Authority has been re-organized and
undertook BPR, it only takes 6 steps 15 minutes to get the service. Checking and fixing a
container with a customer seal used to take 8 steps and two days before the BPR, whereas now it
only takes 3 steps and 40 minutes to get the same service. Declaration acceptance, approval,
examination, release of exported items and distribution of declaration used to take 8 steps and 2
to 15 days, whereas now it only takes three steps and 26 minutes to get same service for a
business entity.
Building on some of the Progress made in the aforementioned organizations, the government is
aggressively implementing BPR in all public sector organizations throughout the country since
2008. While the reform is very much in vogue, it remains to be seen how much progress is
achieved.
4.3.3 Electronic-government (E-Government) Reforms

Information technology (IT) has been included as one of the key strategies for public service
reforms. It is now seen as an essential facilitator of service improvement particularly when
governments worldwide are facing an increasing trend towards knowledge-based production and
the communications revolution. Expenditures by governments on computers and management
information systems have risen rapidly in many countries and now represent major items in their
budgets.
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The creation of new information and communication systems are seen as an essential component
in the creation of accountability. When a decision is taken, information about that decision and its
outcomes must flow to all those to whom the decision maker is accountable and without such an
information flow, and without the information system to carry that flow, there can be no
accountability because there can be no knowledge of the decision. Whilst pursuing
democratic/political processes, in managing resources, executing functions, measuring performance
and in service delivery, information is the basic ingredient. Therefore, there is great potential for
these trends of information-age reform to bring significant benefits to Africa because government
has been, and still remains, the single largest collector, user, holder and producer of information.
Information is a central resource for all staff levels and for all activities. The work of government is
thus very information-intensive and four main types of formal information are identifiable:
1. Information to support internal management: This includes information about staff for
personnel management, and information about budgets and accounts for financial
management. Like the other three types of information, it can be used for everything from day-
to-day operational implementation to long-term policy analysis and planning.
2. Information to support public administration and regulation: This includes information that
records the details of the main ‗entities‘: people, business enterprises, buildings, land plots,
imports/exports, etc. It is used for a variety of purposes such as legal, judicial and fiscal.
3. Information to support public services: Examples include education (e.g., School staff
records), health (e.g., patient records), transport (e.g., passenger reservation information) and
public utilities (e.g., customer billing information).
4. Information made publicly available: Examples include press releases, consultation papers,
details of policies, laws and regulations, and details of benefits and entitlements.
Given this information-intensity, changes in information systems must be an essential part of all
reform initiatives in Africa, and changes in information technology will have a great potential in
efficiency and effectiveness gains in the public sector. In theory, everything that IT can do could be
done by some other means. However, in practice, its ability to increase the speed and/or reduce the
cost of information tasks means it can do things that would not otherwise be contemplated.
E-Government, whether seen as a component of NPM or an extension of NPM, should be seen to

encompass all ICTs in all activities of the public sector. The key innovation is computer networks
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and the three domains are e-Administration, e-Citizens, Services, and e-Society. There are a
growing number of e-government projects in Africa, some of which are contributing to public
sector reform and delivering efficiency gains in service delivery. E-Citizens and Services, for
example, deal particularly with the relationship between government and citizens: either as
voters/stakeholders from whom the African public sector should derive its legitimacy, or as
customers who consume public services. The key aims in this domain include providing citizens
with details of public sector activities; increasing the input of citizens into public sector decisions
and actions; and improving the services delivered to members of the public along dimensions such
as quality, convenience and cost.
For example, following difficulties in the 1994 elections, South Africa‘s independent Electoral
Commission was charged with making sure that the country‘s second democratic elections in 1999
were ―free and fair‖. This election was vitally important for the stability of the South African
political climate and for ensuring that democratic processes were solidly in place. Through large-
scale implementation of unique information technology application, information, education and
communication (IEC) was able to ensure that all South African citizens could have their voices
heard. The effort included the creation of a nationwide satellite-based wide-area network and
infrastructure; a bar-code system used to register 18.4 million voters in just nine days; a geographic
information system used to create voting districts; a national common voters‘ role; a sophisticated
election results center for managing the process; and the training of 300,000 people. The massive
program was completed in less than two years, in time for the vote. For this, the IEC received the
2000 Computer World Smithsonian Award for most outstanding program in government and non-
profit organizations category.
However, it must be noted that, in general terms, the diffusion of e-Government in Africa has been
slow. It is a fact that African governments have fewer e-government initiatives than industrialized
countries; make less use of ICTs in their work than industrialized countries; and use older
generations of technology than industrialized countries. A major explanation is financial. However,
there are also strategic challenges such as undeveloped telecommunication systems, networks, and
ineffective legal, human and institutional infrastructures that pose limitations on the ―e-readiness‖
of many African countries.
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4.3.4 Cost Recovery: User Fees and Charges

One of the major developments in the provision of public services has been the introduction of user
fees or charges. Charges to consumers for public utilities represent an attempt to diversify financing
for public services and reshape public spending. These policies have assumed increasing
importance in developing countries, especially in Africa, in the 1980s, as governments faced slower
economic growth and rising deficits that made public expenditure levels unsustainable. User fees
have been introduced at different levels of education in Ghana, Kenya, Malawi and Uganda, and in
other countries implementing SAPs (Structural Adjustment Programs).
In comparison to other developing regions, user fee reforms have been most extensive in sub-
Saharan Africa. This is because the gap between resources and needs, and the influence of
international donors, has perhaps been greatest in Africa. The key rationale of the introduction of
user fees in Africa, therefore, has been to raise additional revenue in the face of increasing demand
for services. User fees also serve to increase market discipline by preventing the over-use of
services by consumers apart from improving quality and fostering responsiveness to the needs of
consumers.
The objective of introducing user fees is cost sharing. Implementing such a policy is supposed to
help the poor because it mobilizes more resources from better-off groups that could then be used to
provide services for poorer groups. In Guinea-Bissau, for example, user fees in health care have
consistently contributed between 30 and 45 per cent of the operating costs of health services.
However, user fees are not without their problems. Good administrative and management systems
are needed to complement such a policy. There has been some evidence that the introduction of
user fees has made access to social services more difficult for the poor, especially in the initial
years of the scheme. Therefore, exemption systems and safety nets need to be designed so that user
fees fall mainly on services consumed by the non-poor. Such systems include ensuring that
information about incomes (on which to base exemption decisions) is collected in an effective
manner, especially for large numbers of people in the informal sector.
4.3.5 Public Reporting
Public Reporting on the financial performance of government agencies is an element of good
governance and financial accountability. It involves providing information on the financial and
managerial performance of public departments that enables the public to monitor and assess
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performance of government activities. The aim is to encourage dialogue so as to lead to improved

service delivery.
The International Monetary Fund (IMF) and other international bodies have developed a number of
codes and standards that set out ―good practices‖ in the areas of policy transparency, data
dissemination and financial regulation and supervision. In relation to public reporting, the IMF has
identified the following codes and standards:
 The public availability of information – the public should be provided with full information
on the past, current and projected fiscal activity of government;
 Open budget preparation, execution and reporting – budget documentation should specify
fiscal policy objectives, the macroeconomics framework, the policy basis for the budget, and
identifiable major fiscal risks;
 Budget data should be classified and presented in a way that facilitates policy analysis and
promotes accountability;
 Procedures for the execution and monitoring of approved expenditures should be clearly
specified; and
 Fiscal reporting should be timely, comprehensive and reliable, and should identify
deviations from the budget.
The Office of the Auditor-General also provides a critical link in the chain of public accountability,
a role that is both unique and vital to the democratic process of responsible government. The
Auditor-General‘s role is to assist the legislature in overseeing the management of public money,
by providing independent assessments of, and advice about, government accountability and
performance. Reports should provide assessments and also highlight issues requiring the attention
of the legislature or government, and should also contain recommendations that could assist
government organizations to improve their management and performance.
4.3.6 Citizens Charter

A key feature of the NPM is the concept of perceiving the citizen as a ―customer‖ of public
services. In the context of public sector reform, efforts to make public service agencies more
accountable to the public have included the adoption of Citizens Charters. Citizens should be
consulted about the level and quality of public services and, whenever possible, be given the choice
of services. Citizens should also be informed about the level and quality of services they will
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receive, and they should have equal access to the services to which they are entitled. Moreover,
they should be informed about how national departments and provincial administration are run,
how much they cost and who is in charge.
In 1991, the British government launched the Citizens Charter. It was designed to raise the standard
of public services and make them more responsive to their users and to encourage public servants
to think about what they do in relation to how it affects their customers. The Charter spells out a
number of key principles that every citizen is entitled to expect, including:
 The setting and publication of explicit standards for services and the publication of actual
performance against these standards;
 Information and openness about the provision of services; and
 The efficient and economical delivery of services within the resources the nation can afford.
In this regard, the Charter for the Public Service in Africa was adopted at the third Pan African
Conference of Ministers responsible for the Civil Service, in Windhoek, Namibia, in 2001. The
Charter highlights the need to adapt the different public services in Africa to the new requirements
of public service, to be able to anticipate or accompany the profound changes that African countries
are experiencing. It also takes into account the prevailing socio-economic conditions, including
globalization, and the need to create an enabling environment for private sector growth. The
Charter also defines a framework to guide the public services in Africa in taking such legislative,
regulatory, technical and practical measures as may be required to create the conditions for the
proper functioning of the public service and improve the quality of its services.
Fundamental Principles of the African Public Service Charter;

(i) Principle of Equality of Treatment: All public services shall recognize the equality of
citizens before the law and will not be discriminated against based on the place of origin,
race, gender, religion, ethnic group, philosophical or political convictions or other personal
considerations.
(ii) Principle of Neutrality: The public service that serves the interest of the public shall not
discriminate against its employees because of their personal traits. The public service shall
remain neutral in respect to the government of the day and this fundamental principle will be
respected by all administrations.
(iii)Principle of Legality: Public service shall be provided in strict compliance with the law.
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(iv) Principle of Continuity: Public service shall be provided on an ongoing basis and in all its
component parts, in accordance with the rules governing its operation. Failure to comply
with the principle of continuity may incur the liability of the administration in respect of any
person who might have suffered harm on account of such failure.
Citizens Charters exist in both South Africa and Zimbabwe. In Tanzania there are plans for
Ministries to publish ―social pacts‖ setting out the standard of services that the public can expect.
Launched in 1997, the Batho Pele-People First initiative in South Africa is based on a set of
national principles for public service. Ghana and Uganda have also shown good practices in
customer-oriented public service. In Ghana, the public service reform program is a sub-component
of the country‘s National Institutional Renewal Program and, amongst other areas, focuses on the
development of customer- service orientation, promotion of cost and time consciousness in the civil
service, and improvement of records and information management systems. The public service
reform program in Uganda has focused mainly on the transformation of public service
organizations with customer-oriented service delivery units. Substantial powers and resources have
been delegated to lower-level service delivery agents and also capacity-building programs have
been implemented that aim to introduce client-oriented attitudes in the public service.
4.3.7 Civil Society Organizations Reforms
The role of Civil Society Organizations (CSOs) and NGOs in the delivery of services to the public
is on the increase worldwide. In July 1999, African countries at the Assembly of Heads of State and
Government of the Organization of African Unity (OAU) adopted Resolution 1286 affirming the
value of popular participation in Africa‘s socio-economic recovery and transformation. CSOs,
including NGOs, professional organizations and women‘s groups, make a case for greater
cooperation between their activities and those of government and advocates for mutual acceptance
of legitimacy and strengths and weaknesses. NGOs and CSOs worldwide have been known to be
able to reach poor communities with social services, including health and education.
While it is appreciated that governments must value the energy and creativity that CSOs and NGOs
bring to the development arena, NGOs and CSOs on the other hand, need to be transparent in their
objectives to reduce government concerns about any subversive activities. Therefore, constant
dialogue between government and these organizations will reduce the mutual suspicion of each
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other‘s motives. It is also suggested that joint policies should be developed to define sectors of
society, the economy, and the environment in which civil society activity, either independently or
in cooperation with government, are encouraged. Paying more attention to CSOs may provide an
avenue for addressing, in particular, the social integration challenges of sustainable development
and the problems associated with the development of social capital. There is no doubt that the
cooperation between government and civil society would promote and implement people centered
and sustainable public service delivery reforms
Section Three:
4.4 Public Financial Management Reform
4.4.1 Financial Management Reform in Developing Countries
Starting in the 1950s, the financial management advice most sought by developing countries was
how to raise more revenue to finance the capital investments governments were seeking to make.
Much of the discussion focused on how to raise investment needed to achieve a target growth
rate building on the dominant thinking of the time of state-led development. On the expenditure
side, a host of challenges gained attention largely following the oil price shocks, where fiscal
deficits of developing countries increased from 3.5 percent to 6.3 percent of GNP during 1972-
85. These challenges included weak public expenditure and resource planning (e.g. weak
priorities and linkage with macroeconomic framework), inconsistent budget structures (e.g.
inconsistencies and weak links between capital and recurrent budgets), budget implementation
(e.g. weak cash management) and accounting and reporting (e.g. absence of commitment
accounting), and selective reforms to improve performance and allocation.
Toward the end of the 80s, there was a belief that centralized financial controls introduced during
the crisis needed to be replaced in many cases with decentralized controls at the spending unit
level, with greater integration of policy and financial considerations. This also linked with
greater citizen demand for improved service delivery and greater accountability for results
through contractual and other mechanisms. Countries also sought to reduce high, progressive
income taxes, import duties and export taxes and replace them, for example, with a value added
tax (VAT) that would help facilitate market directed allocation of resources, while being broadly
politically acceptable, and administratively feasible
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These demands from the developing world were a response in part to the recent thinking in
OECD countries on how to adapt new tools to carry out deliberate changes in the structure and
processes of the public sector to get them to run better. Development agencies also changed their
views over this period, increasingly realizing that deficient PFM systems can undermine their
development assistance. They realized that even though aid projects may have good financial
controls, they could result in government resources being freed up to fund other things; if PFM
systems were deficient, the development results from these resources were likely to be less than
desired. Donors became increasingly aware that the distinction between development and
recurrent spending was less important than once thought: teachers‘ salaries were just as
important as school construction for achieving education. They realized that project-centered aid
could not succeed with poor macroeconomic and fiscal policies, and that economic development
required not only physical investment, but also good public sector management.
There was increasing awareness that PFM outcomes depend on the nature of budgetary
institutions, and that sound PFM requires not only a strong budgetary authority, but also capable
a legislature, in some cases supported by civil society budget groups. There is some evidence of
recent increasing work by multilateral donors in these areas. At the same time, there is evidence
that countries with rules that establish limits on deficits, that prevent sub-national and
decentralized agencies to incur in debt financing, that have medium term fiscal frameworks and
reserve funds in place, and by more hierarchical procedures, that establish restrictions on the
legislature and on the bargaining power of ministers and provides the executive with discretion
to cash manage expenditures, tend to present lower primary general government deficits.
The next section will sketch out three broad debates carried out over the last two decades
relevant to these changes: first, the degree to which developed country public management tools
are transferable to developing countries; second, the role of governance assessment in the
transfer process; and third, the search for analytical frameworks for public financial
management. A final section will sketch out ongoing debates on some of the specific reforms
underway.
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4.4.1.1 Transferability of Ideas
There is a consensus in the literature that important differences between developing and
developed countries require that public financial management tools be used selectively, and
adapted to local conditions. Some of the key differences in context between developed and
developing countries are: First, the pace and nature of reforms in developed countries are
designed and carried out by the respective governments, and with the democratic support of their
electorates. By contrast, reforms in developing countries are often designed by international
agencies, and not fully understood or supported by citizens. In some cases, these reforms may be
carried out by bureaucratic and political elites with the intent of preserving their existing
interests, although the eventual outcome could be different. Secondly, common reform packages
designed to address fiscal crises in developed countries are being transferred to a highly diverse
set of countries, including transition economies, weak capacity and post-conflict states, post-
authoritarian democracies, and Confucian meritocracies. Many of these developing countries
have much deeper fiscal crises and sharper declines in public service than developed countries,
yet programs often used OECD country designs as models. Where programs vary, the reason is
often more failure to meet negotiated conditions, rather than differences in design. Thirdly,
implementation of reforms in developing countries is uneven, with stroke-of-the-pen reforms
often moving quickly, while necessary structural changes move slowly or not at all. In addition,
chronic institutional weaknesses in many developing countries hinder reform effectiveness. For
example, rivalries between planning and finance ministries lead to conflicts over fiscal goals,
poor communication, and decisions on personal appointments and projects overlooking technical
merit in favor of personal and political considerations. There are also considerable differences
among developing countries, even within the same region. In countries with weak capacity,
centralized management models provide the best starting point, since decentralized models
typically rely on complex financial reporting systems.
Another difference concerns election year increases in fiscal deficits. Although these occur in
both developed and developing countries, they are larger in developing countries because
potential rents are larger, and the proportion of informed voters in the electorate is lower. There
are also very different interpretations of words like public management, efficiency and
transparency when translated into different languages, even among people with common
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historical and cultural traditions. Some keywords from the reform toolkit, such as accountability,
have no equivalent in other languages (such as Spanish, Vietnamese, and Chinese in this case).
Many scholars stress the differences between formal, managerial budgeting in developing
countries, and the informal budgeting that actually takes place, responding to their poverty,
uncertainty, and differing political cultures. Many question transfers of Western models, drawing
the language, practices, and values from business to the public sector, to non-western societies.
4.4.1.2 Selected Priorities for Reform

Aside from broad debates on transferability of ideas there are specific debates on the reforms
themselves. Following developed country experience, there is some evidence of success in
developing countries with fiscal decentralization, providing more budgetary flexibility to
achieve efficiency and nation-building gains. Developed countries spend about twice the share of
total expenditure on sub-national governments than developing countries. Expenditure by sub-
national government is also higher in countries with large populations, and in transition
countries. The proportion of sub-national expenditure hasn't changed for the last 3 decades on
average because, inter alia, central governments want to hold on to major revenue instruments to
have flexibility in dealing with fiscal imbalances, infrastructure planning, construction and
maintenance is beyond the capacity of many local governments, the central government is in a
better position to address inequalities among regions, and officials from central ministries lobby
for keeping the status quo. However, there may be increase in sub-national expenditure
proportion in future because of popular demand, and increased understanding of possible
efficiency gains.
In another example, as developing countries draw from the menu of OECD accounting reforms,
there are differing views on the results. Improved cash accounting in Uganda and Zambia gave
better information on expenditures where capacity was too limited for a commitment-based
system. But the restriction on cash wasn't enough to solve the problem of excessive
commitments without the active involvement of the President (Uganda) and the IMF (Zambia).
Mongolia's attempt to adopt full accrual budgeting and accounting, output budgeting, devolution
of hiring to agency heads, and performance contracts wasn't based on careful diagnosis, and had
to be scaled back to a model more suitable for local conditions. A program underway to
implement modified accrual accounting at the treasury level, supported by adoption of
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international accounting standards and implementation of an IT-based budget and accounting

package is showing promise.
Accrual accounting supplements cash accounting systems to ensure that the financial information
available to management is current, and provides meaningful analysis of resource usage within a
department. The adoption of accruals is a significant and radical reform to the financial
management of governments.
These reforms aim to hold management responsible for outcomes and outputs whilst eliminating
controls on inputs. In this context, it is expected that managers should be responsible for all costs
associated with the outputs produced, not only the immediate outlays. Accruals allow for the
capture of these full costs, thereby supporting effective and efficient decision-making by
managers.
Similarly, there is continuing debate on the suitability of multiyear budgeting. Many developing
countries have followed the example of developed countries in adopting this reform, to help
achieve greater certainty on future funding. Despite concerns expressed earlier about achieving
transparency in multiyear budgeting, and challenges evident in developed countries in making
effective use of this tool, and the many added challenges facing developing countries, medium-
term expenditure frameworks are central features of the Poverty Reduction Strategy Paper
(PRSPs) and Poverty Reduction Support Credit (PRSCs) prepared in recent years. Craig and
Porter (2003) point out that aside from technical problems of using this tool effectively, its use
for upward accountability to central ministries and donors can undermine local political
legitimacy and accountability, sideline the role of legislatures, and cut off important sources of
local knowledge on what works and doesn't work in poverty reduction.
Financial management information technology (IT) systems have been successfully adopted in
some cases when there is sufficient commitment, capacity, and resources as part of a broad and
appropriately phased reform program. If conditions are right, there may be significant efficiency
gains. For example, e-procurement in South Korea, Brazil and Philippines has reportedly
improved efficiency and transparency, reduced acquisition cost, and may have reduced
corruption. Malaysia‘s e-Perolehan (2004) government procurement system is a build-operate-
transfer scheme led by a private company.
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In some parts of Africa, the principal benefit from IT may be ensure more systematic adherence
to financial rules by manual systems, which may be run in parallel to IT-based systems and more
relied on by finance staff. Successful IT-based financial systems reforms are commonly iterative
and modular rather than integrated, built around scarce, high quality public managers wherever
they may be working. On the other hand, in both developing and developed countries, the
expected benefits can be blocked by traditional bureaucratic forms, technical difficulties, lack of
skills, and weak project management.
Delays in IT adoption by governments stem from the nature of public sector financing and
procurement practices. To ensure accountability, government agencies need to go through a
lengthy process of securing funds, seeking competitive tenders, and awarding contracts. To
prevent undue influence by any one official, many decisions along the way are made by
committees, which can lead to compromises and an unclear focus. In addition, when acquisitions
are finally made, the technology has often moved far beyond where it was when the project was
first conceived; thus governments often install outdated systems. They also pay excessive prices,
since new products may have come into the market during this period that can deliver the same
ICT power for much less money. The difference between the outdated tender price and the
market price is also an arbitrage opportunity for corrupt officials. Capacity-building support in
this area is likely to be most effective if preceded by an understanding of how work gets done in
target organizations, including actual practices often very different from what may be indicated
in formal rules and regulations.
Developing countries have in many areas followed the OECD example of introducing market
mechanisms to improve performance and accountability. For example, countries have formed
autonomous tax administration agencies in an effort to separate policy making from
implementation, and to enhance incentives for the latter. Debate on the effectiveness of such
reforms continues, with analysts finding some cases leading to increased revenue collection, and
others leading to increased corruption. Countries also devolved budgets and financial control to
semi-autonomous agencies such as teaching, hospitals, water authorities, and semi-commercial
agricultural bodies. These led to performance improvements when the policy framework and
accountability framework was clear. However, such improvements were constrained in many
cases because of inadequate accounting systems, weak personnel management, unreformed
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financial administration regulations, unpredictable financial resources, and unclear authority

relationships between principals and agents
4.4.1.3 Cross-Cutting Debates
In concluding this brief survey of recent debates on financial management, transparency and
governance, there are two cross-cutting questions that can be raised: First, does more aid weaken
governance? Second, what should be the scope of reforms?
Aid can have the unintended consequence of weakening governance because governments can
raise significant financing without having to rely on increasing taxes; thus, they have less need to
provide a conducive business climate, and to provide accountability to their citizens (though they
may be held accountable by international donors). Aid can divert scarce skills from government,
encourage corruption and conflicts over control of aid funds, and reduce citizen demand for
reform. Aid can also weaken administrative effectiveness through high transaction costs, the
fragmentation and weak coordination of donor projects, the lack of integration in the budget
process, moral hazard, soft budget constraints, and unrestrained future claims on recurrent
budgets to maintain donor investments.
Using International Country Risk Guide (ICRG) governance data, Brautigam and Knack (2004)
found that aid dependence was linked with an increase in corruption, and worsening bureaucratic
quality and rule of law. They find a modest reduction in the negative effect of aid on governance
in Africa between the 1980s and 1990s, but the change isn't statistically significant. Yet, Tavares
(2003) uses a different methodology in analyzing ICRG data to argue that more aid may be
associated with less corruption, perhaps because donor rules constrain recipient government
officials, or because more aid helps to pay better salaries to officials.
Ear (2007) uses pooled, time series cross-sectional (panel data) analysis drawing on data in
Kaufmann et al. (2005) to confirm a negative effect of aid dependence on rule of law; but, unlike
Knack and others, he finds no significant negative effect on other aspects of governance. In
addition, he finds that components of aid have a statistically significant effect on rule of law
(negative effect from technical cooperation) and on voice and accountability (positive effect
from proportion of grant element). Resource-rich countries face similar challenges.
What should be the Scope of PFM Reforms
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There are continuing debates over whether reforms should be comprehensive in scope, taking a
―big bang‖ approach, or incremental and opportunistic. Some stress the need for a ―top down‖,
politically-driven, all-encompassing reform process to take advantage of narrow windows of
opportunity. Thus Werlin (1992: 204), citing the example of countries such as Korea, argues that
reforming central bureaucracies is primarily a problem of political will and government capacity
to effectively use persuasive and manipulative (rather than coercive and corrupting) forms of
power. Rodrik (1996) cites Polish macroeconomic reforms beginning in 1989 among others as
succeeding due to ―speed and stealth‖. Reforms in New Zealand between 1984 and 1990 (Pallot
1991) and in Canada in 1994 are cited as examples of comprehensive strategies that delivered
important results.
On the other hand, North (1990:89) views piecemeal reforms as more typical: The single most
important point about institutional change, which must be grasped if we are to begin to get a
handle on the subject, is that institutional change is overwhelmingly incremental‖. Esman
(1991:138-139) advocates a bottom up" approach. He claims that system-wide reforms disrupt
familiar routines and threaten established centers of powers without demonstrating convincingly
their effectiveness. He prescribes, instead, incremental, confidence-building measures, such as
training, new technologies (e.g., e-government), introduced with staff participation and focused
at the level of individual programs or organizations. Brautigam (1996) makes a related argument
that reforms should concentrate on a few critical functions, shifting politically important
patronage opportunities to less vital agencies.
Unit Five
Governance and Capacity Building Reforms
Section One:
Governance Reform
5.1 Governance and Governance Reform

One can distinguish a neutral definition of governance from its normative definition, although these
two sometimes overlap. The neutral and broader notion of governance is commonly used by
academics and some donors. It refers to the way authority or power is exercised, which
encompasses the environment, participants, rules, and processes of governing society.
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Participants of the governance process, in this view, include not only government (political and
administrative) institutions, but also private and societal institutions that all together influence how
society is governed. Governance thus connotes the idea that the government is no longer the sole
player in society, and that other interdependent private, non-profit, societal (community), and
international institutions and organizations share authority in making and implementing decisions
on public matters. Governance, thus, became a prominent concept which evolved from narrow
public sector management to encompass a broad range of related political issues such as corruption,
security, human rights, and the role of formal and informal institutions.
The emergence of this term reflects the changes in and the dynamics among the means of
exercising authority; it is a reaction to the trends associated with globalization and devolution as
well as economic liberalization and the reduction of the role of welfare state. These changes created
new opportunities and incentives, and altered previously stable power relationships organized
around governments‘ formal authority. The increasing turbulence brought in new types of
shareholders wanting to participate in decision-making (e.g., civil society organizations) at multiple
levels of government, ranging from local communities to relationships of global scale, thus
affecting the bargaining shares of the existing players.
This distinction between government and governance and the new role of government in the current
context is very important here. Government is the term conventionally used to refer to a formal
institutional structure with authoritative decision-making powers, Governance is used to refer to the
changing processes and practices of governing which involve multi-agency partnerships, a blurring
of responsibilities between public and non-public sectors, a power dependence between
organizations involved in collective action, the emergence of self-governing networks and the
development of new governmental tasks and tools.
The previous emphasis on government was also weakened with the realization that more self-
governance through decentralization and participation can enhance efficiency and mitigate the
growing costs of control. As a result, the traditional concept of government as a controlling and
regulating organization for society is argued to be outmoded. Instead, governance without
government is becoming a dominant pattern in industrial democracies under global and domestic
pressures from international capital markets, supranational organizations, the private sector, and
strengthened civil society and interest groups.
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Governance reform from this standpoint refers to a wholesale transformation of interdependent

political, administrative, as well as private, nonprofit, and even societal institutions. This term
conveys an understanding that institutions are interdependent and that reform need to account for
this reality. This, at a minimum, means that changing economic or political institutions alone will
not be sustainable unless public administration systems are also reformed.
The narrower and more normative definition of governance is commonly used by major donors,
such as the World Bank and United Nations; it refers to what governments should do. For example,
the World Bank defined governance as: The exercise of authority through formal and informal
traditions and institutions for the common good, thus encompassing: (1) the process of selecting,
monitoring, and replacing governments; (2) the capacity to formulate and implement sound policies
and deliver public services, and (3) the respect of citizens and the state for the institutions that
govern economic and social interactions among them. The UN Committee of Experts included in
governance ―public administration and civil service, rule of law, human rights, macroeconomic
policies and regulatory frameworks and transparent and participatory decision-making processes.
The normative definition overlaps with the term good governance. Good governance refers to a set
of idealized principles and guidelines for reforms that IDA draw from best practices of the OECD
countries‘ experiences and their own ideas of how governments should function. These principles
include:
 formal checks and balances, competition within civil service and among other institutions,
and contested elections
 rule of law, efficiency and accountability of the public sector, and tackling corruption
 policy making and allocation of resources based on consensus in society that accounts for
the voices of the poorest and the most vulnerable
 democratic accountability, fundamental freedoms, service delivery for all, due process
rights and security
 democratic governance; transparency, pluralism, citizen involvement in decision-making,
representation, and accountability and
 Rule of law, responsibility, openness, integrity, efficiency, accountability and transparency.
The World Bank‗s instrument to measure the quality of governance by the following six parameters
more or less captures the principles mentioned above: (1) voice and accountability to citizens, (2)
political stability and lack of violence, crime, and terrorism, (3) government effectiveness, (4) lack
of regulatory burden, (5) the rule of law, and (6) control of corruption.
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From this standpoint the purpose of institutional reforms, which are sometimes called governance
reforms, is to establish the way of governing that follows good governance principles. Developing
countries are advised to reform their institutions to exercise good governance aligned with these
principles and, as a result, secure economic, political, and social development. As mentioned
above, in this wave of institutional reforms, good governance is treated both as the means and ends
of development.
5.2 Approaches to Analyzing Governance and Institutional Reforms

It is important to note here that two major definitions of governance have gained currency in the
rapidly growing academic and policy literature on the subject. In the most popular one, used by the
World Bank and most other United Nations institutions, governance is defined as ―the manner in
which power is exercised in the management of a country‘s economic and social development‖.
Essentially, governance, as conceived by these multilateral organs, emphasizes leadership—the
manner in which political (state) leaders manage, use, or misuse power—to promote social and
economic development or to pursue agendas that undermine such goals.
Good governance is conceived from a process perspective with emphasis on rule of law,
accountability, participation, transparency, and human and civil rights. These elements are
indistinguishable from governance elements of a mature liberal democracy.
A second approach to defining governance focuses on sharing authority for public management
between state and non-state organizations. Jan Kooimans (1993:2) and other European researchers
define sociopolitical forms of governing as ―forms in which public or private actors do not act
separately but in conjunction, together, in combination, that is to say, co-arrangements.‖ The school
therefore views governance as forms of multi-organizational action rather than exclusively state
actions. An important difference from the first approach is that governance is judged as good or bad
by both processes as well as by outcomes: the use of state and non-state institutional resources to
solve social problems. This approach is also referred to as the partnership approach to governance.
For many others Governance is approached, as it has always been understood in the political
science literature, as the fundamental rules that regulate the relationships between rulers and the
ruled, the rules-in-use, or constitutive choice rules and operating at deeper levels of analysis than
collective and operational choice rules. The legal community refers to these constitutional rules as
―ground-norms.‖ Although primarily associated with the analysis of the state, governance is a
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generic term that can be applied to all forms of human organizations—economic, cultural,
religious, or military.
The advantage of this third approach is that it enables us to suspend judgment on whether or not
democratic reform is good or bad governance. A process-only approach seems to equate democratic
change to good governance. But we know that governance might actually decline in some
important respects under democratization—especially if the crucial institutions supposed to
perform specific functions are weak or lacking. Process and outcomes are important in this
approach, but from a process perspective governance can be classified in terms of the quality of the
fundamental rules of the political game. While democratic governance promotes rules that ensure
the fundamental equality between rulers and the ruled, autocratic forms assume and reify inequality
between them. But the primary criteria for distinguishing between good and bad governance is the
outcomes of policies promoted by public organs. Good governance results from the activities of
public sector institutions as they work with other societal organizations to formulate public policies
and programs, which are implemented to improve the people‘s welfare, reduce poverty, and realize
other public and societal goals.
5.3 Governance Indicators

The increasing emphasis on good governance as a determinant of development and as a
development objective in itself has created demand for indicators to measure the quality of
governance and by one recent estimate there are now some 140 user-accessible sets of governance
indicators, comprising literally thousands of individual indicators. This has in turn led to the
production of several governance-indicator ‗manuals‘ or ‗guides.
Commonly, these ‗guides‘ distinguishes between governance indicators that are constructed from
objective facts and indicators that are perceptions based. International investors, donors and
decision makers generally tend to rely mainly on perception-based governance indicators. This is
partly due to the fact that the data required to construct facts-based indicators are often lacking for
developing countries, and partly because the numbers that exist for those countries are considered
to be lacking credibility. Furthermore, the data that are used to construct facts-based indicators
often only reflect on formal de jure realities, and not the very different de facto realities on the
ground.
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5.3.1 Fact Based Governance Indicators

The following are instances of fact-based governance indicators:
A. The European bank for reconstruction and development (EBRD)-World Bank Business
Environment and Enterprise Performance Survey compiles the experiences of more than
10,000 firm managers in 1999 and 2002. The managers were asked to estimate the share of
annual sales ‗firms like yours‘ typically pay in unofficial payments to public officials.
B. The International Crime Victim Survey (ICVS) is designed to produce comparable data on
crime and victimization across countries, using a combination of computer-assisted
telephone interviewing techniques in developed countries and face-to-face surveys in
developing countries. Since 1989, more than 150 surveys have been done in over 80
different countries. The ICVSs only provide information on the incidence of corruption
from a household perspective.
5.3.2 Perception Based Governance Indicators

The most widely used perception-based governance indicators, which cover a large number of
countries, are:
A. The International Country Risk Guide (ICRG) provides ratings for 140 countries based on
financial and economic risk assessments, and assessments of political risk. It also offers one-
year and five-year assessments with projections in ‗best case‘ and ‗worst case‘ scenarios.
B. Freedom House provides annual ratings of political rights and civil liberties in 192 countries. It
rates both a country‘s political rights and its civil liberties on a scale from 1 (‗best‘) to 7
(‗lowest‘).
C. The Corruption Perception Index (CPI) is published annually by Transparency International.
The 2007 index includes 180 countries. The CPI assesses the degree to which public officials
and politicians are believed to accept bribes, take illicit payment in public procurement,
embezzle public funds, and commit similar offences. The index ranks countries on a scale from
10 (‗completely clean‘) to zero (‗completely corrupt‘), according to the perceived level of
corruption by business people and country analysts. It is a composite index drawing on
corruption-related data from expert and business surveys carried out by a variety of independent
institutions.
D. The Country Policy and Institutions Assessment (CPIA) is produced annually by the World
Bank‘s country teams. The purpose is to assess the quality of the borrowing countries‘ policy
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and institutional frameworks for fostering poverty reduction, sustainable growth and effective
use of development assistance. These assessments have been used since 1977 to help guiding
the allocation of interest-free loans and grants by the Bank‘s IDA to the poorest countries. The
Bank‘s country team gives a score of 1 to 6 to a country for each of in total 16 criteria. To
enhance consistency of ratings across countries, the Bank now provides the assessment teams
with detailed questions and definitions for each of the six rating-levels. Moreover, before the
country ratings are finalized, an extensive Bank wide benchmarking and vetting process is used
to avoid bias and to counterbalance the natural tendency of country teams to make their
countries look better.
E. The Worldwide Governance Indicators (WGI) produced by the World Bank Institute since
1996 (often referred to as the KKZ Indicators named after their creators). Alongside with
Transparency International‘s CPI, the WGI have played a leading role in putting governance
and corruption on the agenda in developing countries. Due to the large number of sources used
to developing the WGI, the country coverage is very large (212 countries and territories in
2007).
5.4 Anti-Corruption Reforms
5.4.1 Defining Corruption

Corruption is an important aspect of poor governance, and often defined as the abuse of public
office for private gain. This is a widely used definition applied by the World Bank among others.
This definition includes various forms of interaction between public sector officials and other
agents. Money is often involved, such as in bribery or kickbacks for public procurement contracts.
In other cases, however, the private gain can be non-monetary, as in cases of patronage or
nepotism. The definition also covers acts where there is no interaction with external agents or
external agents are not explicitly implicated, such as the embezzlement of government funds, or the
sale or misuse of government property.
Corruption can also take place among private sector parties. Hence, an alternative definition of
corruption used by Transparency International (TI) is the misuse of entrusted power for private
gain. In contrast to the former definition which includes only acts involving public sector officials,
TI‘s definition also includes similar acts in the private sector. For example, a subcontractor that
bribes an official of another company to obtain a contract would count as corruption under the TI
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definition. In addition to public sector corruption, the latter definition thus includes private-private
corruption. This type of corruption is understudied, despite the fact that it may reduce private sector
efficiency and hence hamper development.
The definition of corruption as abuse of public office has been criticized as being (i) excessively
legalistic and (ii) based on a Western ideal of separation of the public and private which does not fit
the cultural context of many developing countries. As for the first criticism, the idea of abuse of
office certainly implies deviation from some standard. It does not follow from the definition itself
that the standard is a legal one, however. The standard could just as well be a moral one, where the
proper role of office holders is derived from fundamental ethical principles. The definition
therefore does not in itself depend on legal rules that may be incomplete or incidental. The criticism
of a basis in Western ideals is a matter of application, although the way the definition is sometimes
applied by donors has been informed by a Western idea of public office. However, the definition
does not in itself refer to a specific idea of public office. In general, any well-functioning society
must have some productive allocation of tasks, to reap the benefits of organization and
specialization.
Corruption and rent-seeking are not the same, though the two are often used interchangeably. Rent-
seeking is the socially costly pursuit of rents, for instance in terms of monopoly rents or rents from
natural resources. There is a degree of overlap, where some acts of rent-seeking would also qualify
as corruption. However, rent-seeking does not necessarily entail misuse of position or power. In
some borderline cases, these types of activities may for instance entail a legitimate pursuit of a
redistribution of available rents. Corruption in this sense can thus be viewed as a violation of the
basic norms of any well-ordered society.
Various typologies of corruption have been suggested. The commonly used distinction is between
political corruption (state capture) and bureaucratic corruption. Political corruption takes place at
the highest levels of political authority. It involves politicians, government ministers, senior civil
servants and other elected, nominated or appointed senior public office holders. In other words,
political corruption is abuse of office by those who make the rules of the game, e.g. decide on laws
and regulations, and the allocation of resources in a society. These types of acts may include
tailoring laws and regulations to the advantage of private sector agents in exchange for bribes,
granting large public contracts to specific firms, or embezzling funds from the treasury. The term
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grand corruption if often used to describe these types of acts, and reflects the considerable sums of
money that are frequently involved.
Most bureaucratic corruption takes place at the implementation end of public policies, although it
may in some cases have its roots in the planning and budgeting stages that precede implementation.
It involves appointed bureaucrats and public administration staff at the central or sub-national
levels. In simple terms, it comprises corrupt acts among those who implement the rules made by
top officials. This includes interaction with private agents, such as demanding extra payment for
providing government services, speed money to expedite bureaucratic procedures, or bribes to
allow private actions that violate rules and regulations. It also includes interaction within the public
bureaucracy, such as bribes or kickbacks to obtain posts or secure promotion, or mutual exchanges
of favors. This type of corruption is often referred to as petty corruption, which reflects the small
payments often involved, though in specific cases and in aggregate the sums may be large.
Political and bureaucratic corruption are clearly interrelated. Corruption at the top of bureaucracies
increases corruption at the lower levels. Political corruption is usually supported by widespread
bureaucratic corruption, in a pyramid of upward extraction. And corruption in high places is
contagious to lower-level officials, as these will follow the predatory examples of, or even take
instructions from, their principals. However, there are also distinctions in the causes and
consequences of political and bureaucratic corruption. The priorities and means by which to
approach the two may therefore be different.
5.4.2 Entry Points for Governance Reform

Governance is often defined as the manner in which public officials and public institutions acquire
and exercise the authority to provide public goods and services, including the delivery of basic
services, infrastructure, and a sound investment climate. The various entry points can be viewed in
relation to the three dimensions of accountability commonly employed. Before we go in to the
discussion of the three dimensions of accountability let us first define accountability.
In general terms, accountability denotes a relationship between a bearer of a right or a legitimate

claim and the agents or agencies responsible for fulfilling or respecting that right. The most basic
accountability relationship is that between a person or agency entrusted with a particular task or
certain powers or resources, on the one hand, and the ‗principal‘ on whose behalf the task is
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undertaken, on the other. Accountability, simply put, is a two-way relationship of power. It denotes
the duty to be accountable in return for the delegation of a task, a power or a resource.
This duty can be discharged in different ways, but the literature suggests that accountability
mechanisms generally operate according to a logic based around three criteria:
 ‗Transparency‟ requires that decisions and actions are taken openly and that sufficient
information is available so that other agencies and the general public can assess whether the
relevant procedures are followed, consonant with the given mandate.
 ‗Answerability‟ denotes an obligation on the part of the decision-makers to justify their
decisions publicly so as to substantiate that they are reasonable, rational and within their
mandate.
 ‗Controllability‟ refers to the existence of mechanisms to sanction actions and decisions
that runs counter to given mandates and procedures. This is often referred to as a system of
checks and balances or enforcement mechanisms. The checks may take many forms,
including ‗shaming‘ and praise. Impunity is the opposite of controllability: apportioning
blame – and a corresponding punishment - for harm done is a crucial component of
accountability.
Vertical accountability refers to the methods by which the state is (or is not) held to account by
non-state agents through the relationship between citizens and their political representatives.
Vertical accountability can be subdivided in two dimensions: First, downward accountability of
political leaders to citizens through electoral channels relates largely to the electoral (or political)
accountability and secondly, downward societal accountability to civil society and the media that
monitor and address actions of the state.
Horizontal accountability refers to the intra-governmental control mechanisms between the

legislature, the executive and the judiciary and between different sub-entities of the executive,
including Cabinet, line ministries and lower-level administrative departments and agencies. In
addition to courts and parliamentary oversight functions, this includes special institutions of
restraint such as the auditor general, anti-corruption commissions, human rights commissions, and
the ombudsman. Horizontal accountability where some government agencies oversee, control,
redress and sanction other government agencies are related to the centre box of public sector
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management, i.e., the political-administrative system and. This includes accountability of

bureaucrats/civil servants/public employees to the political leadership.
External accountability refers to the relationship between governments and international entities,
including the World Bank and bilateral donors. To a large extent, donor-supported anti-corruption
efforts in developing countries have focused on creating and improving institutions of horizontal
accountability, such as anti-corruption commissions, audit institutions, and so on. The effect of
these types of interventions in terms of reducing corruption has been rather disappointing.
To a large extent, donor-supported anti-corruption efforts in developing countries have focused on

creating and improving institutions of horizontal accountability, such as anticorruption
commissions, audit institutions, and so on. The effect of these types of interventions in terms of
reducing corruption has been rather disappointing. A main sticking point has been the
unwillingness of corrupt governments to wholeheartedly implement reforms that reduce their own
opportunities for enrichment. Case in point is experiences with independent anti-corruption
commissions that have been set up in a number of countries. Outside of Hong Kong and Singapore,
these have rarely been a success. A study of anti-corruption commissions in five African countries
argues that the ability of any anti-corruption commission to tackle contemporary, high level
political corruption is questionable. As a consequence of limited results from effort to improve
horizontal accountability, the World Bank and bilateral donors have begun to emphasize reform
that strengthens other types of accountability relationships, such as societal accountability through
civil society organizations and the media.
5.4.3 Anti-Corruption and the Nature of the State
Corruption is a symptom of deep-seated economic, political and institutional weaknesses.

Consequently, to curb corruption relevant measures include economic, political and institutional
reforms, and reforms of the incentive schemes in the public administration. Political will is
considered a necessary condition for implementing the reforms.
Policy measures, however, cannot be addressed properly without including the larger question of
the nature of the state that is supposed to implement the anti-corruption policies. The analytical
framework of neo-patrimonialism developed by French political scientists (Blundo & Olivier de
Sardan 2006; Bayart et al 1999; Chabal & Daloz 1999) working on Africa provides a pessimistic
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view on the issue of political will to implementing reforms. Within this analytical framework
corruption is understood as an integrated part of the dominant elites‘ extraction and rent seeking
practices. Because neo-patrimonial elites are the main profiteers of widespread corruption, they
have limited will for reform. Thus, any lasting effects of institutional and administrative reforms
may be doubtful. In this context, such reforms may even be aimed at securing the political and
economic power of the ruling elites.
To assume that all states and political leaders are ‗predatory‘, however, as in the literature referred
to above and also in much of the public choice literature in the context of developing countries,
does not help in understanding why corruption is more extensive in some countries than in others,
in spite of fairly similar extent of state interventions. Neither does it explain why countries with
seemingly similar aggregate levels of corruption, differ with respect to productivity and economic
growth.
Bardhan (1997) argues that some African states in recent history have become predatory in their
rent extraction not because they are strong, but because they are weak. The state cannot enforce the
laws and property rights that provide the minimum underpinnings of a market economy, leading to
disloyalty and theft among public officials. In sharp contrast stand the strong East Asian states with
their centralized rent seeking machinery and their encompassing network with business interests,
although the level of corruption is quite substantial also in these countries. Credible commitments
to both domestic and foreign business interests may be an important feature of the strength of these
states.
Acknowledging these differences between centralized and decentralized corruption, and the
importance of predictability, getting rid of many of the public dysfunctional regulations remains a
major first step in anti-corruption policy, whatever the nature of the state. Furthermore, both
economists and political scientists seem to emphasize the importance of institutionalizing various
kinds of accountability mechanisms at different levels of the government. However, it is important
to recognize that some conditions are profoundly difficult to change. In order to improve the
chances of making a positive difference in countries with weak governance and severe corruption,
it is important to acknowledge that:
• Political will is often partial, qualified and temporary.

• Economic resources are usually seriously inadequate.
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• Governance institutions often have significant weaknesses, and may require a long time to
improve.
The general message of the anti-corruption reformers, until recently, has been that corrupt countries
should replicate the institutions of clean countries. Thus, many countries have adopted various
Western institutions. The ombudsman, for example, is a Scandinavian institution that has been
reproduced in many developing countries, often with limited success. There is now a growing
consensus between researchers and development practitioners on the importance of tailoring
reforms to the particular country context. These insights imply that there is no ‗best practice‘ anti-
corruption reform that could be uniformly applied to all countries, and that there is no single cross-
country model of reform: The context matters. Local economic conditions, institutional constraints,
administrative capacity, culture and history are important factors that must be taken into
consideration when designing and implementing anti-corruption reforms.
So, what can policymakers do to combat corruption? According to Shah & Schacter (2004) the
answer lies in taking an indirect approach and starting with the root causes. To understand why,
they suggest a model that divides developing countries into ‗high‘, ‗medium‘, and ‗low‘ incidences
of corruption. They assume that countries with ‗high‘ corruption have a ‗low‘ quality of
governance, those with ‗medium‘ corruption have ‗fair‘ governance, and those with ‗low‘
corruption have ‗good‘ governance.
Because corruption is itself a symptom of governance failure, the higher the incidence of
corruption, the less an anticorruption strategy should include tactics that are narrowly targeted at
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corrupt behavior and the more it should focus on the broad underlying features of the governance
environment. For example, support for anticorruption agencies and public awareness campaigns are
likely to have limited success in environments where corruption is rampant and the governance
environment deeply flawed. In such environment‘s anticorruption agencies are prone to being
misused as tools of political victimization. Such interventions are, according to Shah & Schacter,
more appropriate in a ‗low‘ corruption setting, where the governance fundamentals are reasonably
sound and corruption is a relatively marginal phenomenon.
Where corruption is high and the quality of governance is correspondingly low, it makes more
sense to focus on the underlying drivers of malfeasance in the public sector – for example, by
building the rule of law and strengthening institutions of horizontal accountability. In addition to
courts and parliamentary oversight functions, this includes special institutions of restraint such as
the auditor general.
In societies where the level of corruption lies somewhere in between the high and low cases, Shah
& Schacter suggest that it may be advisable to attempt reforms that assume a modicum of
governance capacity - such as trying to make civil servants more accountable for results, bringing
government decision making closer to citizens through decentralization, simplifying administrative
procedures, and reducing discretion for simple government tasks such as the distribution of licenses
and permits.
It may of course be argued that the categorization of countries as high, medium and low corrupt is
too broad and does not capture the large differences between countries within each category. This
critique might be accommodated by further fine tuning the model suggested by Shah & Schacter, as
illustrated in the next section. Their main message, however, is that context matters, and that anti-
corruption reforms must be tailored to country realities.
5.4.4 Politics Matters

Why do so many anti-corruption initiatives fail? Shah & Schacter (2004: 40) argue that the lack of
significant progress in fighting corruption can be attributed to the fact that many anti-corruption
programs are ‗simply folk remedies or one-size fits all approaches and offer little chance of
success‘. This is supported by Mungiu-Pippidi (2006: 91) who argues that ‗[t]he problem is that
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both the assessment instruments (which result in a descriptive ―anatomy of corruption‖) and the
resulting anti-corruption strategies seem to be simply replicated from one country to another‘.
Corruption in developing and post-communist countries has often been treated as an ‗engineering
problem‘ – and as such a phenomenon to be addressed through technocratic ‗toolbox‘ or ‗textbook‘
solutions. There seems to have been an assumption that corruption and its solutions could be fully
specified in advance, and the required measures implemented on a predictable timetable, over a
fixed period. The technocratic approach, however, has overlooked the fact that anti-corruption
reform, though it has important technical aspects, also is a social and political phenomenon driven
by human behavior and local circumstances. Many anti-corruption initiatives fail because they are
non-political in nature, while most of the corruption in developing and post-communist countries is
inherently political. Moreover, what is labeled corruption in these countries may not be the same
phenomenon as corruption in developed countries. In the latter, the term corruption usually
designates individual cases of infringement of the norm of integrity. In the former, corruption often
means a mode of social organization characterized by the regular distribution of public goods that
mirrors the distribution of power within such societies. Few anti-corruption campaigns dare to
attack the roots of corruption in such societies as these roots lie in the distribution of power itself.
Instead, anti-corruption strategies are adopted and implemented in cooperation with the very
predators who control the government and, in some cases also the anti-corruption instruments.
Historically, it has been the political opposition, civil society, or even enlightened despots who
have promoted the greatest strides forward. When are circumstances ripe for civil disobedience
against political corruption and state capture? In situations where most people are content with
existing arrangements and do not feel that they personally have anything to lose by corruption, one
simply cannot fight state capture. This also applies to situations where people feel powerless to
change the system and do not want to get hurt trying. Thus, it is best to attack such systems during
economic crises or other periods of societal stress. Great political turning points can also provide a
favorable environment. Civil society is potentially a more effective auditor and a more credible
ombudsman than public institutions in such societies.
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Section Two: Capacity Development

5.5 .Capacity Building
Capacity is the ability of individuals, institutions and societies to perform functions, solve
problems, and set and achieve objectives in a sustainable manner. Capacity Development (CD) is,
therefore, the process through which the abilities to do so are obtained, strengthened, adapted and
maintained overtime.
In the context of this understanding, institutional and administrative capacity can be defined as the
set of attributes related to both structural/systemic attributes and human capital/resources that,
collectively, define the organization's ability to perform its mandated functions. Within the public
service, typical aspects of capacity are the quality of civil servants, organizational characteristics,
the diffusion of ICTs among organizational units, the intergovernmental relations, and the style of
interaction between government and its social and economic environment.
In the context of this definition, institutional capacity building can be defined as the provision of
technical or material assistance designed to strengthen one or more elements of organizational
effectiveness. The elements of organizational effectiveness include governance, management
capacity, human resources, financial resources, and service delivery. At the national level,
institutional capacity is often used as shorthand for a country‘s administrative and management
capacity, particularly with respect to implementing economic policy choices.
At this level, it encompasses a wide range of activities examples of which include the following:
a. the making and enforcement of rules and laws, including judicial reforms;
b. the ability to effectively plan government expenditure and the delivery of public services at
both the central and local government levels
c. the establishment and operation of appropriate regulatory and/or prudential frameworks for
conducting productive business;
d. the ability to collect the statistical information needed for effective policy implementation;
e. systemic capacity to absorb additional resources, including external assistance/aid;
f. the effectiveness of agencies to fight corruption and enhance governance; and
g. The protection of property rights.
Human resource capacity development, in turn, relates to the provision of a trained work force; to
the promotion of knowledge and skills that are required by a society to acquire greater prosperity
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through the building of productive capabilities. Human resource development can be perceived as
both a process and a goal since it can be an end in itself as it results in the realization of human
potential and the development of individual self-reliance.
CD is defined by the UNDP as the process through which individuals, organizations and societies
obtain, strengthen and maintain the capabilities to set and achieve their own development
objectives over-time. Individual-level capacity includes a person‘s skills, experience and
knowledge. Organizational-level capacity includes internal policies, arrangements, procedures and
frameworks. Societal-level capabilities – also referred to as an enabling [institutional] environment
– encompass the rules of the game, which include policies, legislation, power relations and social
norms that shape interactions among organizations.
The World Bank‗s Strategy for Reforming Public Institutions and Strengthening Governance
defines capacity building as ―building effective and accountable institutions to address
development issues and reduce poverty in borrowing countries, and emphasizes its importance as
the core of the World Bank‗s activity.
5.6 The Nexus between Capacity Building and Institutional Reform

As mentioned in the first unit, capacity development is used along with capacity building,
institutional development, public sector reform, and governance reform, frequently to mean the
same thing. For example, capacity development is understood as building and strengthening
human, organizational, institutional, and societal capabilities in developing countries mainly
focused on their public administration systems.
While this term is not new to the development assistance field, the currently emphasized
focus/scope and the means of improving capacity reflects the broader shift in thinking about
development. In terms of focus/scope of CD, donors switched from individual- and organizational-
level to broader societal and governance level. In the past, technical capacity building with
emphasis on individuals and organizations received more attention, involving the simple transfer of
knowledge or organizational models from North to South. Donors did not pay as much attention to
the broader context of their interventions. More recently donors came to emphasize macro-level
components of capacity development; i.e., building, developing, and transforming the very
governance system and its institutions that structure the behavior of individuals and organizations.
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Donors learned that the past focus on inputs, such as developing organizational capacity through
training and technology transfers and policy advice was not adequate when institutions rules of the
game that converted those inputs into desirable outputs within a given governance system remained
the same. In this sense, institutional reform/development is part of capacity building efforts
regardless of whether institutions are defined as rules of the game or as organizations. But as
mentioned above, institutional development is sometimes used interchangeably with capacity
development.
This emphasis on institutional capacity building is conditioned by IDA‘s understanding that: the
heart of the problem in ―poor societies‖ is not the lack of funding or technical know-how (the
traditional components of aid), but a matter of governance and the resulting inability to make good
use of existing institutions and capacities. Thus, the leading IDA now intend to focus more on
helping developing countries to set up proper incentive structures via institutional reforms that
would in turn improve government capacity.
Capacity development is now about strengthening the capability of government and the internal
demand for improved governance through strengthening the capacity of civil society organizations
and the private sector, although public sector reforms still are recognized as an essential element of
capacity development. Within the public sector, donors‘ CD activities targeted developing
countries‘ planning, resource allocation and monitoring systems, including ―statistics, public
financial management, accountability systems, systems of oversight, taxation, fiscal systems,
monitoring and evaluation, planning systems, budget management, procurement, and audit systems.
The challenge of capacity building for effective service delivery has preoccupied most African
countries since independence. There are a number of institutional and resource constraints that have
continued to work against African countries‘ capacity to meaningfully design and implement
developmental interventions. Increasingly, there is mounting recognition among African leaders
that capacity development is at the center of development and that, without it, even past
achievements could be reversed. Similarly, there is growing self-examination in the West regarding
the degree to which aid, for example, is helping in strengthening capacity development in
developing countries. In the light of the above, many African countries have implemented various
reform packages aimed at improving the capacity of the public sector.
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Effort to develop institutional and human resource capacity for improved public sector
performance, it is argued, can be addressed by focusing a number of interventions. Important
among these are three: one relates to the concern for improved performance in public bureaucracy
through modernization of methods, techniques and procedures of work and more effective
management of human resources. Another is the process of change required within the government
sector to sustain efficient economies in the emerging context of globalization. The third is the
increasing concern for efficient and effective delivery of key public services through
decentralization.
The achievement of the ideal system described above calls for a comprehensive approach in which
several parallel initiatives are undertaken at different points in the State system. These various
initiatives involve performance management, greater participation in decision-making throughout
an organization; supportive organizational structures, information and financial management
systems; and definitive instruments for incentives and rewards for civil servants through proactive
personnel management as well as strong executive leadership development. In the light of this,
many countries and organizations have undertaken administrative reform. A sample of some of the
most prominent ones was discussed in the previous chapter.
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COURSE 12: INTRODUCTION TO PUBLIC ADMINISTRATION

Chapter One
Meaning and Scope of Public Administration
Public administration is the management of governmental affairs or issues at all levels or tiers,
national, regional (state), and local. It is the branch of the wider field of administration. There
are slight differences between "administration" and "public administration".
The word administer is derived from the Latin words administrate, which means to care for or to
look after people, to manage affairs. According to this wide definition almost every human
activity involves some kind of administration. Even in primitive societies, simple activities like
hunting, food, gathering, etc., could not be carried on without some form of organization.
Somebody had to determine as to who will do what. Certain norms of behavior had to be laid
down to decide the distribution of work among the members of the primitive groups. Of course,
the administration at that time was rather simple because the tasks to be carried out were also
simple. With the growing complexity of modern life the administration of private as well as
public affairs has become more and more complex.
Different writers defined the term "administration" in various ways.
 For Marx (1964:4), "Administration is a determined action taken in pursuit of a
conscious purpose. It is a systematic ordering of affairs and the calculated use of
resources aimed at making those things happen which one wants to happen".
 Pfiffner (1960:3) also defined administration as "…the organization and direction of
human and material resources to achieve desired ends…getting the work of government
done by coordinating the efforts of the people so that they can work together to
accomplish their set (predetermined) tasks".
 L. D. White (1955:1) explained, "Administration is a process common to all group
effort, public or private, civil or military, large-scale or small scale..."
 Luther Gulick has said, ―Administration has to do with getting things done; with the
accomplishment of defined objectives‖.
 James L. McCanny defined Administration in these words, ―Administration is the
organization and use of men and materials to accomplish a purpose. It is the specialized
vocation of managers who have skills of organizing and directing men and materials just
as definitely as the engineer has the skill of building structure or a doctor has the skill of
understanding human ailments‖.
The important elements of administration, according the above definitions, are cooperative
effort, systematic application, and purposefulness. In other words, administration is essentially
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a group activity which involves co-operation and coordination to achieve desired goals or
objectives.
Public Administration on the other hand can be understood as any kind of administration in the
public interest. This simply means governmental administration. Therefore, the difference
between "administration" and "public administration" are essentially revealed in their scope, the
former being much broader than the later.
There are also differing views regarding the scope and range of activities to be included in public
administration. Lack of consensus on the scope of public administration has led to different
approaches in the definition of the subject. As Ferrel Heady (1966) put it "Despite several
decades of development, consensus about the scope of public administration is still lacking, and
the field has been described as featuring heterodoxy rather than orthodoxy". Therefore, different
writers have variously defined the subject. Some thinkers view it broadly to include all
governmental activities-policy making and policy execution, while others see it narrowly to
consider only those activities concerned with the executive branch of the government. Those
who advocate the latter approach include reputable writers such as Woodrow Wilson (labeled as
founding father of public administration or the pioneer of public administration as a subject of
study), L.D.White, Marshal E.Dimock, Herbert Simon and John M. Pfiffner.
The definitions given by different thinkers show the emphasis they lay on different aspects of
public administration. Some of the definitions include:
 "Public administration consists of all those operations with the purpose of the fulfillment
or enforcement of public policy", L.D White (1955).
 "Public administration is detailed and systematic application of law", Woodrow
Wilson(1889)
 "Public administration is the fulfillment or enforcement of public policy as declared by
the competent authorities…it is law in action, it is the executive side of the government",
Marshal E. Dimock, (1937).
 Percy McQueen ―Public Administration is administration related to the operations of
government whether local or central‖.
 Luther Gulick defined public administration in these words, ―Administration has to do
with getting things done … Public Administration is that part of science of
administration which has to do with the government and thus concerns itself primarily
with the executive branch where the work of the government is done, though there are
obviously problems also in connecting with the legislative and judicial branches‖.
 Herbert Simon on his part says public administration is the government action, which
coincides with the activities of the executive or administrative branch only.
 Ferrel Heady views public administration as a "field concerned primarily with the
carrying out of public policy decisions made by authoritative decision makers in the
political system".
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 J.M. P fiffner– thought that public administration ―consists of getting the work of
government done by coordinating the efforts of the people so that they can work together
to accomplish their set tasks. Administration embraces the activities which may be highly
technical or specialized such as public health and building of bridges… It also involves
managing, directing and supervising the activities of thousands, even millions of workers
so that some order and efficiency may result from their efforts…..‖
Nigro (1965) defined public administration in a more comprehensive way to include, besides the
above-mentioned aspects, the relationship between public administration and the political and
social systems as well. For him public administration:
1. Is cooperative effort in a public setting
2. Covers all the three activities or branches of the government; i.e. executive, legislative,
and judiciary and their interrelationships
3. Has an important role in the formulation of public policy and is thus part of the political
process
4. Is more important than, and also differs significantly from private administration
5. Has been much influenced in recent years by the "human relations approach" both as a
field of study and practice
6. Is closely associated with numerous private groups and individuals in providing services
to the community
There have been also attempt to define public administration with respect to its internal and
external dimensions:
 Internal administration is defined to mean the management of an organization or
agency that involves systems, processes and methods through which needed
resources of personnel, material and technology are used to perform certain
prescribed functions.
 External administration on the other hand refers to activities and processes of
administration, which are needed to establish and to activate relationships with
agencies and groups outside the administrative control of an organization to
achieve its objectives.
A system of public administration is the composite of all the laws, regulations, practices,
relationships, codes, and customs that prevail at any time in any jurisdiction for the fulfillment or
execution of public policy. Functionally speaking also, the art of administration is the direction,
coordination, and control of many persons and other resources to achieve some purpose or
objective. It is a dynamic art, taking the human and physical resources to the achievement of
some required goals.
Generally, public administration is the non-political bureaucratic machinery of the government,
but operating within the political context, for implementing its laws and policies in action such as
the collection of revenues, maintenance of law and order, maintaining an army,
providing/running social and economic services. Public administration is a means by which the
policy decisions made by the political decision-makers are carried out.
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The following is an all-encompassing definition that consist a list of functions of public

administration.
"Public administration is decision-making, planning the work to be done, formulating
objectives and goals, working with the legislative and citizen organizations to gain public
support for government programs, establishing and revisiting organizations, directing and
supervising employees, providing leadership, providing and receiving communications,
determining work methods and procedures, appraising performance, exercising controls and
other functions performed by government executives and supervisors. It is the action part of
the government, the means by which the purposes and goals of government are realized"
(Michael P. Barber, 1983:1; Rumki Basu, 1994 :)
This comprehensive definition and all points raised under this sub-topic could enable us to
understand not only the meaning of public administration, but also its major concerns, aspects,
purposes and scope. It is to mean that public administration is concerned with action in particular
or concrete situation, but in accordance with long-range objectives.
The immediate objective of the art of public administration is the most efficient and effective
utilization of resources at the disposal of officials and employees. The aspects of public
administration are innumerable and its scope is generally wide. The scope of public
administration has been broadening from time to time with the growing expectations of people.
In other words, what public administration is supposed to do varies with people's expectations of
what they should get from the government.
As White said (1955:3), two centuries ago people expected little from government but
oppression. A century ago they expected primarily to be let alone, let them free from intervening
in their affairs. Now, they expect a wide range of services and protection from the government.
Accordingly, government becomes the common agency to explore and preserve mutual interests,
and to adjust competing interests through its machinery; i.e. Public administration. .
Public administration is, therefore, the means by which these policy adjustments are made
effective. In broad context, the ends of public administration are the ultimate objectives of the
state itself-the attainment of the good life.
1.2 Approaches to the Study of Public Administration

PA is so vast that there is no way to encompass it all with only one definition. So it has to be
defined from different perspectives. Define public administration within the context of its four
frames or dimensions: Political, Legal, Managerial and Occupational.
Political definition of Public Administration
Public administration is what government does. It exists within a political environment, and it is
this political context that makes it ―public.‖ What makes it different from private administration
is cannot exist outside of its political context. However, PA is the non-political bureaucratic
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machinery of the government, but operating within the political context. Public administration is
about implementation of the public interest. Public Administration is a phase in the public
policymaking cycle. It is also about doing collectively what cannot be done as well individually.
Legal Definition of Public Administration
The foundations of public administration in the United States are legal ones and are bound by
instruments of law. Public administration is law in action in the form of statutes, regulations,
ordinances, codes, etc.
 It is related to the judicial function of government.
 It emphasizes the administrators‘ role in applying and enforcing the law in specific
situations.
 PA is the law in action (execution of a public law)
 Every application of a general law is necessarily an act of administration.
 PA is regulation- It is government telling citizens and businesses what they may or may
not do.
 PA is theft/ robbery/stealing. This relates with redistribution function of the government.
 Ayn Rand – the only proper function of the government of a free country is to act as an
agency which protects the individual‘s rights.
Managerial definition of Public Administration
The executive nature of public administration enables the public will to be translated into action
by the people responsible for running the public bureaucracy.
 Public Administration is the executive function in Government
 Public Administration is a management specialty- Luther Gulick: POSDCORB
functions: stands for Planning, Organization, Staffing, Directing, co-ordination,
Reporting, and Budgeting.
Occupational definition of Public Administration
 Public Administration is an occupational category
 Public Administration is an academic field
 Public Administration is a profession
Stages in the Study of Public Administration
The evolution of public administration as an academic discipline falls mainly into the following
six crucial stages.
Stage One
The first stage, which began with the publication of Woodrow Wilson's work, "The Study of
Administration" in 1887, can be called "the era of politics-administration dichotomy". Wilson
is considered as the founder of the academic discipline of public administration. Making a
distinction between politics and administration, he argued that administration is concerned with
the implementation of political policy decisions.
Another notable event of the period (first stage) was the publication of Goodnow's in title
"politics and administration" in 1900, which supported the Wilsonian idea further by
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conceptually distinguishing the two functions. According to him, "politics has to do with
policies or expressions of the state will" whereas "administration has to do with the execution
of these policies".
Apart from this, the institutional locations of these two functions were differentiated; the
location of politics were identified with the legislature and higher levels of the government
where major policy decisions were taken, while the location of administration was identified
with the executive branch of the government and the bureaucracy.
With an increasing recognition of the study of public administration in American universities,
Leonard D White (1926) wrote a book known as "Introduction to the Study of Public
Administration", which was recognized as the first textbook on the subject. This book, while
advocating a politics-administration dichotomy, stressed the human side of administration,
dealing comprehensively with administration in government.
Stage Two
The second stage of evolution is marked by the tendency to reinforce the idea of politics-
administration dichotomy and to evolve a value-free "science of management". The central
belief of this period was that there are certain "principles" of administration, which were the task
of scholars to discover and advocate. Important works of this period sharing the same approach
were:
 "Principles of Public Administration" by Willoughby (1927),
 "Principles of Organization" by Mooney and Reiley,
 "Creative Experience" by Mary P Follett,
 "Industrial and General Management" by Fayol,
 "Papers on the Science of Public Administration" by Gulick and Urwick, eds (1937),
The main reason for the upsurge of interest of administration in this period was absence of
enough skilled personnel to perform the rapid multiplication of government functions following
the 1930s Great depression. Therefore, schools of public administration were established to
quickly train as many people as possible in the techniques of administration.
The main difference between the protagonists of the politics-administration dichotomy of the
first and second stages in the evolution of the discipline is that, while the former ones
emphasized the legal and constitutional aspects, the new school of scientific management of the
second period emphasized a purely scientific approach to the study of public administration, but
retaining ideas of the first period.
With the help of scientific management methods, the leaders of public administration tried to
discover certain principles of public administration, which could be of universal applicability.
Gulick and Urwick (1937) coined the word BOSDCORB to promote some of these principles of
administration. BOSDCORB stands for Planning, Organizing, Staffing, Directing,
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Coordinating, Reporting, and Budgeting. These maxims (principles of administration were said
to be of universal applicability in all organizations.
Stage Three
The third stage began with a creation against the mechanical approach. The so-called
"principles" of administration were challenged and dubbed as "naturalistic fallacies" and
"proverbs". The third stage approach was based on experiments and organizational analysis. The
experiments, which focused upon work groups, have brought a major shook on the foundations
of the scientific management school of thought by clearly demonstrating the influence of social
and psychological factors on the worker's output.
This approach also drew attention to the effect of informal organization in the formal setup, the
phenomenon of leadership and influence, and impact of conflict and cooperation among groups
in the organizational environment. Thus, the approach revealed the vital importance of human
relations in organizations. Lastly, this approach criticizes the politics-administration
dichotomous analogy of the first and second period thinkers. Politics and administration couldn't
be separated; one couldn't be taken out of the other.
Stage Four
The fourth stage was usher by two significant publications in the 1940s; i.e. Simon's
"Administrative Behavior" that associates itself to the behavioral field and Robert Dahl's "The
Science of Administration: Three Problems". Simon's approach widened the scope of the subject
by relating it to psychology, sociology, economics, and political science. He rejected both the
classical "principles" of administration and the "politics-administration dichotomy" in
administrative thought and practice. He argued that all administration revolves around rationality
and decision-making. Simon identified two mutually supportive streams of thought;
 One was engaged in the development of a pure science of administration, which

required a solid base in social psychology, and the other was concerned with the
normative aspects of administration and prescription for public policy.
 The second approach would require a broad understanding of political science,
economics, and sociology as well.
He favored the coexistence of both approaches, empirical and normative, for the development of
the discipline of public administration. Likewise, Dahl's essay identified three important
problems in the evolution of the science of public administration:
(i) The impossibility of excluding normative considerations from the problems of public
administration. Values inevitably (permeate) filter through administration while science
is value-free.
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(ii) The inescapability of the fact that the study of administration must include a study of
human behavior, which is open to all possible variables and uncertainties making it
impossible to subject it to the rigors of scientific enquiry.
(iii) The tendency to pronounce universal principles based on few examples drawn from
limited national and historical settings.
Thus, the principles of public administration were attacked. They were not scientific but
normative, not universal but culture-bound. They were not grounded in evidence but based on
misplaced corporate analogies and autocratic assumptions.
Stage Five
The fifth stage is concerned with the nature of post-war developments and transformations,
taking place in both the theory and practice of public administration. The older approaches have
not been totally abandoned in this period but modified considerably in the light of new
developments.
Firstly, administration came to be viewed increasingly as a unit in the process of continuous
interactions between the people inside and outside the organization at any given period of time.
Secondly, separate studies of public and private business administrations tended to merge into a
single science of organization, whose theories and concepts were to be equally applicable to both
private and public administration
Thirdly, the increasing use of the systems and the behavioral approaches encouraged the
comparative study of administrative systems in diverse social settings and environments. New
perspectives were seriously needed and the impetus for the study of comparative public
administration and development administration (a relatively unknown field before WW II)
became apparent.
In the transfer of administrative know-how to the developing countries, western administrative
concepts were found to be inadequate. The result was questioning of the traditional framework of
public administration and its universal applicability.
Stage Six
The final (six) stage of the evolution of public administration coincides with a general concern in
the social sciences for public policy analysis. This approach was a post WW II war phenomenon,
and was built upon two basic themes:
(i) The interpenetration of politics and administration at any levels; and
(ii) The programmatic character of all administration.
The interdisciplinary policy process and planning approach has become the most useful and
relevant guide to practical administrators in developing and developed societies alike. The
adoption of the policy approach has revealed that public administration, which faced the
disturbance of crisis of identity since the 1940s is an interdisciplinary and applied field.
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It came to be known as an integrating discipline- the meeting ground for all branches of
knowledge. According to Rumki Basu (1994:17), the problem of crisis of identity has been
resolved with the recognition and acceptance of the field as interdisciplinary and an applied
subject. In the words of James Fesler public administration, is policy formulation and policy
execution, public administration is bureaucracy, and public administration is public.
These premises directed attention in public administration towards political or policy-making
processes and specific public programs. Since 1968, the evolving discipline of public
administration has come to be enriched by the emergence of what has come to be known as the
"New Public Administration".
1.3 Significance/Importance of Public Administration

The importance of Public Administration has tremendously increased with increase in state
activities. The state is no longer regarded as a preserver of the status quo. The centuries old
nation of police state which was to be responsible only for the maintenance of law and order and
the policy of non interference in the day-to-day activities has completely lost its relevance. The
modern state has undertaken the new role of accelerator of economic and social change as well
as a prime mover and stimulator of national development. With this change in the ends of
modern state, the purposes of public Administration have also assumed a different dimension and
orientation. Its functions have enormously increased in number, variety and complexity and its
methodology has grown from the trial and error stage into an orderly discipline with an
organized, ever increasing body of knowledge and experience.
The significance of the public administration can be studied from different points of view,
namely:
i) Its significance as an instrument of governance;
ii) Its significance as an instrument of development and change;
iii) Its significance in modern domestic welfare state;
i) Significance of Public Administration as an Instrument of Governance

The most important function of the Government is to govern i.e. to maintain peace and public
order and to ensure the safety and security of the life and property of the citizens. It has to ensure
that the contracts are honored by the citizens and their disputes settled. This most significant role
of the Government is to be fulfilled through the instrument of public administration. In the
beginning of the civilization this was probably the only function performed by the public
administration. As the civilization has advanced, many very important functions have been taken
over by the Government, but, the importance of this basic function should not be minimized.
Worthwhile progress or development is possible unless the citizens can live in peace. The
continuing performance of this function is like the presence of oxygen in the air we breathe. It is
hardly noticed so long as it exists. However, in its absence civilized life is impossible.
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It is also a mistake to think that this regulatory function of the public administration has been
static. It has been growing with the growing complexity of modern civilization. For example,
new methods of investigation have had to be devised to take care of the better equipped
criminals. New sets of controls had to be devised to enable the citizens to share the scarcity of
food and other essential articles.
ii) Significance of Public Administration as an Instrument of Development and Change

The public administration has to play a very significant role as an instrument of development and
change. The administration of the country reflects the genius of its people and embodies their
qualities, desires and aspirations. Whenever the people decide to proceed on the road to
development, their main instrument is the public administration. They need trained manpower to
run schools, colleges and the technical institutions. They need technical manpower to build
roads, bridges, buildings and to run the machines in the industry. They need scientific manpower
to undertake research and development. It is the well-developed public administration which
makes all this possible. It is true that part of the effort comes in the private sector, but it alone
cannot complete the task. A lot of basic infrastructure has to be developed for which the private
initiative is usually not forthcoming. For example, nationwide rail transport, telecommunication
network, fundamental research are all to be organized by the Government.
In several development areas initial thrust has to be provided by the Government. All this is not
possible without a well developed public administration. This fact was also highlighted by the
American administrators and private aid giving agencies who took up the task of assisting the
developing countries. It was their experience that the recipient countries could not make much
use of their assistance because they did not have the well-equipped administrative machinery to
absorb it. The equipment provided by them could not be used for want of skilled manpower.
Financial assistance could not be channelized into productive schemes. The first task of
developing countries is, therefore, to develop adequate administrative machinery which can take
up the diverse tasks required for all round development.
The above discussion may create an impression that the public administration plays a significant
part only in economic development. Nothing could be farther from truth. In a developing
country, the public administration is also an instrument of social change and development. A
number of social welfare measures have to be taken up. New laws have to be enacted and
enforced. The obvious examples are anti-dowry laws and laws for the protection of weaker
sections like labor, children, women etc. While the impetus for social change may come from the
political process, somebody has to draft the laws and enforce them. This is the task of public
administration.
(iii) Significance of Public Administration as an Instrument of Welfare State

In a modern democratic welfare State, the Government has to provide many services for the
welfare of its citizens. It includes the provision of schooling, medical facilities and social
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security measures. With the breakdown of joint families, the problem of looking after the old and
infants, orphans and widows comes up. With the slowing of economic activity, the problem of
unemployed youth crops up. The development process brings up many new problems like those
of urban slums and juvenile delinquents. The welfare State has to identify these problems and
devise solutions for them. The formulation of these schemes and their implementation is another
significant function of public administration.
The public administration is thus not only a protector of citizens from external dangers or
internal disorders, but has become the greatest provider of various services. The welfare of the
people depends very much on the way the public administration functions. No wonder today‘s
state has been called an ―Administrate State‖. Prof. V.V. Donham has rightly said, ―If our
civilization fails, it will be mainly because of administration‖.
More specifically, public administration has the following importance:
 Administration is an important human activity in modern society.
 Administration is an activity that confers benefits on society and affects the lives of all
individuals. For example, each day products are produced, services such as housing,
electricity, water, etc. are provided.
 Each of us is an administrative person since a considerable part of our lives is spent in
organizations. Organizations are prominent in modern society because they provide
certain desirable services and commodities. Organizations and administrations are very
much interlinked.
 Public Administration is the very heart of our democratic way of life. Civil servants, for
example, are not elected, yet they greatly control the way in which we live.
 It is the basis of Government whether in monarchy or in democracy or in communist
country.
 It is the instrument for executing the laws, policies and programs formulated by the
state.
 It is the instrument of social change and economic development especially in the
developing countries which are engaged in the process social-welding and nation-
building.
 It is an instrument of national integration particularly in the developing countries which
are facing the challenges of sub-nationalism, secessionism, and class wars and so on.
 It is the instrument of the state for providing to the people various kinds of services like
education, health, water, transport, etc.
 It is a great stabilizing force in the society as it provides continuity when governments
change either due to revolutions or elections or coups.
 A study of Public Administration will provide an insight in to questions like control,
accountability and openness.
Crucial roles of Public Administration in contemporary society (Gerald Caiden)
 Preservation of the political system
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 Maintenance of stability and order

 Institutionalization of socio-economic changes
 Management of large scale commercial services
 Ensuring growth and economic development
 Protection of the weaker sections of society
 Formation of public opinion
 Influencing public policies and political trends
1.4 The Art and Science Expositions of Public Administration

Question: Is public administration an Art, Science or both?
There has been a controversy over the status of Public Administration. Some scholars consider it
as a science while most of the practitioners of management theory stress that it is an art. Let us
now consider and then try to establish whether Public Administration is a Science or an Art.
Considering Pubic Administration as Science has two implications i.e. it could be a Science or it
could be a Social Science.
Let us first examine as to how Public Administration can be considered as a science. ―Science‖
has 2 branches i.e. ‗Pure Science‖ and ―Social Science‖. The ‗Pure Science‘ has the following
characteristics:
(i) Universality of laws
(ii) Exactness of the results based on these laws
(iii) Predictability of events.
In Public Administration there has been a quest to find out universal laws. But such universal
laws have so far not been established. Similarly the results are in excess to some degree and the
events, since they involve human behavior, are also not totally predictable. Hence Public
Administration cannot be considered to be a ‗Pure Science‘ in its present status of understanding.
Now we may consider as to how Public Administration be considered as a ‗Social Science‘.
Social Science is defined as - ‗a systematic body of knowledge derived from day-to-day
experience, observations and practice‖. A social science contains concepts, hypothesis, theories,
experimentation, principles, etc. and to develop these principles either inductive approach or
deductive approach is used. Hence based on above definition, Public Administration can be
considered to be Social Science because:
1. It contains a body of exact knowledge derived from experiences and observations which
are applicable in practical situations. Hence in this respect it is as much a general science
as economics or psychology or biology.
Through continued efforts, a body of principles which are applicable in any administrative set up
has been developed. These principles are required to be applied in order to secure efficiency in
administration. For example, As Wilson explained, Public administration is detailed and
systematic execution of public law. Especially, Woodrow Wilson, the pioneer of public
administration as a subject of study, called it the 'Science of Public Administration' as early as
1887. By the same token, W.F. Willoughby (1926) asserted that in administration there are
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certain fundamental principles of general application analogous to those characterizing any

science. In 1937, a collection of papers on the subject made appearance under the significant title
of 'Papers on the Science of Administration' edited by Luther Gulick and L. Urwick. Pfiffner
writes that public administration is concerned with 'the what' and 'the how' of government. The
'what' is the subject matter, technical knowledge of a field which enables an administrator to
perform his/her tasks. The 'how' is the technique of management.
2. It employs scientific methods of investigations in its study e.g. research and analysis is an
indispensable part of any public policy.
3. It uses scientific process i.e. facts and data are collected and analyzed and based on this
analyze generalizations are arrived at. Hence an administrator applies science in much the
same manner as an Engineer or a Doctor.
4. It has also developed its own body of subject matter as distinct from other social science
disciplines, though it is inter-disciplinary and multi-disciplinary.
Therefore, it can be said that Public Administration is a corpus of demonstrated truths and hence
a social science. However, as a social science, Pubic Administration has deficiencies, which
present impediments in the path of it being considered as a social science. These are:
 Public Administration involves dealing with Human Behaviour in organization which is
not amendable to experimentation in laboratory conditions. Besides, most part of the
subject matter of Public Administration is not amendable to experiments.
 Simon in ―Administrative Behaviour‖ has criticized that the principles propounded in the
discipline of Public Administration are mutually contradictory and he has said that they
are nothing but homely proverbs.
 The subject matter of Public Administration is not free from values and hence its study
can‘t be completely objective, while objectivity is the prime criterion for a discipline to
be considered as a science.
 Public Administration is also culture-bound i.e. Public Administration in one country is
quite different from Public Administration in another country.
However, one can still regard Pubic Administration as a social science with following characters:
a) It is a new undeveloped science where conscious theorizing has gone on for only in the past
100 years.
b) It is primarily a science of observation than experiment while other social sciences are
amendable to experiments. In case of public administration every new policy which is
implemented in it becomes a social experiment.
C) It is a progressive science meaning thereby that its ―generalizations‖ and ―principles‖ are
bound to be constantly revised and restated.
However, there exists a rival group of practitioners who claim that Public Administration is an
Art. The arguments behind their belief are as follows:
 Administration, as has been established over
the years, requires specialized skills and
specialized knowledge and it is not possible
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for everyone to carry out administration just

as it is not possible for everyone to perform
a drama or a dance.
 Administration requires leadership and
conviction, which cannot be taught in a
class.
 It requires a body of special talents in the
field of administration to become a
manager/administrator. For example,
tactfulness, conflict management etc are
such special talents. Amendable
 Success in administration is directly
proportional to the extent of skills applied.
This is supported by the fact that in a group
of 15-20 people only one person turns out to
be a good manager who leads the others.
In the light of the above discussions, the following two conclusions may be arrive at:
A. There are strong reasons to believe that Pubic Administration is both – a ‗Science‖ and
an ―Art‖ i.e. though it can make predictions, the predictions are not absolutely correct. It
also mean that a contingency approach is required in the practice of administration i.e.
there is a need to modify the science of administration to suit the situation and then apply
it. The ability to modify it and to apply it is an art.
B. The word ―Science‖ could be used here in the connotation of a ‗social Science‘. It has
the traits of a science since predictability is there though limited only up to some degree.
Hence one can say that the methodology applied in Public Administration is scientific while its
application is an art.
1.5 Public Administration Vs. Private Administration
The term Public Administration appears to suggest that there must be non-public or private
administration also. Some thinkers believe that all administration is one and there is no
difference between public or private administration. Urwick, Mary Parkor Follet and Henri Fayol
are of this view. They belong to a school of thought which tried to find basic principles of
administration which were equally applicable to public and private administration.
Similarities
The public and private administration shows a number of similarities in practice. We usually say
that all those activities which are performed by the governmental agencies or public agencies
form part of public administration while those performed by the private agencies are called
private administration. There are, however, many activities which are performed both by private
and public agencies. For example, business activities were mainly performed by private
organizations. But, the Government has taken upon itself many economic and business activities,
which hitherto were the preserves of private administration. This has given rise to a new form of
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organization, namely, a public corporation which is very much different from the usual
departmental form of organization prevalent in the Government. This form of organization has
become necessary to provide the public administration sufficient flexibility necessary for running
business enterprises in developing countries the public sector has come to occupy a very
important position in the economic organization of the country. The role of public corporations
has, therefore, gone up tremendously, giving rise to the phenomenon of adopting the business
practices of private organizations in the Government.
There are two different views on the relationship between public and private administration. One
group of thinkers like Urwick L., Mary Parker Follett and Henri Fayol are of the view that
administration is an indivisible entity, and its basic principles are applicable equally to all
organizations whether public or private. This view is obviously based on certain clearly
observable similarities in the practice of public and private administration.
It has also been increasingly realized that there are many skills, techniques and procedures which
are common to both public and private administration. For example, accounting, statistics, office
management, office procedures, purchases, disposals and stocking and many other activities are
common to both public and private administration. In a number of countries several institutions
have come up which attempt to train administrators from public and private administration
together. For example, Administrative Staff College of UK and Hyderabad Staff college of India
have been established to bring about harmony and coordination between public and private
administration. Obviously this is due to the realization of the fact that there is a lot in common
between the public and private administration and both can benefit from each other‘s experience.
In many countries, there has also been a cross movement of functionaries between public and
private administration. For example, in Japan a large number of public servants take up
employment in private industry after seeking premature retirement. Similarly, there is a great
deal of exchange of personnel between public and private sector in United States of America.
Even in India recruitment to public services has been made on an adhoc basis from open market.
This has been done twice since independence in addition to regular recruitment. A large number
of personnel in these special recruitments have been contributed by the private sector. This
would not have been possible if the public sector and the private sector did not have anything in
common. There appears to be a lot of force in the contention of scholars like Urwick and Fayol
that both public and private administration has common techniques. Having said that it must be
admitted that there are some significant differences between the public and private
administration and they cannot be overlooked in any objective study of administration.
Differences
Although the administration of public and private affairs differ at many points and vary in form
and purposes, there are underling similarities in their processes. Among a number of
distinguishing factors/areas between public administration and private business administration,
the following could be considered as the major ones.
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(a) The Political environment: public administration is concerned with the

implementation of decisions made within the political system. In a democratic
system, the policies of the government duly approved by the legislature should
represent the political will of the people, or at least the resultant of the activities of
the various competing political interests in the society. In consequence:
(i) The government creates individual rights and imposes constraints on
individual and group behavior
(ii) The administrator is in frequent contact with his clients and his major concern
is with equity and impartiality
(iii) Administrative procedures are built around strict compliance with the law. On
the other hand, private industry is essentially guided by the principles of profit
maximization and doesn't act as an arbiter between conflicting social interests.
(b) Social costs: public administration decision-making varies from that of private
business in that where private business is primarily concerned with questions of
financial cost and benefit, public administration is intimately concerned with the
concepts of social costs and benefits in addition to those of a mere financial nature.
(c) Public interest: Public administration is often evaluated by the ability to operate in a
manner so as to maximize and integrate the public interest, whereas private business
is evaluated on the basis of profit maximization. In other words, although efficiency
is axiom number one in the value scale of both public and private administration, in
private business it has to do with the minimization of cost and maximization of
profits, while in the context of public administrative system the aims are more
complex to include other concepts like public service, public accountability, and
social responsibility. Therefore, the differing aims require efficiency to be redefined
in connection to public administration. In practice it is much more difficult to
quantify in financial terms the substantial investment of resources undertaken by the
public sector.
(d) Allocation of responsibilities: the method of allocation of functions in the public
sector is often based more on political considerations than pure test of efficiency, as
it would be done in the private sector.
(e) Functions: Public administration is faced with a much wider variety of functions
than those operating in private business, and also deals with matters, which are the
exclusive jurisdictions of central administration such as defense, and law and order.
(f) Decision criteria: Decision-making in public administration is unlike that of a
private organization whose customers are free to take or leave the organization's
products or services. Public administration decision-making is often not based on
commercial forces. Rather, the public, who are in a sense the "customers" of its
services, indicate their interests and views via their political representatives. All
decisions of public administration take place against the background of public
criticism.
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The extent and magnitude of the vice versa influences of the two administrative systems are
quite different. Private administration is highly affected by the decisions, laws, and procedures of
public administration. From the outset, private sector is supposed to fulfill certain requirements
imposed by the government (public sector) before it starts to operate, and to respect and adhere
to public laws. On the contrary, public administration is less likely to be affected by private
administration in the same manner.
Summery for their differences:
 Public closely associated with ‗government organizations‘ often seen as
‗bureaucratic‘
 Private organizations taking speedy action and more effective decisions than their
counterparts in government.
 Public refers to organizations achieving state purposes
 competition is the feature of private organization
 The prime beneficiary of any public organization is the public at large
 Profit is seen as the main motivating force of a private organization and the
entrepreneur is the main beneficiary.
 The public organization is controlled by the parliament and not the profit motive
 Administration in the public sector is much more complicate than in the private
sector. E.g. fair and consistent treatment in the public sector while profitability is the
main criterion in the private sector.
 Public administration(Service delivery, Political process, Legalistic approach,
Bureaucracy, Inefficient, No competition, Social welfare goals etc
 Private administration: Profit motivation, Business activities, Efficient, Free
competition, Individual welfare targets
1.6 The Environment of Public Administration

Environment in the context of this topic refers to actors and forces that affect or determine public
administration. The environment under which public administration operates, that would have
major implications on its success or failure as well as in shaping its basic features, can generally
be classified as internal and external.
Internal environment refers to those conditions, which are in most cases within the control of the
administration, yet having their own challenges and/or advantages. This may include the
organization itself and groups and individuals within the organization, the material, financial,
and other resources available for the organization and so on.
The organizational structure and the pattern of authority in the formal hierarchy, the purpose and
tradition of the organization, historical legacies or traditional practices of the administrative
systems, the internal network and working procedures, etc have influences on the administrative
efficiency and effectiveness of a given organization or country. The behavior and structure of
formal and informal groups like peer groups, labor unions, and advisory council have also strong
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influence on the style of administration. The type and sufficiency of materials, skill, knowledge,
and finance are considered as environmental factors internal to the organization that highly
determines the administrative style and the accompanying success or failure of administration.
External environment on the other hand is that, which is outside the control of the administration
but having major impact in shaping the features and determining the success or failures of the
overall objectives that public administration wants to achieve. The external environment can be
generalized as political, economic/ecological, social, and technological (PEST) each of which
reflected in many ways. For example we can consider:
 Politically, the type of government and the resultant constitution, policies, laws and
directives; national and international political trends and changes; bilateral and
multilateral agreements and policies;
 Economically, national economic trends and level of growth and development; the
global market and economic situation as well as the extent of mutual economic
assistance and cooperation;
 Socially, population/demographic trends and changes; societal beliefs, values, attitudes,
cultures, and lifestyles; public expectations and demands;
 Technologically, ability or access to use the type of technology being used elsewhere in
the world, such as in communication and production;
All these have their own effects on the administrative system of a given country or organization.
Thus, public administration has always to keep on with close scrutiny and be aware of what is
going on or what exists in both the internal and external environment.
As the internal and external environments do have influences on the features, structures and
goals of public administration, there are apparent differences in developed and developing
countries in these regards.
1.7 Public Administration in Developed Countries

In the context of this note, the term "developed" or "industrial" societies refer to those countries
of Western Europe and USA where industrialization has brought about major changes in
economic structure and growth accompanied by political and administrative modernization.
Nevertheless, it should be noted that administrative modernization is a typical or exclusive
feature of developed countries. Because some developed countries might not have modern
administrative system, while we could find a developing country that employs modern
administration.
Despite individual differences, the following are some of the important features of administrative
systems of developed countries as a group that differentiates them from the developing ones:
1. Government organization is highly distinguished and functionally specific and the roles
are based on achievement criteria than on attribute or assumed power. The bureaucracy is
marked by a high degree of specialization. Recruitment of personnel is generally based
on merits.
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2. Laws and political decisions are largely rational. Public policy making is effectively
made by professional public administrators.
3. Administration has become to take all-encompassing functions that affect major spheres
of the lives of citizens.
4. There is high correlation (association) between political power and legitimacy (legality)
and there is an extensive popular interest and involvement in public affairs.
5. Incumbents of political or governmental offices are generally considered as lawful or
reasonable holders of those positions, and transfer of power and positions tend to occur in
accordance with prescribed rules and procedures.
In summary, we can generally say that the nature of public administration of these industrialized
countries can be differentiated from those of the developing ones in structure and function.
Structurally and functionally they tend to resemble to the Weberian model of bureaucracy.
The fact that bureaucracy in these countries exhibits (demonstrate) high degree of
professionalism in turn is the result of various factors like educational background, career
orientation and standards of competence applied in recruitment to the public service. Due to a
relative stability of political systems in these societies, bureaucracy is fully developed with fairly
clear roles and practical acceptance as an autonomous institution. In terms of function,
bureaucracy is primarily involved in rule application, but performing secondary functions of
rulemaking.
Public administration in these countries is more responsive and responsible to the public;
provides efficient and effective public services; performs both routine and welfare tasks. For
such and many other reasons, citizens of the industrial societies often view public administration
as an impartial and expert body of professionals intellectually equipped to cope with their
administrative needs.
In theory, the tasks of public administration in industrial societies do not differ from the
developing ones where the primary task of public administration is to implement public laws and
policies. However, empirical studies proved that features of an administrative system highly
relates to the environment they exist. Therefore, the roles and challenges of public administration
in developed countries have to be viewed in their particular socio-economic and cultural context.
For example, public administration in developed societies is extremely affected by the
development of modern science and technology, and communication networks. Relative
autonomy of institutions in developed countries has also its own (special) administrative
problems, reflected in terms of lack of coherence among numerous service and regulatory
organizations or agencies.
Generally, according to Rumki Basu (1994:43), developed countries (especially in Europe) are
typical examples of what is known as the "administrative state"; and the bureaucracy in these
states mainly perform three types of functions:
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1. Regulatory and preventive functions, enforcing laws, collecting revenue, and protecting
the state against external aggression.
2. Service functions, providing services like education, health, culture and recreation, social
insurance, unemployment relief, housing, transportation, and communication.
3. Entrepreneurial (commercial) functions, operating industrial enterprises, loaning funds
and so forth in order to maintain or increase economic growth and development of their
respective societies.
Public Administration in Developing Countries
Many of the developing countries have got their independency from colonialists immediately
after the Second World War. Despite a wide range of differences in terms of the location,
resources, history, culture, political systems, and development patterns of these countries, they as
a group can be called (characterized) as "developing".
Most of these new self-governing states have been in the process of transitions, facing serious
problems of social turmoil and disturbances, economic depression (downturn) and administrative
chaos (confusions). Yet, a great degree of reliance has been made on the staggering state and
bureaucracy for achieving developmental goals and solving all sorts of social dilemmas and
problems.
These realities have been seriously challenging public administration of developing countries.
The following points are indicative of general administrative patterns currently found in
developing (third world) countries.
1. The basic pattern of public administration is imitative (copied) rather than indigenous
(original). All developing (third world) counties, including those that were not colonized
have deliberately tried to introduce some version or style of the bureaucratic model of
administration from developed countries, most notably from colonial masters. Hence, it
would be predictable for ex-colonies to resemble in terms of their administrative pattern.
2. The bureaucracies are deficient (lacking) in the requisite skills necessary for development
programs. In spite of abundance (plenty) of labor (employable manpower) in relation to
other resources in most of the developing countries, trained administrators with
management capacity, developmental skills, and technical proficiency are extremely in
shortfall.
3. Emphasis to non-productive orientations is another tendency (trend) of the bureaucracies
of these countries. Much bureaucratic activity is channeled towards the realization of
non-developmental goals. According to Riggs, bureaucrats prefer to personal expediency
or convenience as against principled public interest. This in turn may include practices
like:
 Non-merit considerations influence greatly assignments, promotions, dismissals,
and other personnel practices,
 Widespread corruptions,
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 Using the public service as a substitute for a social security program, or to relieve
the problem of unemployment. Thus, there is always a surplus of employees in the
public services,
4. Extensive (huge) discrepancy or disagreement between form and reality, which Riggs has
called it "formalism", is another distinguishing characteristic of administrative trends of
developing countries. In other words, bureaucrats pretend as if they make things they
ought to be done while the reality tells different from what they say.
They try to fill partially the gap between expectation and reality by:
 Enacting laws that cannot be enforced,
 Adopting personnel regulations that are peacefully by-passed,
 Announcing programs for delegation of administrative authority while keeping
tight control over decision-making at the center,
 Reporting as is production targets are met, which in fact remain only partially
fulfilled,
5. The bureaucracy in developing countries is likely to have high degree of operational
autonomy as a result of several operating forces in newly independent states. These
operating forces could be factions created by colonialists within a given country, national
and international organizations etc. Political role of the bureaucracy in these countries
vary significantly.
Regardless of the aforementioned limitations of the current administrative patterns of developing
countries, the immensity of the developmental problems and the urgency to look for solutions
have thrust upon (or forced) the state to bear or shoulder the principal responsibility of achieving
developmental goals.
In other words, despite sever handicaps like shortage of capital, skilled manpower, and lack of
developmental infrastructure that they inherited from colonialists, the Third World governments
are confronted with rising expectations of the people they have to administer. Besides, Third
World governments have been expected to deal with curtailing social dislocations such as mass
rural-urban migration, sever unemployment, riots (social unrest) and community clashes.
With such challenges and confrontations, public administration still becomes the main agency of
socio-economic changes; changes not only in terms of formulating and implementing long-term
plans, but also in the context of establishing modern institutions or organizations equipped with
the necessary skills.
1.7.1 Comparative Public Administration

Nimrod Raphaeli has defined Comparative Public Administration a study of Public
Administration on a comparative basis.
Comparative public administration is defined as the study of administrative systems in a
comparative fashion or the study of public administration in other countries.
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Another definition for "comparative public administration" is the ―quest for patterns and
regularities in administrative action and behavior".
The Comparative Administration Group referred to Comparative Public Administration as the
theory of Public Administration which belongs to diverse cultures in the national settings and the
body of factual data by which it can be expanded and tested.
Comparative Public Administration, in simple terms, refers to a comparative study of
government administrative systems functioning in different countries of the world.
1.7.2 Values of comparative study

The main value of comparative study is to understand ourselves.
The secret of Ethiopian miracle may be revealed when we finally realize that we are Ethiopians,
and ask what we do well and why that works here.
One of the best ways of understanding this is to examine how others approach the same problem,
not that we may copy it, but that by making comparisons, all sorts of implicit and underpinning
cultural assumptions come out of the shadows.
This is as it should be. We should be clear about what we do well, value, and feel we should
preserve. The secret of the Japanese miracle may be that they are Japanese, and facile attempts at
copying deny the reality of a US cultural context.
1.8 Development of Comparative Public Administration
1.8.1 Development of CPA before World War Second

Comparative study of public administration in its rudimentary form evolves at about the 4.B.C.
through the works of Aristotle.
In his curiosity to know what happens in other political systems regarding their laws,
governmental systems and regime types, he wanted to find out perceivable similarities and
differences.
In doing this, Aristotle assembled about 130 different national constitutions and carefully
studied them. His findings produced two major enduring outcomes- namely; one, he was able to
evaluate some governments as good or bad. Two, he categorized political systems into different
classifications as shown below
Aristotle Classificatory Scheme
No of person who rules In whose interest power is exercised
All (collective) Themselves (sectional)
One Monarchy Tyranny Kingship
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Few Aristocracy Oligarchy
Many Polity Democracy or mob rule
Wilson‟s era
Wilson‘s perspective Public Administration has strongly influenced the rest of the world during
the nineteenth century.
Certainly, Wilson was the first administrative thinker who argued that politics and administration
were different functions
His first speech on the techniques of administration was published as an article in Political
Science Quarterly during July, 1987.
May be it was the first known academic publication on the ‗art of administration‘ in a more
technical sense.
In this article he traced the evolution of government through three phases:
 Absolute rule
 Constitutional government
 Administration of constitutional government
Comparative perspective
Woodrow Wilson is who can be credited with introducing comparative study of Public
Administration.
He was the first comparativist, who compared American government system the cabinet system
in United Kingdom to demonstrate that the USA lacked unified authority in several field of
administration
His comparative study was basically concerned with the issues of maintenance of democratic
polity.
The comparative paradigm set by Wilson has the following features:
 The science of administration for United States should be focused from the democratic
point of view
 A good government is synonymous with the practices of Public Administration
 Civic issues were equally significant to those who conduct the everyday affairs of
government
 Administration can be evaluated in its best only by removing the political aspects of
administration
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Marshall E.Dimock criticized that Wilson was unrealistic in saying that the field of business and
there is no scope for politics
In fact the major concern for Wilson was to create a professionally trained, hierarchical
bureaucracy that could be responsible for a unified political system. Such division of politics for
administration is neither good for Public Administration nor can it serve the best interest of
democratic polity.
Comparative study on a small scale began in the nineteenth century. It started with various
reform movements in United States of America
Some important landmarks in these directions were made by the reports of US Senate and
various Commission reports. They are as follows:
 US Senate Report: The Select Committee of the US March 8, 1888
 Additional report of the Select Committee: March 28, 1889
 The Cockery-Cockrell Commission: September 30, 1893
 Committee on Department Methods, (1905-1909)
 Commission on Economy and Efficiency, 1912
 Report of the US Bureau of Efficiency for the period from March 25, 1923 to October
1916
 Joint Committee on Reorganization, 1920
 The reports were mainly concerned only with a limited extent of comparison, that to
within United States federal government agencies
After World War II
Though the efficacy of comparative analysis has been recognized in all the modern social
sciences, the earliest disciplines to take the lead in developing such a perspective were
Anthropology and Sociology.
However, in the case of Comparative Public Administration, because of several environmental
factors, the comparative focus was Slow to develop.
A comparison of administrative systems has had a long tradition. But a focus on this aspect of
administrative studies is about forty years old. Only after the Second World War and with the
emergence of new nations in Asia and Africa, a vigorous interest in comparative studies of
Public Administration has evolved.
Comparative Public Administration has been a recent development in the field of Public
Administration. It was emerged after the Second World War.
It was estimated between 1980 and 1990 that nearly 253 comparative public administration
articles appeared in 20 different journals across the world
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Comparative administration movement has been with developing methods for the scientific study
of public administration
1.9 Factors hampered the development of CPA

Major differences between Western countries and developing countries;
The lack of curriculum on this subfield in public administration programs; and
The lack of success in developing theoretical models which can be scientifically tested.
Contributors for its development
Academic institutions in USA, UK and International Agencies like UNESCO, WHO, ILO, etc.,
have developed significant world programmes in public administration thus enriching the
discipline professionally and academically
Comparative Administration Group (CAP)
1.10 Reasons for the emergence of CPA

1. Pressure of the Global Economy
To allow new institutions into the changed international economic scenario
Exchange of administrative ideas, institutions, and techniques of training, rules and procedures
are something much needed to work within the context of International economic order
World economy has played a crucial role in bringing nations together
Increased awareness of administration across the national can be possible only through
comparison
2. Advancement of Science and Technology
To see the interaction of public administration with a dependent variables mostly societal,
economic, politics, religions, racial, military and other factors peculiar to countries, regions and
areas
3. Because of radical change in administration fashion after WWII in most of the post-
colonial countries
The dysfunctionalties observed in actual working of administration in the Third World made our
research scholars to hunt the different ‗models‘ in comparative study
The basic assumption is that underdevelopment is primarily due to lack of ‗new administration‘
Therefore a special type of administration development administration has become the focal
point of comparative administration are much wider and encompass even development
administration
The quest for comparative administration study resulted in interdisciplinary approach of the
discipline
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4. To overcome the nature of ethnocentric administration practice and culture

To shift from descriptive information case studies to homothetic studies of administration.
Homothetic studies: traditional way of explanations by supported by empirical knowledge of
institutions and dynamics of the society under study.
5. To develop theories for the study of public administration that is truly universal in
scope
Comparative public administration was concerned with the collection of data about public
administration from developed nations.
1.11 Importance of Comparative Analysis

Ideally speaking, an orderly comparison is requisite to the process of systematic explanation
Non-comparative ad hoc description and explanation adds relatively little to the scientific
development of a discipline
One cannot explain a social fact of any complexity except by following its complete
development through a social species (Emile Durkheim). This means a systematic explanation
cannot be thought of without the rigorous use of a comparative approach
Despite some claims to the contrary, does not imply a specific method in social research, but
rather a special focus on cross societal and cross-institutional analysis (Samuel Eisenstadt)
An inquiry may be considered comparative if it is proceeds by use of an analytical scheme
through which different societies may be systematically compared so that, by the use of a single
set of categories, their identities and uniqueness be disclosed and explained (Edward Shills)
The comparative revolution is further serving the purpose of restructuring theoretical constructs
in a more ―Scientific‖ way.
More fundamentally, the comparative perspective is providing a ―basic intellectual outlook that
helps one overcome natural inclinations to view the world through egocentric and ethnocentric
lenses.
It stimulates the process of expanding the universe of social analysis
All the study of administration must be comparative in order to understand the similarities and
differences
By comparing we are importing new ideas and innovations in the areas of public administration
The emergence of comparative administration as an integral part of the study and research in
administration did provide a new style to the totality of the discipline
Comparing and contrasting the administrative set-up in different contexts would help to develop
commonality of public administration
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Comparative analysis as to which important factors help in the promotion of administrative

effectiveness
It can also improve our knowledge of the administrative practices in other countries and to adopt
those practices which can fit in with our own nation and its system
Demerits of Comparative Public Administration
The most fundamental factor limiting the usefulness of comparative study is the fact that
administrative experience of different.
Limitations of comparative methodology
t institutions at cross-national, national, regional and local levels are based upon judgment of
values and cultural bias. The units selected for comparison must have the same conceptual
framework
The levels of comparison must be the same
There should be an agreed definition on the things to be compared
The definition of the focus of inquiry makes analysis more meaningful and useful leading
to generalization
What to compare?
 Comparative public administration studies can compare different types of states at the
same time, such as
Religious states vs. secular states or
Authoritarian states vs. democratic states
 Even though public administration systems vary a great deal, there are some common
elements which they all share which can be compared, such as
The recruitment of bureaucrats and common programs which all
governments have (e.g., a taxation regime) and common roles (e.g., rule-
making).
 The focus is either on the .whole of an administrative system or on its various parts.
Hence, the subject matter of comparison would be one or all of the following
phenomena:
i) Environment of the administrative system.
ii) The whole administrative system.
iii) The formal structure of the administrative system with a focus on the pattern of hierarchy,
division of work, specialization, authority-responsibility network, decentralization, delegation,
control mechanisms, procedures, etc.
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iv) The informal organizational patterns existing in an administrative set-up, including the nature
of human groups, the relationships among individuals, motivational system, the status of morale,
patterns of informal communication and the nature of leadership.
V) The roles of the individuals.
vi) The interaction between the personality of individuals and the organizational system.
vii) The policy and decisional systems of the organization that link its various parts.
viii) The communicational system, which also involves the feedback mechanism.
ix) The performance of an administrative system.
What compare study is not?
It is not
 The search for universal truths, generic culture-neutral models.
 A vehicle to help us to copy
 A country ―A‖ and country ―B‖ type study that simply describes approaches and
practices from place to place apropos of nothing in particular.
 Descriptive; instead it is analytical. Articles about other places do not necessarily
qualify as comparative. We look instead for the analytical underpinnings of
comparison, and the utility of transferring policy and practice across cultures
Levels of Analysis
Comparative administrative studies can be conducted at three analytical levels:
1. Macro
2. Middle-range and
3. Micro
Macro studies
 Focus on the comparisons of whole administrative systems in their proper ecological
contexts.
 For instance, a macro study would involve a Comparison of the administrative
systems of India and Ethiopia
 It will comprise detailed analysis of all important aspects and parts of the
administrative systems of the two nations.
 It will be comprehensive in its scope.
 Studies of macro level are rare
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 Generally, the relationship between an administrative system and its external

environment are highlighted in the macro level studies.
Middle-range studies
 Are on certain important parts of an administrative system that are sufficiently large
in size and scope of functioning.
 For instance, a comparison of the structure of higher bureaucracy of two or more
nations comparison of agricultural administration in two or more countries or a
comparison of' local government in different, countries will form part of middle-
range studies.
Micro studies
 Micro studies relate to comparisons of an individual organization with its
counterparts in other settings.
 A micro study might relate to an analysis of a small part of an administrative system,
such as the recruitment or training system in two pr more administrative organizations
 Micro studies are more feasible to be undertaken and a large number of such studies
have been conducted by scholars of Public Administration
 In the contemporary Comparative Public Administration, all the three types of studies
(micro, middle-range and macro) co-exist.
1.12 Types of Comparative studies

What is the range of comparative administrative studies?
What types of studies are generally included in this realm?
1.12.1 Inter-Institutional Analysis

It involves a comparison of two or more administrative systems. For instance, a comparison of
the structure and working of the Home Ministry of the Government of India with the Defense
Ministry will be a case of inter-institutional analysis. Such comparisons could involve the whole
of an administrative organization or its various parts.
1.12.2 Intra-National Analysis

When an analysis in a comparative perspective is taken up among various administrative systems
functioning within a country, it would be an intra-national analysis.' Comparison of Adama town
administration and Bahir Dar town administration would be an example of such an analysis.
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1.12.3 Cross-National Analysis

When two or more administrative systems (or their parts) are compared in the settings of
different nations, this would be cross-national analysis. For example, comparing the recruitment
of higher civil service of Ethiopia, Kenya and Tanzania will form an example of a cross-national
analysis.
1.12.4 Cross-Cultural Analysis

 A cross-national analysis of administrative system involves countries forming part or
different "cultures", this would be called a cross-cultural analysis.
 For instance, comparing the administrative system of the USSR (a socialist state) with
the U.S.A (a capitalist system) could be termed a cross-cultural analysis.
 Even a comparison between developed country (e.g. France) with a developing
country (e.g. Nigeria) or between developing democratic country (e.4. Philippines)
and a developing Communist regime (e.g. Vietnam) will be covered in a cross-
cultural comparison.
 Thus, the word "cultural" in the category "cross-cultural" has a broad connotation and
involves an aggregation of distinctive political, economic and socio-cultural traits of a
particular system and its environment.
1.12.5 Cross-Temporal Analysis

 Such a comparison involves different time-frames for analysis.
 For instance, a comparison between the administrative system prevailing during Derg
regime and during EPRDF regime would be a cross-temporal analysis.
 Likewise, comparisons, between the administrative systems of ancient Rome and modem
Italy, or between the administrative practices prevailing during the period of Jawaharlal
Nehru and Indira Gandhi would fall under the rubric of cross-temporal analysis.
 A cross-temporal analysis may be inter-institutional, intra-national, cross-national or
cross-cultural. For instance, a comparison of the administrative control mechanisms
prevailing during the times of Julius Caesar, Alexander, Harsha, Attaturk and Nasser will
be cross-national as well as cross-cultural.
 Exactness in cross-temporal studies is not possible because of differences in the nature of
historical sources available for various periods.
 But some broad conclusions on the basis of existing sources can be reached through such
studies.
1.13 Major Areas of Public Administration

There are four major areas for the subject matter of public administration. These are:
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1. Public policy
2. Public Sector Financial Administration(Financial management in government or Public
budgeting)
3. Public Personnel Administration/management
4. Development Administration/management
Note: The first two major areas of public administration will be coved through public policy
making and analysis and development finance course respectively where as public personnel
administration and development administration were included in this reading martial.
Definition of public personnel administration
It seems fair to start with the basic definition of personnel administration. Jucious has given a detailed
definition of personnel administration as ―That field of management which has to do with planning,
organizing, directing, and controlling the functions of procuring, developing, maintaining and utilizing a
labor force such that:
 The objectives for which the company is established are attained economically and
effectively;
 The objectives of all levels of personnel are served to the highest possible degree; (i.e. fair
pay, good working conditions, employees‘ participation in decision making, economic
security and so on) and
 The objectives of the community are duly considered and served.‖
In other words, personnel administration or management is that part of administration concerned with the
management of people at work. So, the central concern of personnel management is the efficient
utilization of employees of an organization. But a public personnel Administration is a broader concept.
Public Personnel Administration like Administrative Theory, Financial Administration, Comparative
Administration, Development Administration and Public Policy Science is an academic branch of Public
Administration. Personnel planning, personnel classification, personnel recruitment, selection and
placement, personnel remuneration, rewards-perks-privileges-benefits and incentives, personnel
promotions-transfers-separations, personnel associations, personnel conduct, discipline and grievance
handling, personal skills, personnel research and international personnel administration are some, but not
all, of the topics which are studied and analyzed in the subject of public personnel administration.
Personnel are a collective term for all of the employees of an organization. The word is of military origin -
the two basic components of a traditional army being material and personnel. It is also commonly used to
refer to the personnel management function or the organizational unit responsible for administering
personnel programs.
Public personnel literally mean the people who work for large organizations which are created by and
meant for the common and ordinary people. These organizations-Departments, Boards, Corporations, etc
are established by the money contributed by the common people and continue to exist to serve these
people. One can call these organizations by the name Government organizations and the people working
in, and for, those as Government servants or Civil servants and the services they render as Civil services
or public services.
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Public personnel administration thus refers to the administration, controlling and management of affairs of
people, line or staff, engaged in civil services. Very briefly here, as details follow, a civil service is a
service which is not military, religious, political and judicial in nature. In other words, public personnel
administration refers to the administration of civil service. It deals with every aspect of officials whether
in ―line‖ or in ―staff‖. It is considered as civil service administration or public service administration.
Staff functions provide advisory, control or support services to the line functions while line functions are
those portions of the organization directly concerned with operations resulting in products or services.
Line authority gives people the right to make decisions regarding their part of the work flow.
The civil service organizations in a country irrespective of political, socio-cultural, economic,
demographic and geographical variations are, in modern times, very big in size and the men and women
working in each of them are more or less numerous and the services they render (from lifting the needle
from the garbage to observing the birth of a new star or death of a black hole in the unfathomable outer
space) are simply uncountable. The study and practice of public personnel administration, therefore,
become very thrilling, challenging and complex.
The ever expanding state functions and an ordinary citizen's conception of the state as a parent figure who
has to provide him everything from cradle to the coffin and solve all his problems definitely require good
governance; and good governance depends upon efficient civil servants.
According to L.D. White, "many elements combine to make good administration: leadership,
organization, finances, morale, methods and procedures, but greater than any of these is manpower. To
find and to hold capable men and women and to help create and maintain working conditions under which
they can do their best is the great tasks of personnel management."
He further emphasizes that, ―At one point or another, however effective personnel management will be
concerned with the question of recruitment, examination, and certification, position classification, pay
policy, assignment of duties, and job supervision; training, especially in-service training and promotion;
service records, discipline and removal, safety and welfare programmes, accident compensation and
retirement or pension; professional and union organization within the public service; moral, prestige, and
the means of creating a career service. Behind these issues, often technical in nature, lie broad problems of
the adjustment of a permanent bureaucracy to political parties, to overhead management, and to the
condition of democratic government.‖
Some of the definitions of public personnel administration are the following:
 O.Glenn Stahl defines public personnel administration as ―the totality of concern with the human
resources of organization.‖ This definition does not clearly indicate the role of the personnel
officer.
 Felix Nigro defines public personnel administration as ―the art of selecting new employees and
making use of old ones in such a manner that the maximum quality and quantity of output and
service are obtained from the working force.‖ This is a bit more specific but like the above it does
not indicate the role of personnel manager.
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 Dimock and Dimock defined public personnel administration as ―the staff function which advises
and facilitates the work of the program manager in matters relating to the recruitment, deployment,
motivation, and training of employees, so as to improve the morale and the effectiveness of the
service.‖
Moreover, Dimock and Dimock stated that public personnel administration is the joint responsibility
of line officials plus staff officials called personnel administrators. Ultimate responsibility rests with
the line officials, but so important is human relations in the modern world that the job could hardly be
done were it not for the special skills brought to it by personnel experts on the staff of the civil service
commissions and in operating departments, commissions, corporations, and independent agencies of
any size. Thus, the core of the study lays in the civil service organizations.
 Goel, S.L. and other defined public personnel administration as ―... branch of public administration
which can help an organization in the management of personnel resources with the use of well
thought out principles, practices and rationalized techniques in selecting, retaining, and developing
personnel for the fulfillment of organizational objectives, systematically and scientifically.‖ It is
the art and science of planning, organizing, implementing and evaluating the personnel resources
in any organization to ensure their best use for the achievement of the objectives, goals and targets
of an organization.
From above definition one can easily conclude that public personnel administration is a branch of public
administration which is concerned with effective management of people at work in government
organizations, institutions and departments. It also refers to civil service administration. It deals with
various problems of the civil service. It aims to solve government employees‘ problems, make them more
satisfied with their working life and make them more effective and efficient and productive so that the
short-term and long term goals and objectives, vision and mission of the organization in particular and
government as a whole are smoothly achieved and are harmonized with individual objectives.
The objective of PPA is the management of human resources in the public sector in which the objectives
of the government machinery are achieved economically and simultaneously the objectives of the
employees are also attained properly (i.e. fair pay, good working conditions, employees participation in
decision making, economic security and so on). Moreover, public personnel administration strives to
satisfy the needs and demands of the community (i.e., provision of proper public service from the public
servants).
The area of public personnel administration is still expanding. Attempts have also been made, "from the
vantage (advantageous) point of the operating official, to understand the psychology and philosophy of
personnel administration as a foundation for dealing with the problems of human relations that are so large
a factor in all administration, public and private alike.
Felix A.Nigro writes, John M.Gaus is reported to have said that the Republic/state/nation is really a
treatise/discourse on personnel administration, concerned as Plato is with a comprehensive plan for
selecting and training the Philosopher Kings. Of course Plato's specific program is impractical for modern
age, but that the "States are as the men are" is just as true today as it was in his time.
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In fact, centuries later the American philosopher, John Dewey wrote, "The state is as its officials are."
Dewey believed, just as did Plato, that public officials could not be "mean, obstinate/fixed, proud, and
stupid, and yet the nature of the state which they serve remain essentially unimpaired." Here is the great
challenge of personnel administration; it deals with the key human element and how to make it equal to
the greatly increasing public-service needs of the people.
1.14 Civil Service Administration (Meaning and Significance of civil Service)

The term civil service is borrowed from the British Administration of India in the mid 19th century and the
term originally describes the selection of civil servants on the basis of merits. Merits imply that
individuals will not be selected and promoted on the basis of political patronage but due to their
qualifications and performance. In the past century the term spread to a number of countries including
Africa following Colonization.
The term civil service is defined in Anglo-American countries as a body of permanent, full time, public
officials in a professional, non- political status, excluding the army forces, the judges (judiciary), the
parliament, and seasonal workers. These people are excluded because they are not permanent. Politicians
are elected by the people but civil servants are elected on the basis of professionalism. These professional
people serve permanently whatever the political party comes into power. In any country whether
developed or not, the reference for civil servant is the merit quality of the professionals and permanent
tenure.
The term civil service is defined in Britain as "those servants of the Crown other than holders of political
or judicial offices, who are employed in a civil capacity, and whose remuneration is paid wholly and
directly out of monies voted by parliament.
The above definition reveals that the term excludes ‗persons in defense forces, persons holding political or
judicial offices, and persons who work for government in an honorary/voluntary /amateur capacity.‘
Civil service implies 'non-combatant branches' of the administrative service of a state. In other words, the
Civil Service is a ―professional body of officials, permanent, paid and skilled.‖ It is thus a body of
administrators that translates law into action. Now a new ‗class‘ has been added to the Civil Service and
this is industrial workers.
Civil Service implies that it is a primarily a body of professional administrators as distinguished from
politicians who are elected on party lines. The officers do not earn profits while in civil service but only
get handsome salaries in fixed grades. They have adopted civil service as their life career and through
training and experience become skilled in their profession.
Herman Finer classified the British Civil Service into three categories:
 Administrative officers discharge the general task of helping in the ‗formulation‘ of policies
and executing them.
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 Technical officials assist in the field of specific scientific areas and training, like doctors and
engineers.
 The manipulative officials execute orders handed down by the first two classes.
The importance of Civil Service in the modern government is well known. As Ogg writes, ―the work of
the government would never be done if there were only the secretaries of state and other heads of
departments, the presidents of board, parliamentary under secretaries, junior lords and civil lords - in other
words, the ministers - to do it. These people cannot be expected to collect taxes, audit accounts; inspect
factories, take censuses, to say nothing of keeping accounts, delivering mail, and carrying messages. Such
manifold/diverse tasks fall, rather, to the body of officials and employees known as the permanent civil
service.... It is this great body of men and women that translates law into action from one end of the
country to the other and brings the National Government into its daily contacts with the rank and file in
country - less in the public eye than the ministry, this army of functionaries is not a bit less necessary to
the realization of the purposes for which government exists.‖
In modern societies, it is in most cases the national government that is now ultimately responsible for the
management of public affairs. In most countries, however, a part of the immediate responsibility is shared
with numerous branches of government at regional, district, municipal and village levels, and also with
various bodies established to provide particular services. Another set of institutions playing a part in the
administration of public affairs consists of associations, societies and unions formed by private citizens,
including state employees in their personal capacity. Then it is the civil service who takes a considerable
portion of government today.
A civil servant is one whose main function is to administer the law of the land. This implies that the basic
task of the civil servants is to transform politics into action. Besides, the higher echelons of the civil
service assist their political superiors in policy-formulation through expertise advice, assistance, and
information. In other words, the higher administrative staff is directly connected with the political head of
the department. On the other hand, the lower clerical staff helps the administrative staff and works under
its direct supervision and control.
With the diversification of the nature of the civil service personnel, civil servants of the technical category
engaged in various productive and public sector organizations are rendering useful social and economic
services to the people. State reaches the citizen through the civil servants who are trained, skilled and
permanent body of professional officials, who have adopted government service as a career.
Despite there have been historical traces for the existence of some sort of a rudimentary civil service, for
example in ancient china and Egypt, concept of civil service as a career is comparatively a recent origin
even in those developed countries. England had no permanent civil service until the middle of the 19th
century and USA until the end of that century. The "patronage system" and the "spoils system" that
prevailed in England and the USA respectively have delayed the development of a merit-based public
career system until those mentioned periods.
According to Dr. Finer, the growth of the cardinal principles of modern civilization brought about the
establishment and growth of a professional civil service. Some of those principles were the principles of
specialization and division of labor, the democratic ideas of "career open to talents", etc.
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The Civil service is thus the chief instrument for the implementation of the will of the state as expressed
through public policy. It is indispensable to the functioning of the modern state. With the change in the
philosophy of the state from the laissez faire to that of the social welfare, the modern state involved itself
in multifarious/diverse tasks, which are performed by the civil service.
Therefore, the tasks of the civil servants became comprehensive, directly impinging/imposing on the lives
and welfare of citizens. Due to the increasing significance of the civil service in modern societies and the
assumption of responsibility by the state for the performance of various socioeconomic functions, it has
become necessary or imperative to recruit persons and thereby build competence for the civil service.
1.14.1 Basic Features of Civil Service

In the words of Gladden ―the requirements of the civil service are that it shall be impartially selected,
administratively competent, politically neutral and imbued/filled with the sprit of service to the
community.‖
The basic features of the civil service worth mentioning are as follows:
a) Professionals:
The most important characteristic of civil service is that it is a professional class of officials who are
trained and skilled. Like other people who carry on different professions, the profession of civil
servants is to run the administration. It does not mean, however, that civil service is a single profession
like shoe-making or welding but it is a sum total of many professions from delivering mail to citizens
to administering a district - all engaged in a single aim, i.e. the implementation of state policy.
b) Hierarchy:
By hierarchy we mean that all the civil servants are organized into a firmly ordered system wherein
each one is subordinate to the other, higher to himself and there is supervision of the lower offices by
the higher ones. In this hierarchy, each officer occupies a fixed place with well-defined duties, salary
and privileges. The person at the lowest rung/step of the ladder is ultimately responsible to the one at
the highest ladder through a well organized chain. Every official has to obey the orders of the higher
official.
c) Bureaucracy:
The word ‗bureaucracy‘ is sometimes used with contempt/hatred/dislike. The civil servants through
distortion and caricature/false impression are sometimes termed as bureaucrats. Politicians and public
men hurl/throw abuses at them at the time of election and other emergency. They associate
bureaucracy with red-tape, officiousness, corruption, inefficiency, wastefulness and what not. But to
caricature/sketch the civil servants in such a way is wrong.
The existence of civil servants as a professional class is essential for the present-day civilization.
Rightly understood, bureaucracy is a professional class of technically skilled persons, who are
organized in a hierarchy way, and serve the state in impartial way. They administer on the basis of
rules and regulations rather than on grounds of favoritism. Their treatment with the public is uniform.
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Although civil servants cannot be blamed for the law and policy of the legislature and executive, yet it
does not mean that they are quite unresponsive to public opinion. In the modern welfare state the civil
servants have to seek to co-operation of the public and come in contact with them in order to succeed
in the implementation of the plan of the government. It is for the purpose of knowing the interests and
views of the public and also to inform the public of their program and policies that the modern
governments maintain a Department of Information.
It is the duty of the civil servants to show courtesy to the public and make such a psychological
approach as to avoid or at least minimize frictions. They are the servants of the people whose welfare
and happiness they should place above their private gain. They should approach them as friends and
guide rather than as rulers equipped with authority.
d) Impartiality and Anonymity:
The civil servants have to apply the laws of the State without showing any favour or partiality to any
individual or group of individuals in society. They should be neutral in politics and serve the
government without caring for the party character of the cabinet. They are servants of the State and
they have to serve any party that is in power.
In the words of Gladden, ―The concept of a civil service, a professional body of neutral experts in
administration dedicated to serve the nation irrespective of their own gain and without reference to
party political views or class interests, is thus a modern one.‖ And for this very reason, they must work
without any desire for fame or name. They have to remain anonymous, whatever praise or blame will
go to the minister. Thus they should maintain a high standard of conduct and serve the nation
impartially, honestly and anonymously.
Referring about the features of Civil Service, Herman Finer has stated the following characteristics.
 First, the civil service ... does not exist to make a profit. Hence its members‟ incentive is, in the
last resort, to draw a salary, and not, by taking risks to make a lot of money.
 Secondly, it is public. Hence its actions are subject to persistent scrutiny and liable to
disavowal/rejection. This again limits its flexibility and enterprise.
 Thirdly... civil servants and their ministers must face constant informed criticism from
Parliament. This fortifies/strengthens their unreadiness to take chances.
 Finally, its services are vital. This forces it to pay special care to its staff relations, and, in order to
prevent disaffection of dispute, to cultivate equality of treatment at the possible expense of
quality service.
1.14.2 Roles and functions of civil service
1.14.2.1 Roles
The best - administered „state‟ has the best-organized bureaucracy. The famous dictum/saying of
Alexander Pope, “For forms of Government let fools contest, whatever is administered best”, has
become more applicable to the modern age in which administration has assumed greater importance.
In any state, today, efficiency and smooth conduct of administration mostly depend on the permanent
civil service, which operates as the permanent branch of executive. Contrary to a Minister, a civil servant
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is an expert, non political and efficient person who spends several years in a department. (i.e. the
Ministers, being political and temporary persons).
Ministers depend up on their permanent secretaries who are mostly accepted by the Ministers and a
Minister ―in ninety-nine cases out of hundred simply accepts their views and signs his name in the dotted
line.‖ Due to this excessive reliance of the Ministers on their Secretaries, it is remarked that the
―Parliament is a tool in the hands of Ministers and the Minister is the tool in hands of the Permanent
Officials.‖
Civil service has indispensable role to play in the modern state. The role of the civil service can be
understood by discussing various functions performed by it, in the following areas of administration,
legislation, and finance.
1. Administrative Role
Civil Service plays very important role in administration. In a parliamentary form of
Government, the ministers are elected representatives and not experts and hence they look towards
civil servants for guidance. Most of the general policies formulated by the Cabinet are in fact evolved
in detail by the civil servants. The civil servants remain in the office for a long period of time and as
such they possess greater knowledge and experience in administration. They submit the much
needed data and facts to the Ministers.
One of the important functions of the „administrators‟ is to collect all materials and submit to
the Ministers to facilitate a correct decision. Furthermore, once a policy had been decided, it is left
to the civil servants to execute it.
The Ministers in democracies have no time to look to the daily routine of their departments because
they devote much of their time by participating in the activities of the Cabinet, Parliament, party
and other social engagements; and thus they have little time to learn about administration.
Ministers are laymen and as such they have to depend up on the civil servants. The replies to the
‗questions‘ and the ‗contents‘ of the speeches of the Ministers are prepared by the concerned civil
servants. Thus, the civil servants exercise effective power in administration both at the level of
policy formulation as well as its execution.
2. Legislative Role
There is incredible influence of civil service in the field of legislation. The „bills‟ introduced by
Legislature are prepared and framed by the civil servants. In a parliamentary government, a
minister is a new to a department/office, and thus it is not possible for him to know the details of the
working of the department/office and the new policies required for the department/office.
―Only experts can fit the new policy into the old administration; and the permanent official may often
have to suggest to the political Minister what can and what can not be done, as well as how to do and
what can be done. Thus new policy is very often the actual product, and still more often the result of
corrections and suggestions of the permanent civil servants.‖
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The power of civil service in the fields of legislation has been enhanced because of the growing
pressure of business in the modern legislation. Parliaments have not the time and they have not the
competence to deal with technical issues.
3.Financial role
In the modern democracies, it is the legislature that controls the public finance. But it must be
conceded/approved that civil service exercise extensive influence in the field of managing the
financial affairs of the country. The budget, in practice is prepared by the civil servants, at various
levels of the governmental organizations. Not only this, but even the expenditures are drawn by
respective departments.
The treasury experts exert influence upon the concerned Ministers and play a crucial role in
devising what new taxes are to be levied and what procedures to be adopted for the collection of
revenue.
1.14.2 Functions
It is not easy to draw a sharp distinction between the functions of the political executive and the civil
service. Many policy decisions which are approved by the political command are practically formulated
by the civil servants.
Nevertheless there is a difference in the nature of the two operations. The political executive has the
unique and exclusive duty of taking responsibility for policy. In contrast, the main function of the civil
service is to operate the administrative machine in accordance with the policy established by the
political executive.
In general, its functions of the civil service may be divided into the following categories:
i) Advice:
One of the primary functions of civil service is to offer advice to the political executive. Ministers
rely on the advice of their senior officials who are the reservoirs/tank/pool of information and
organized knowledge concerning the subject-matters which they administer.
The political executive necessarily depends upon the civil personnel for the information that he needs
in formulating his own program. In the course of administration many problems arise which are
usually worked out in the first instance by the civil service and then reported to the political
overhead, it at all, for approval or merely for information.
Ramsay Muir has stated this function of rendering advice to the minister in an emphatic/vigorous
though exaggerated style. He observes:
―He (the minister) has obtained this position because of his achievements in the
general fields of politics. In a majority of cases he has no special knowledge of the
immense and complex work of the department over which he is to preside....He has to
deal with a body of officials who have been giving their whole time in quietness to the
study of the problems of the office, during the years when he has been making his
position in the world, or talking fluently on platforms. They bring before him hundreds
of knotty/difficult problems for his decision about most of which he knows nothing at
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all. They put before him their suggestions, supported by what may seem the most
convincing arguments and facts.
Is it not obvious that, unless he is either a self-important ass or a man of quite

exceptional grasp, power and courage he will in ninety-nine cases out of a hundred,
simply accept their view, and sign his name on the dotted line? ....the policy of the
office will nearly always prevail: its power of quiet persistence and of quiet obstruction,
and its command of all the facts, is irresistible except to a man of commanding power.‖
The underlying significance and philosophy of this function of advice is made evident in the following
passage:
―The business of government, if it is to be well done, calls for the steady/stable
application of long and wide views to complex problems; for the pursuit, as regards
each and every subject-matter, of definite lines of action, mutually consistent,
conformed to public opinion and capable of being followed continuously while
conditions so permit and of being readily adjusted when they do not.
Almost any administrative decision may be expected to have consequences which will endure
or emerge long after the period of office of the government by which or under whose
authority it is taken. It is the peculiar function of the civil service; in their day-to-day work to
set these wider and more enduring considerations against the exigencies/emergency/demand of
the moment, in order that the parliamentary convenience of today may not become the
parliamentary embarrassment/humiliation of tomorrow. This is the primary justification
of a permanent administrative service.”
Sir Josiah Stamp observed, ―I am quite clear in my mind that the official must be the mainspring of the
new society, suggesting, promoting and advising at every stage.‖
However, the extent of influence of the civil services over ministers depends upon four factors, viz.
/namely,
a) The influence of civil service is more on the newly appointed ministers than on the senior
ministers.
b) A civil servant fully conversant with his job is in a better position to exercise influence over
the ministers.
c) It depends up on the type of party in power as well. If a conservative party wedded to the
philosophy of status quo comes in power the civil services will perform only regulative
functions. If a radical party pledged to social revolution comes in power, civil services will
have to be more active and enterprising.
d) The competence of the minister also matters. A competent minister will assert whereas
incompetent one will toe the line of the Secretary.
ii) Program and operational planning:
In its broad sense, planning is a responsibility of the political executive. For instance:
 Planning the periodic adjustments of the revenue structure is a responsibility of the Minister
for Finance,
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 Agricultural price and food policy is a function of the Minister for Food and Agriculture,
 Industrial policy is a function of the Minister for Industries and so on.
But there is a field wherein civil servants also perform the function of planning, and this is the field
of program planning.
As we know, the legislature passes (to draw a framework for the implementation of policy) an Act in
general terms to execute and implement which certain rules and regulations are required. The civil
servants, who put that law into execution, determine the specific steps to be taken in order to bring
to fruition/completion/end a policy or a law already agreed up on.
Program planning may actually affect policy through in principle its purpose is merely to affect
policy. It involves a detailed study of the job to be done. It is the visualization of the whole
operation. The success of any new policy will depend ultimately upon good program planning.
Besides, assisting the ministers in the formulation of policy and drawing a framework of plan, the civil
services are required to participate in the execution of plan. This is termed as operational planning.
iii) Production:
Civil Service exists to perform services in the broadest sense of the term. Its primary purpose is
production. Things produced may be tangible objects such as kilograms of fertilizers and miles of
concrete roadway or less tangible such as cases of legal disputes decided or school children
educated.
Every official responsible for running administration needs work standards to enable him to
determine whether his organization is reasonably effective, whether his subordinate employees are
competent and whether levels of efficiency and output are rising or falling. He is to secure the most
effective utilization of personnel, both with regard to immediate assignments and to ultimate potential.
He also supervises his subordinate employees. Supervision is an extremely difficult and delicate task.
The immediate test of success is production. The supervisor must cultivate attitudes that are conducive
to co-operation, energy and loyalty.
iv.Delegated Legislative Powers:
Due to the emergence of the welfare states, the activities of the State have got multiplied. The
Legislature is neither competent nor has the time to cope with enormous and complex legislation
which has consequently grown up. Hence it delegates power of making laws to the executive. It
passes the bills in skeleton from leaving the details for the executive to fill. This job is evidently
performed by the permanent heads of the departments.
An important point worth mentioning here is the growth of „delegated legislation‟ in recent times in
British Constitution. Parliament passes only broad Acts and details are assigned to be filled up by the
executive. Most of the rules and regulations or statutory orders are framed by the departments headed
by civil servants, and such rules are made in the name of the Ministers but actually the civil servants
frame it.
iv) Administrative Adjudicatory Power:
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This is another important power which has been entrusted to the executive due to rapid technological
developments and the emergence of the welfare concept of the State. Administrative Adjudication
means vesting judicial and quasi-judicial powers with an administrative department or agency.
The aggrieved party is free to approach to the court of law against the decision of the department. This
is otherwise known as ―Administrative Justice‖ or ―Administrative adjudication‖. In the British
system, departments are also empowered to decide disputes arising under administrative rules and
orders.
v) Organization and Methods:
An important function of the civil services particularly of middle management is to bring about
improvement of the working methods so as to eliminate waste and loss of effort and secure the
most complete utilization of available resources. This function is performed with the assistance of
units specialized in what has come to be known as organization and methods work.
From what has been said above it is clear that civil servants play an important role in a modern state.
1.14.3 Modern Trends in Civil Service
Many trends have been indicated from time to time, but five main trends are common in the civil
services of many countries today. These are:
 Growth in numerical strength;

 Growing diversification because of complex nature of functions and obligations;
 Rise in the powers;
 From negative to positive approach; and
 Change in the concept of civil service neutrality.
i. Growth in numerical strength:
Parkinson's Law or the Rising pyramids of Bureaucrats have been vindicated/correct. Today the
size of Civil Service in every country of the world has gone up tremendously. There has been
rapid increase because of many reasons; the greatest being the rise in functions of modern welfare
states.
Rapid growth in the size of the public sector became noticeable in the 1960s in Africa. Evidence of
this growth is demonstrated by the:
 Range of institutions;
 Number of officials employed and
 Expenditure allocated to the institutions.
Institutional expansion is an indicator of bureaucratic growth during the post independence
period of newly independent states of Africa. For example:
 In Tanzania, the number of ministries increased from 10 in 1961 to 16 in 1985.
 In Nigeria, the number of statutory corporations and State owned companies rose from a
mere 50 in 1960 to 800 in 1982.
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Corresponding to the increase in the number of government agencies is the growth in public
sector employment.
 Kenya‘s public service employed 45,000 persons in the mid-1950s, 63,000 in 1965, 84, 500
in 1971 and 170, 000 by 1980.
 The Senegalese government employed 10,000 shortly before independence in 1960, 35,000
in 1965 and 61,000 by 1973.
As is to be expected, the rapid expansion in public service institutions and workforce has translated
into huge increases in expenditure. In most cases, the wage bill constituted a significant portion of
total outlays.
In the early 1970s, Uganda‘s wage bill stood 40 percent of recurrent expenditure.
ii. Appointment of Specialists:
Because of complex nature of the functions of the modern government, there has been a „growing
diversification in the composition of the public service by the employment of more and more
specialists, technicians and experts.‘
The governments no longer employs only generalists and clerk; on the contrary it is increasingly
employing more and more specialists such as scientists, doctors, engineers, psychologists,
psychiatrists, agronomists, meteorologist, economists, statisticians, jurists, educationists to
discharge various specialist and technical services.
iii. Rise in the powers /enhanced powers:
There has been tremendous growth in the powers, functions and also the influence of the Civil
Service during recent past and particularly after the Second World War.
The civil service has become the most vital and potent/strong element in modern government. The
power of the permanent Civil Services is to be found not only in administration, but also in legislation
and finance; it not only administers the laws, it largely shapes them; it not only spends the proceeds
of taxation, it largely decides how much is to be raised and how.
iv. From negative to positive approach:

Now the traditional negative approach has given place to a positive one. The concept of the civil
service during 19th century was negative. Today a more positive theory of personnel administration
has been involved which believes in ‗creating positive motivation among officials which would
enable them to give in their best to the public service. The aim is to make public official competent,
loyal, satisfied and interested. A new type of administrator is called for if our planning is to be a
success.‘
A civil servant is expected to be dynamic, cooperative and not only a file-oriented official.
v. Change in the concept of civil service neutrality:

Neutrality has been the traditional virtues/qualities of civil service. The main attributes of the
British concept of Civil Service neutrality are cited as:
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a) Public confidence in the freedom of the Civil Service from all political bias;
b) Ministers‘ confidence in obtaining loyal service from the civil servants irrespective of what
political party is in power;
c) High staff morale based on confidence that promotions and other rewards do not depend
up on political origins or partisan activity but on merit alone.
The American concept of Civil Service neutrality, as pointed out by the Hoover Commission, is:
―They (Civil Servants) should keep clear of all political activity, preserve their neutrality in
matters of policies....This means that they must avoid such emotional attachment to the
policies of any administration that they can not accept change and work in harmony with new
leaders....
Senior Civil Servants would necessarily refrain from all political activities that would affect
adversely their ability to perform their official duties fairly, or that would tend to identify them
personally with a political party or its public policies. The senior Civil Servants should make no
public or private statements to the press except of a purely formal nature. He should make no
public speeches of political or controversial character.‖
The traditional concept of neutrality has been opposed on many grounds. These are:
a) The concept is based on a belief in "politics, administration dichotomy." Today the idea of
ministers framing policies and the civil servants just executing them does not hold good,
because the role of the Civil Service has been changing from being a mere agent of the
political executive to ‗that of collaboration‟ with it. Today, policy formulation is an all-
pervasive process and a „co-operative‟ endeavor, in which the civil servants play pivotal
role.
b) The traditional concept of neutrality is based on ‗confusion between party politics and
policy politics.‟ Party politics should be eschewed/avoided at all costs by the public
officials, but not policy politics.
As Appleby has correctly point out, all administration today is political since it must be responsive
to the public interest. One of the important duties of modern public official is to win public approval
of the government policies and secure their cooperation in their implementation. ―Public
Administration is not something set apart from, but is an integral part of the whole system of popular
government and; democratic ideals.‖
c) Today, the role of Civil Servant has undergone change because of a shift in the purpose of
the State. Every modern State is busy in creating a welfare society, and in under
developed countries it entails planned effort.
―The successful carrying out of tasks of both types - development and democratization requires on
the part of administrators not only qualities of initiative, leadership and taking of responsibility,
but also an emotional and intellectual integration into what may be called democratic social
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values.‖ It is opined that such function can not be well performed by officials who are only hard
working, procedure-minded, impartial and honest and something more is required to implement the
programs vigorously. This requires “a sense of emotional integration with the policies and
programs and identification with interests of the common man.‖ Today a ‗neutral‘ Civil Service
will fail to achieve results.
A government staffed with people who „avoided emotional attachment‟ would be like a hospital full
of doctors and nurses who did not care whether their patients lived or died, just so that proper
professional procedures were followed.
The most important aspects of Civil Service neutrality, which deserves weightage here is the position
in respect of political activities by civil servants. The problem requires solution by striking a
balance between two conflicting interests:
 In a democratic society it is desirable for all citizens to have a voice in the affairs of the
State and for as many as possible to play an active part in public life, and
 The public interest demands the maintenance of political impartiality in the Civil
Service and of confidence in that impartiality as an essential part of the structure of
Government.
1.15 Evolution of Public Personnel Management in United States And Developing Countries
United States
Public personnel management in the United States is complex, because there are many governments
(national, state, and local), each with its own personnel system. But there is general agreement that the
development of public personnel management has proceeded according to an evolutionary pattern.
First, public jobs were allocated primarily among elite leaders — the small group of upper-class property
owners who had led the fight for independence and established our national government.
Next, the emergence of political parties created a patronage system that rewarded party members and
campaign workers with jobs, once their candidate was elected.
While patronage system did not necessarily result in the selection of highly qualified employees, the
patronage system does have virtues.
 It enables elected officials to achieve political objectives by placing loyal supporters in key
positions in administrative agencies.
 It increases political responsiveness, because elected officials get re-elected by providing
voters with access to bureaucrats who often don‘t seem to understand that rules must
sometimes be bent or broken for voters to feel that justice has been done.
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Third, civil service reformers forced a gradual transition from patronage to merit systems. They
emphasized the civil service ideal that a competent, committed workforce of career civil servants is
essential to the professional conduct of the public‘s business.
For example, position classification enhances efficiency and budget transparency. It offers
management
 a uniform basis for grouping jobs by occupational type and skill level,
 an equitable and logical pay plan based on the competencies needed to perform a job, and
 a way to translate individual pay and benefit costs into agency budget projections.
 protects employee rights by minimizing political interference or administrative abuse.
The relationship between politics and administration centers around the enduring question of how
governments can bring expertise to bear on public policy development and implementation while
retaining the supremacy of political values.
The civil service model viewed personnel management as a neutral administrative function; the
effectiveness model viewed it as a management oriented function under the direction of the
executive branch.
The emergence of a hybrid of politics and civil service created strains in the civil service reform
model of public personnel management, which had been based on the fundamental distinction
between politics and administration.
Fifth, during the 1960s and 1970s, public sector collective bargaining came to the fore/front. Under
collective bargaining, the terms and conditions of employment are set by direct contract negotiations
between agency management and unions.
Collective bargaining is in contrast to the patronage system, where they are set and operationally
influenced by elected officials, or the civil service system, where they are set by law and regulations
issued by management and administered by management or an outside authority, like a civil service
board.
Public sector collective bargaining has much in common with its private sector counterpart, such as
contract negotiations and grievance procedures. But fundamental differences in law and power
outweigh/offset/overshadow these similarities. The ultimate authority to approve or disapprove
negotiated contracts lies not with workers and management, but with legislatures (such as the city
council, school board, or state legislature), because these are policymaking bodies with the authority to
appropriate money to fund contracts.
During this same period, affirmative action emerged to represent social equity through voluntary or
court-mandated recruitment and selection practices. It was supported by the fundamental beliefs
that a proportionately representative bureaucracy was essential for the government to function as a
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democracy; and that other personnel systems had worked (albeit for different reasons) to perpetuate
the dominance of white males.
State and federal administrative agencies, which are responsible for monitoring compliance with
affirmative action laws, control affirmative action systems by public agencies or contractors. If
compliance through voluntary affirmative programs is not effective, members of the affected class
may sue the agency to force it to take affirmative action in the selection or retention of women or
minority group members. If successful, these court efforts may result in considerable judicial control
of the agency‟s personnel system.
The court can require an agency to hire or promote specific numbers or percentages of
underutilized groups (qualified females or minority group members), until their representation in
the agency workforce is more proportionate with their share of the labor market.
Because courts have ultimate authority to adjudicate/arbitrate conflicts within our political system,
they effectively influence how the other three public personnel systems operate.
 They can discourage avoidance of affirmative action compliance by requiring agencies to

justify the transfer of positions to political patronage systems.
 They can order the abandonment of civil service rules or techniques that have a disparate
effect on women and minorities; and
 They can abrogate collective bargaining agreements that use seniority rules to perpetuate
previous patterns of racism or sexism.
Sixth, the antigovernment values and systems that have emerged in developed countries since the
1970s clearly reflect the growing importance of market models and the private sector in achieving
public policy objectives. Historically, it was taken for granted that career civil service employees
would staff public programs, working for public agencies budgeted with appropriated funds.
Today, most new public programs are likely to be carried out by alternative market mechanisms
rather than directly by public agencies. When public agencies are used, they are likely to be staffed by
temporary employees hired through flexible employment mechanisms rather than permanent
employees protected by civil service regulations and collective bargaining agreements.
1.16 Evolution of public personnel systems and values in the United States
Stage Dominant Values Dominant Systems Pressures for change
One (1789-1828)Responsiveness Elite Leadership Political parties +
Patronage
Two (to 1883) Responsiveness Patronage Modernization+
Democratization
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Three (to 1933) Efficiency+ Civil Service Responsiveness+
Individual Rights Effective Government
Four (to 1964) Responsiveness+ Patronage+ Individual Rights+
Efficiency+ Civil Service Social Equity
Individual Rights
Five (to 1980) Responsiveness+ Patronage+ Dynamic equilibrium among
Efficiency+ Civil Service+ four competing values
Individual Rights+ Collective bargaining+ and systems
Social equity Affirmative action
Six (now) Responsiveness+ Patronage+ Dynamic equilibrium

among four pro
Efficiency+ Civil Service+ governmental values and
Individual Accountability+
Collective bargaining+ systems, and three anti-
government values and
Limited Government+ Affirmative action+ systems
Responsibility Alternate organizations
and mechanisms+
Flexible employment
relationships
Developing Countries
Developing countries today face many of the same challenges in their personnel systems as the United
States once faced. The process of modernizing public management appears to be relatively uniform,
because pressures for modernization and democratization tend to parallel, though lag behind, those in the
Western world; administrative reforms are introduced by Western consultants; and Western lenders often
mandate administrative reforms as a condition of continued credit.
In the first stage, the elite leaders of successful independence movements establish new nations.
The transition to a second stage (patronage) follows, as these emergent nations strive to strengthen the
conditions in civil society that underlie effective government (such as education, political participation,
economic growth, and social justice) by refining their constitutions, developing political parties, and
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creating public agencies. This transition is often difficult. Arbitrary post-colonial boundaries, internal
ethnic conflicts, and centralized authoritarian leadership patronage (even given its drawbacks) may
prevent efforts to build a stable party system.
The third stage, if it occurs, is a transition from patronage to merit systems, marked by passage of a civil
service law, creation of a civil service agency, and development of personnel policies and procedures.
It happens due to internal pressures for efficiency (modernization) and human rights (democratization).
Often, international lenders and donor governments add external pressures that emphasize government
capacity, transparency, and citizen participation. Again, this transition may be difficult. Governments
may be large or inefficient due to socialist traditions favoring public control of agencies (such as
railroads, airlines, mining and petroleum, banking, health and hospitals, and insurance).
Pressures for transparent, honest and efficient government may be thwarted by corruption, use of the
public sector as the employer of last resort, or a “brain drain” to the private sector because of an
underpaid, poorly qualified and politically vulnerable civil service.
Developing countries that lack a strong cultural tradition of the “public interest,” the rule of law or a
professional public service may also suffer from administrative formalism: laws, agencies, and practices
that look fine ―on paper‖ may not function well in reality
In countries plagued by class barriers or high underemployment, pressures for employee rights or
equal employment of minorities, women, or persons with disabilities are not likely to significantly
affect personnel policy or practice.
If, and when, the transition to civil service occurs, developing countries then seek to balance
conflicting values and personnel systems to achieve the contradictory objectives that characterize the
fourth-stage public personnel management.
For example, they must establish an optimum level of public employment; maintain administrative
efficiency and protect public employee rights; and achieve both uniformity and flexibility of personnel
policies and procedures. Colonial traditions and current political pressures tend to produce centralized
political and economic systems.
As a result, over rigidity and uniformity outweigh administrative flexibility and diversity. ―Neo-
liberal‖ economic policies (imposed by international lenders to promote economic development by
reducing public expenditures and external debt) lead to layoffs and divestiture of state agencies.
While these policies do reduce external debt by cutting public employment and expenditures, they
may also increase unemployment, social injustice, and popular discontent with elected leaders or
the entire political system. This, in turn, further undermines civil society and the rule of law.
1.17 Evolution of public personnel in Developing Countries
No Stage Dominant Values Dominant Systems Pressures for change
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1 one Responsiveness Elite Leadership Political parties +
Patronage
2 Two Responsiveness Patronage Modernization+
Democratization
3 Three Efficiency+ Civil Service+ Responsiveness+
Individual Rights Patronage Effective Government
4 Four Responsiveness+ Patronage+ Dynamic equilibrium among all competing
Efficiency+ Civil Service+
Limited Government Collective bargaining+ values and systems
Privatization
1.18 Tenure System
One of the most important problems of personnel organization is that of tenure/term/duration by which
civil servants will hold office. At present there are three tenure systems, i.e.,
a) Tenure at the will of appointing officer;

b) Tenure for a fixed number of years; and
c) Tenure during good behaviour or life tenure.
The question is as to which of the three tenures shall be employed for civil servants.
Tenure at the will of appointing officer
It is a system in which the term by which individuals will hold office will be determined by the appointing
officer. It is the system which is almost universally found in private undertakings where conditions differ
radically from those obtaining in government undertakings. In the former the proprietors/owners or the
managers are not the representatives of any outside interest but their whole interest is in having the work
prosecuted with utmost economy and efficiency; while in the latter the managing heads are not directly
interested in the financial results secured.
This system does not suit the administrative services. It would cause severe hardship to the employees by
unjust dismissals and also create instability and inefficiency in administration. It seems that for employees
to work with a high sense of independence and impartiality, it is essential that they must be guaranteed a
permanent and sufficiently long tenure.
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Tenure for a fixed term
In this system the term will be fixed (i.e., tenure for a fixed number of years). It suits only the offices of
political nature, but does not suit the administrative class because short terms, say four, five or seven
years, can neither provide capable persons nor provide any opportunity for specialization and experience.
About the time officers and employees have thoroughly learned the duties of their positions and have
acquired proficiency in their performance, they fill drop out and their places will be taken by new and
talented employees.
Moreover, the system would make public office political 'spoils' to be appropriated by the party victorious
at the polls as it happens in America where many of the officers and employees are appointed both by the
national government and state governments for four years' term as corresponding with the term of office
of the President with the result that every change in American Presidency brings a change in officials and
employees.
Tenure during good behaviour or life tenure
The third system, i.e., tenure during good behaviour should be applied to the administrative services. This
system will secure efficiency in administration by making the office permanent and continuous. It makes
government service a permanent career, a profession which capable men/women would choose.
1.19 Government Service as a Career
One of the important foundations of public personnel administration is the extent to which government
service can be presented as a life career.
A paramount objective is to create a true career system, as against simply recruiting to fill individual jobs.
In such a career service, the recruits, whether fresh from college or already possessing some work
experience, would be guaranteed the opportunity to move up the line as they demonstrate their capacity.
Ultimately, the best of them would fill the highest-ranking positions. They would have every inducement
to continue in the government service, instead of leaving after a few years because of the lack of a planned
system of career development for them. Thus it is highly essential to study the career systems as a
precondition to the personnel/ resource management.
This part deals with various career systems, foundation and role of career service in even general
administration.
A) Meaning
Career is an old term and has been used to imply the advancement of an individual in the field of work
throughout his life. According to stahl," A career in business or in a profession is a commonly
understood concept. Sometimes it means devotion to a specialty, sometimes it means a series of
employments which are only loosely related to each other. In either case, it usually implies some
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degree of success. Career is a pleasant term. It is some thing that every one who expects to work for a
living would like to love"
Career civil service has been understood as a system aimed at recruiting young people having the
talent and ambition, with capacity for learning and growth, training them in order to develop their
potentialities for the service of the state.
Pointing out the wide-circulation of the term career in U.S.A, L.D. White comments, "In December
1933, the Social Science Research Council appointed a commission of inquiry on public Service
personnel. The report of this distinguished unofficial body gave popular currency to the idea of
government career service which also had acquired a sudden but not wholly artificial popularity as a
result of the closing of doors in the business world subsequent to the depression of 1929."
In the words of the Commission, ―we.......recommend that the day to day administrative work of
government be definitely made a career service. By this we mean that steps shall be taken to make
public employment a worthwhile life-work, with entrance to service open and attractive to young men
and women of capacity and character, and with opportunity of advancement through service and
growth to posts distinction and honour."
The Commission defined a career as "an honourable occupation which one normally takes up in youth
with the expectation of advancement and pursues until retirement. It also identified its main
characteristics as:
(1) High prestige/respect and status attached to government service,

(2) Appropriate recruitment procedures,
(3) Broad avenues for promotion and transfer of personnel,
(4) Clear pay scales, and
(5) Adequate retirement and pension system
In addition/similar to the above outlined ones, the main characteristics of a career civil service that
have got common acceptance are:
(1) Permanence of tenure and stability of service,

(2) Equal opportunity of competing for government services,
(3) Merit to be the sole criteria of recruitment with due recognition to ability and personal
efficiency in a sound promotion system,
(4) Fairly large extent of territorial jurisdiction of public employees to enlarge their scope of
activity and improve their avenues for promotions, and
(5) Adequate steps taken to provide in-service training to civil servants to keep them in
touch with the latest trends and developments in administrative theory and practice.
Powell also suggested the incorporation of (a) planned and continuing upward progression system, and
(b) planning of staff needs to be included in the provisions of a career civil service. The system of
career civil service is applicable to all ranks of administration from the highest to the lowest grades
and to all levels of government.
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Willoughby defined career system as "a system that offers equal opportunities to all citizens to enter
government service, equal pay to all employees doing work requiring the same degree of intelligence
and capacity, equal opportunities for advancement, equally favorable work conditions and equal
participation in retirement allowances and makes equal work demands upon the employees.‖
According to Prof. Milton M. Mendell, it is a system "predicated on recruiting young men and women
with capacity for learning and growth, training them in order to develop and utilize their aptitudes, and
offering them opportunities for advancement in responsibility and remuneration"
Ideally, a career civil service is a system of service, with recruitment on merit, security of tenure, and
due recognition of service and merit through timely promotions. Every organization has its own
service systems comprising permanent civil service groups, whose size and function depend on the
nature of the organization. Modern civil service constitutes people with both general and technical
qualifications.
The purpose of career service is to attract young men and women of talent and ambition in the
government service. Such opportunities of promotion and advancement should be provided so that
people may select government job as a permanent career.
However, there is a danger of mobility from government to private employment. White writes, "to
what extent the interchange of personnel between government and business may well arise from
interchange of this sort, and a few years training of a future, industrialist in a government office."
L.D.White pointed out a well- known risk in this way, "there is no defense for a cynical practice by
which able young men spend of a few years in the public service becoming familiar with the laws
and regulations with the more or less open expectations of capitalizing their knowledge by deserting
the public service to enter private employment where they turn their training against the
government."
Referring to the problem of adoptability, Stahl writes,‖ modern public personnel administration must
concern itself with the patterns through which careers operate. Should they be monolithic, providing
lifetime service in one organization in one place, should they involve all units in a particular state,
municipality, or other government entity? Should the public service be viewed as wholly distinct place
for careers in contrast to private employment, education or the professions? Can carriers best operate
within the slope of position classification scheme or will they flower only under plans like those used
in our military services? Obviously, there are no single rights answers to these questions applicable to
all situations. Condition imposed by the breadth and limitations of given occupations, size of
organization, personal interests, methods of compensation, status and prestige, tenure, and various
others factors all combine to influence what career system patterns should be like and what they can be
like in given instances."
B) Significance of career systems
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Today most of the work done by public servants is professional or technical. Experience that gained
over a considerable time, some times many years, is a factor that counts, it requires career officials. In
the more developed systems of personnel (labour) administration, most of the staff of the department
will usually have committed themselves to make their careers in it. The career booklets which so many
governments distribute to the universities and secondary schools should therefore include prospectuses
of the careers in the department of personnel (labor) and related services. It should be borne in mind
that anti-discrimination laws in many countries require the general run of labor administrative posts to
be open to women as well as men.
In order to attract good quality personnel, and to retain well qualified or especially promising officials,
the career prospects have to be attractive. For each of the substantive program units of the department
it is usually possible to map out the sort of progress that would be made by a reasonably competent
official. Programs to ensure this type of career development are a necessity, but that is not enough to
retain the most promising individuals. The career development arrangements generally include
opportunities for people in the upper ranges of certain specialist services to move into the higher ranks
of the administration.
There is also an advantage in allowing people to gain some variety of experience in the middle and
lower ranges of the service. This calls for some interchange of staff among the substantive programme
units, not only so that officials may discover the kind of work to which they are best suited but so as to
develop the versatility which is characteristics of senior officials in many developing countries. There
must also be a fair share out of postings between headquarters and the field and among stations in the
field, so that officials do not become bored or feel victimized. Furthermore there are spheres of
activity, such as vocational training; industrial relations work, work organization and productivity
studies, in which some interchange between government and industry, can be beneficial.
Chapter Two
Administrative Thoughts (Organizational Theories)
Organization theory has developed rapidly since 1920s, which have much relevance to public
administration. The primary purpose of organization theory as an academic study is to
understand and explain:
(a) Organizational problems as they relate to the structure of public departments, their
interrelationships, coordination, and internal functioning.
(b) How people in organizations behave and how organizations function.
The relevance is particularly apparent to those public sector organizations that are concerned
with the provision of goods and services. However, two important points should be noted in
considering these theories:
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(1) Organization theory doesn't exist as a coherent and universally accepted set of concepts.
(2) Organization theory is not traditionally concerned with public administration. It is thus
necessary when applying such theory for public administration to bear in mind that
whilst organizational features may be similar, public administration operates in a much
different institutional setting.
Three broad schools of thoughts to organization or administrative theory may be discerned
namely, "classical" or equally known as "scientific administration", "human relations" or
"behavioral", and "systems" theories. Each of these broad thoughts, which will be discussed as
follows also consist different sub-theories.
2.2.1. The classical Theory

The classical theory of organization is also known as the structural theory or the scientific
administration theory and its foremost proponents were Frederick W. Taylor, Henry Fayol,
Luther Gulick, James Mooney, to mention a few. The most important concern of the classical
theory is the formation of certain universal principles of organization. It deals with formal
organizational structure, the study of activities that have to be undertaken to achieve objectives,
and the grouping of such activities to achieve efficient specialization and coordination.
In some books, we may find scientific management (administration) theory as an independent

school of thought or theory treated separately from the classical theory. However, in the most
acceptable presentation, scientific management theory could be fairly seen under the general
category of the classical approach or school. The study of scientific administration began with
the advent of scientific management founded by Frederick W. Taylor, who lived from 1856-1915
and has been called the ―father of scientific management‖.
The following are brief statements of the main features of the classical school or approach to
organization.
Determining objectives: the basic purpose of determining organizational objectives is seen as
being to:
 Establish management priorities
 Indicate key departments and activities
 Provide consistency of human and materials organization with the objectives
Specialization and groupings: the classical theory treats specialization as the basis of
efficiency, and consequently places emphasis on the most effective management groupings of
specialist functions.
Grouping: the approach identifies four relevant factors in grouping:
 Span of control: the classicists consider that one manager is only capable of controlling a
limited number of subordinates.
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 Economies of scale: grouping should be made to produce or achieve economies of scale

both from the technical and resources aspects, and from the management aspects.
 Coordination: grouping may be justified and should be operated to achieve coordination
or integration of individual effort
 Unity: key activities that have long-term nature may be grouped under higher management
for direct supervision, to place highly interdependent units under a unified head.
Delegation: the approach believes that delegation defined as "the institutionalized right to make
decisions or give orders on behalf of an organization" should be to the point closest to that of
operation or job to be done and identifies factors relevant to delegation:
 It makes possible the achievement of economies of scale and specialization
 It diffuses the authority to make decisions to lower levels of the organization thus
enhancing initiatives and job satisfaction as well as identification with the goals of the
organization
Divisionalisation and decentralization: divisionalisation refers to dividing the organization into
units based on such factors as product type, geographical operation, etc while decentralization is
the systematic delegation of authority to all organizational units.
Specifying responsibility: responsibility is a corollary of authority, the natural consequence of
exercising power. The classical approach thus emphasized the need for clear specification of
responsibility for the following reasons:
 To avoid vague assignments that would result in confusion and jurisdictional conflict
 To make accountable those who are assigned with certain jobs and given responsibility
 To limit interference by supervisors
Line and staff relations: the classical theory emphasized the need for the establishment of line
and staff relationships, as well as relationships between superiors and subordinates for the
following reasons:
 It establishes official lines of communication throughout the organization
 It establishes to who each subordinate is accountable
 It establishes responsibility for coordination of the functions of subordinates.
Line functions are conceived of as vertical relationships and staff services as horizontal
supporting activities, the former being direct contributors and the later indirect contributors to the
fulfillment of the overall organizational objectives. .
All these being the major assumptions of the school towards organization, it tries to apply the
scientific method to obtain desired results in the workplace. Briefly, the scientific method uses
the following steps to achieve an objective:
1. Identify the proposition (objective)
2. Acquire information about the proposition through observation
3. Formulate a hypothesis about the proposition
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4. Investigate the proposition thoroughly by controlled experiments

5. Set priorities and clarify the data obtained
6. State tentative answer to the proposition
7. Adjust and implement the answer to the proposition
The school, most notably Frederick W. Taylor, also believed that management, not labor, was
the causes of and potential solution to problems in industry. Taylor called for a mental revolution
to combine the interest of labor and management into a mutually rewarding whole. He
emphasized the importance of mutual understanding and building better management and labor
relations.
Henry Fayol is a French contemporary of Taylor who came up with a concept or theory under
the general category of the classical school or approach known as "Administrative Management
theory". He made valuable contributions to administrative thoughts and development. Fayol
focused on the enterprise as a whole, not as a single segment of it, and he emphasized
rationalism and logical consistency.
Fayol's Administrative Management theory was often considered as the first complete theory of
management, the focus of which was on the job of the chief executive and on the principle of
unity of command. He divided all activities in an organization under six groups; technical,
commercial, financial, security, accounting and administrative.
He further propounded (advocated) the following fourteen principles of organization; namely,

(1) Division of work, (2) Authority, (3) Discipline, (4) Unity of command, (5) Unity of direction,
(6) Subordination of individual interest to general interest, (7) Remuneration of personnel, (8)
Centralization, (9) Scalar chain, (10) order, (11) Equity, (12) Stability of tenure of personnel,
(13) Initiative, and (14) Esprit de corps. The last one, Esprit de corps, is a French term that
denotes feelings of pride, care and support for each other etc, that are shared by members of a
group.
Mooney and Reiley, in their famous work known as "the principles of organization", have also
argued that all organization structures are based on a system of superior-subordinate
relationships arranged in a hierarchical order termed as "scalar principle". According to this
principle, in every organization there is a grading of duties in varying degrees of authority and
corresponding responsibility. The "scalar principle" has its own principle, process and effect
termed as leadership, delegation and functional definition.
Luther Gulick who has been considered as another notable thinker of the classical school,
defined major managerial techniques by an acronym known as "BOSDCORB", each letter
standing for planning, organizing, staffing, directing, coordinating, reporting, and budgeting.
In general, the classical or scientific management school has contributed tremendous
administrative knowledge to us. Its essence is the development of an inquiring mind, searching
for more knowledge, more facts, and more relationships. Historically, it is associated with
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economic considerations such as cost, time use, and efficiency supported by research methods of
other disciplines.
Advocates of this school firmly believe that better management is possible by using scientific
method, and best management is never permanently attained because continuous new knowledge
paves the way for constant improvement. Moreover, the school tried to replace rule-of-thumb
methods by scientific methods. It sought to analyze existing practices; study works for
standardization and improvement. On the human side, the school suggested the highest degree of
individual development and reward through fatigue reduction, scientific selection to match
individual‘s abilities to their jobs, and wage incentives.
In general, the major theme of scientific management was that work could be studied
scientifically, work processes are separable into units, the efficiency of each work unit could be
tested and improved through careful scientific analysis, and the techniques could be applied
universally.
There are, however, certain criticisms made by different commentators as the classical theory has
its own defects. These include:
 Underlying assumptions: the basic classical assumptions have been challenged in that
they oversimplify, and fail to take account of the development of small informal groups
and sub-groups, which may be at odds with the overall organizational goals.
 Problem definition: the classical approach presumes both the importance and the ease
of defining objectives and fails to recognize that in public administration the definition
of such objectives is interwoven with broad political process. In other words, there are
problems in defining and quantifying objectives in public administration particularly
where social criteria are involved.
 Means not ends: the approach concentrates on the means whereby objectives may be
achieved, but gives little or no guide to the relevant elements of establishing ends.
Consequently, the approach is unrelated to the social and political problems faced by
2.2.2. The Human Relations (Behavioral) Theory

This theory involves the study of motives and behavior and the development of criteria to help
design an organization that stimulates members to cooperate in achieving organizational aims.
The behavioral approach generally belongs to the neo-classical school of thought, focusing on
the behavioral, humanistic or human relation aspects of administration for which Elton Mayo is
known as the major contributor of the thought.
It is primarily concerned with the analysis of the behavior of groups and individuals within the
organizational context. Much of their work is experimentally based and concludes that social
classification must be taken into account when explaining behavior.
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According to behavioral thinking, it is important that organizations should devise objectives

taking into account the needs of their staff as well as those of the organization as a whole. For
example, positive measures to stimulate cooperation and to avoid conflict should be made. In
practice, the neo-classical (behavioral) approach is concerned with the following:
(a) Needs and wants: the approach involves the study of an individual's wants and
needs,stimulating factors that help to satisfy needs and achieve organizational goals.
Needs have to be classified as physical, safety, social, egoistic, and self-actualization.
Thus, an organization should offer incentives to satisfy such needs as well as
effectively subjugate (suppress) personal values of individuals to those of the
organization.
Incentives may be defined as "the appeals an organization makes to the personal
values of employees to induce them to accept organizational values". Incentives can
generally be classified as:
(i) Material inducement,
(ii) Opportunities for distinction, honor and recognition,
(iii) Good physical working conditions,
(iv) Personal confidence and satisfaction in social relationships within the
organization,
(v) Conformity with habitual practices, and
(vi) Feeling of participation and belongingness,
(b) Work groups: the approach recognizes the influence of a group on the individual's
attitude and behavior. It points out that an individual doesn't operate in isolation, and
in particular:
 He/she tends to conform to group pressure.
 His/her attitudes and morale are influenced by group associations.
 Problem solving and leadership are often group functions.
(c) Supervisory behavior: this is treated as a vital factor in influencing work group
behavior, as the supervisor represents the link between the group and the formal
organization.
Writers like Barber (1983:37-41), underscore the importance of behavioral studies in
organization and expose the failures of public administration to consider behavior as an
influential factor. According to this author, public administration studies tend to concentrate on
the machinery of administration, to the exclusion of those factors influencing behavior in
organizations and consequently that of organizational effectiveness. However, any public
administration system depends for its effectiveness on both organizational factors and behavior
within the structure of that organization.
Generally, the approach is concerned with inter-group behavior and study of relations between
groups rather than between individuals and emphasizes the power of groups in decision-making.
However, group participation in this regard is criticized for the following reasons:
(a) It increases group domination of its members
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(b) Responsibilities become blurred

(c) Group and expert judgments may conflict
(d) The cost of reorienting supervisory functions may exceed the benefits of group
participation
(e) The process is not automatically effective and depends greatly on supervisory and
management attitudes
The behavioral (neo-classical) criticism of the classical school shows that scientific
administration is ignores the impact of staff satisfaction and psychology on the performance of
the organization as a whole. The classical concentration on specialization, span of control, etc, is
rejected as being inconsistent with needs and wants.
In conclusion, the classical (scientific administration) and neo-classical (human relations or
behavioral) approaches vary in the following important aspects:
(a) Whereas the human relations school is concerned with the organization evolving
effectively from inter-personal behavior, the classical school predetermines the
organization within which individuals are required to function
(b) The human relations approach results in a comparatively flat organizational structure,
whereas the classical approach results in a pyramidal structure
(c) Authority is regarded by the human relations approach as a social factor, but as
organizational factor by the classical approach
(d) Interdependence is a key factor in the human relations approach, which considers that the
classical definition of responsibility creates competition.
2.2.3. The Systems Theory

In some literatures, we may find systems theory as being one of the theories that are within the
category of the "Modernization School of Thought" along the Contingency Theory and
Management Process Theory, while in some others systems theory is recognized as an
independent school of thought. This approach concentrates on decisions that need to be made to
achieve objectives, and the organization is thus designed to facilitate decision-making.
The systems approach treats organization as an example of a "system", i.e. a set of
interdependent parts forming a whole with the objective of fulfilling some definable function. An
organization is essentially regarded as a decision-making system and treated as being built up
from the analysis of information requirements and communications networks. It, thus, treats the
process of decision-making as basic to the determination of objectives and policies. The
methodology of the systems approach consists of the following steps:
(a) Specifying objectives
(b) Establishing subsystems (main decision areas)
(c) Analyzing these decision areas and their information needs
(d) Designing the communication channels to facilitate information flow within the
organization
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(e) Grouping decision areas to minimize communication problems. In practice, the

approach illustrates the importance of organization of information, the advantages of
projects rather than functional divisions and the need to concentrate centrally the
information network
Within the systems theory, the contemporary approach to the theory of organization is to
abandon the idea of treating organizations as the mere passive instruments operating in response
to external pressures. Rather, organizations are regarded as semiautonomous systems, which
develop their own internal goals; having their own performance and conservation (survival)
objectives.
All schools of thoughts on organization have developed mainly to explain aspects of
performance and behavior that can be observed. From the point of view of the practicing
administrators, each school is likely to offer useful perspectives and be helpful in revealing past
weaknesses and enabling the establishment of better structure.
2.2.4. The Bureaucracy Theory

The term "bureaucracy" is a combination of two words; i.e. "bureau" and "cracy". "Bureau"
means an office or organization established to perform certain activities, or it may mean a
government department, while "cracy" denotes a form of governmental rule. In this
consideration, bureaucracy simply means a form of rule or activity exercised/practiced by
governmental offices.
In its literal meaning, "bureaucracy is a system of official rules and ways of doing things that a
government or an organization has, which are complex in nature; or a system of government in
which there are a large number of state officials who are not elected".
Bureaucracy was first used in France as "bureaucratic" in the eighteenth century to refer to "the
government in operation". Classical writings on bureaucracy can be traced to several sources,
notable contributors of which were Karl Marx, Max Weber, and Robert Michels.
Prior to the tremendous contribution of Max Weber, Karl Marx attempted to explain bureaucracy
in a scientific manner. He tried to conceptualize the role of bureaucracy in his works on state
organizations, while developing a critique of the political economy of capitalism that existed in
Europe in the 19th century.
Different from Weber's understanding of bureaucracy as an ideal type that can exist only in
abstraction, Marx examined it as a set of relationships that arise in a specific socioeconomic
context. Marx said, "Bureaucracy considers itself the ultimate finite purpose of the state".
Marx also mentioned about the spirit (typical feature) of bureaucracy. According to him, the
universal spirit of bureaucracy is the secretiveness, the mystery (strangeness) sustained within it
by hierarchy and maintained as a closed corporation. He further believed that authority is the
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principle (source) of knowledge, and the desiccation (preservation) of authority is its sentiment
by maintaining obedience to fixed normal activity, fixed principles and loyalty.
For individual bureaucrats, the state's purpose becomes their private purpose of hunting for
higher position and making a career for themselves. According to Marx, the bureaucrat cannot be
a rational actor in terms of competence. Its hierarchy of structure means a hierarchy of
knowledge, thus comprehensive knowledge is impossible in a situation where knowledge is
deliberately split up into practical reality and bureaucratic reality. Generally, Marx as quoted in
Rumki Basu (1994:79), described bureaucracy as follows:
The bureaucracy is a circle from which no one can escape. Its hierarchy is a
hierarchy of knowledge. The top entrusts the understanding of detail to the lower
levels, whilst lower levels credit the top with understanding of the general and so all
are mutually deceived".
From his explanations, we can understand that he has overemphasized the malicious (evil) side
of bureaucracy, and his view is in clear contrast to the conception of his countryman, to the
Weberian conception of bureaucracy as "rationalization of organization". Nevertheless, whatever
arguments he has made and explanations he provided about bureaucracy, public administration
as a discipline didn't care much for his views since it was not his purpose to develop a theory of
public administration. He simply wrote a critique on bureaucracy alongside his famous critique
of the political economy of capitalism.
Robert Michels, who is equally known in the theory of bureaucracy, on the other hand
concentrated his analysis on the internal politics of large organizations and to the phenomenon of
elite domination in organizations. His observation was based on the internal structure of the
German Socialist Party, which was supposed to be organized along democratic principles yet the
reality was quite different, and he discovered that the system was oligarchic. He concluded that
all big organizations tended (had a propensity) to develop a bureaucratic structure that ruled out
the possibility of internal democracy.
The various meanings, which have been given to the term, include the following:
(a) Institutional meaning: the term "bureaucracy" may refer to government by appointed or
recruited officials as opposed to government by elected representatives. Alternatively, it
may be used to indicate that, although representative government exists, the dominant
role is held by officials. These definitions, however, tend to be inadequate in that they
fail to distinguish those common situations where government consists of a combination
of elected and non-elected members and officials.
(b) Activity of officials: in contrast, a definition may be attempted from the aspect of what
officials do or how they behave. In this regard the following interpretations exist;
(i) Derogatory: the synonymous use of "bureaucracy" and "red tape", resulting from
the real and supposed difficulties of dealing with the official environment. This
is however an extremely offensive yet subjective meaning of bureaucracy.
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(ii) Regulated system: a regulated administrative system operating through complex

interrelated organs,
(iii) Methodological: a study of methods based on either the first (i) or the second
(ii) points above,
The definition based on the activity of officials, as a regulated system (item b-ii above), is used
in most instances due to its objective and analytical nature. The other definitions are associated
with subjective or disparaging connotations. Bureaucracy is thus conceived as a form of
organization. Etzioni, as quoted in Michael P. Barber (1983:87), considered that organizations
are characterized by the following:
 Division of labor, power, and communication responsibility deliberately planned to
achieve certain goals,
 The presence of power centers, which control the concentrated effort of the
organization and continuously review its performance and re-pattern its structure to
increase efficiency,
 The classification of personnel,
Etzioni's view is based on Weber's classical view of bureaucracy, which will be discussed
subsequently.
2.5.5. The Weberian Model of Bureaucracy

Bureaucracy as an organizational model was first developed systematically by Max Weber, a
distinguished German sociologist in the 19Th century. According to him, every organization can
be defined as "a structure of activities (means) directed towards the achievement of certain
objectives (ends)". Every organization develops a system of specialization (division of tasks) and
a set of systematic rules and procedures to maximize efficiency.
Weber stressed that the bureaucratic form of organization is capable of attaining the highest
degree of efficiency since the means used to achieve goals are rationally and objectively chosen
towards the desired ends. In this sense, it is the most rational means of carrying out functions
effectively in any organization, superior to every other form in precision, stability, discipline,
and reliability. Weber tried to identify the various factors and conditions that have contributed to
the growth of bureaucracy in modern times. Namely:
(a) The development of modern large-scale organizations and corporations has led to the
development and considerable spread of bureaucracy. Whatever may be the evils of
bureaucracy, it is indispensable for the running of complex administrative structures.
(b) The role of expanding technical knowledge and the development of modern
technology is another important factor responsible for the superiority of bureaucratic
organizations. A considerable degree of bureaucratic specialization is required to attain
high level of efficiency regardless of the economic system to be either capitalistic or
socialistic.
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(c) The capitalist system itself has been also considered as the main contributive factor.
Weber repeatedly stressed the fact that the capitalist system has undeniably played a
vital role in the development of modern bureaucracy. The proper functioning of the
capitalist system necessitates a stable state and a well-organized administration, which
is the bureaucracy.
Max Weber principally developed the organizational definition of bureaucracy and conceived of
the concept in two aspects, namely:
(a) The social mechanism that maximizes efficiency in administration
(b) A form of social organization with specific characteristics. Social organization is
described as "institutionalized strategies for the achievement of administrative
objectives by the concrete efforts of many officials".
Weber specified the following structural and behavioral characteristics or conditions that an
organization must possess before properly being called or distinguished as a bureaucracy:
(1) Division of labor: This involves a specified sphere of competence, which has been
marked off as part of a systematic division of labor in the organization, and job
placement is based qualifications and/or special training. The regular activities
required for the purpose of the structure are distributed in fixed ways as official
duties,
(2) Hierarchy: It is the feature of any bureaucratic form of organization. The
organization of offices follows the principles of hierarchy, with a clear separation
between superior and subordinate offices; i.e. each lower office is under the control
and supervision of a higher one. Being a bureaucratic official constitutes a career, and
there is a system of promotion and career advancement on the basis of seniority or
merit, or both,
(3) Rules: Bureaucracy operates in accordance with a consistent system of abstract rules
laid down regarding the performance of official jobs. There is consistency in the
application of the rules to specific cases to avoid personal favoritism, arbitrariness, or
nepotism that would otherwise hinder the function of an organization,
(4) Rationality: Weber's ideas on efficiency and rationality are closely related to his ideal
(typical) model of bureaucracy. For Weber, bureaucracy is the most rational known
means of achieving imperative control over human beings. For example, candidates
are selected on the basis of technical qualifications, which will be tested, in the most
rational cases, by examinations, or guaranteed by diplomas certifying technical
competence, etc.
Personal whims of the leaders are no longer effective in such a system; there is a clear
demarcation between personal and official affairs. Rationality is also reflected by the
relatively easier means of calculability of results in the organization,
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(5) Impersonality: the bureaucratic form has no place for personal whims, fancies, or
irrational sentiments. Officials are subject to authority only with respect to their
impersonal official obligations,
(6) Rule orientation: rationality and impersonality are mainly achieved through the
formulation of rules and procedures that clearly define official spheres of authority
and conduct, which the employees are supposed to maintain in discharging their
duties. This is to mean that the official is subject to strict and systematic discipline
and control in the conduct of his/her office,
(7) Neutrality: Bureaucracy is supposed to be apolitical and neutral in its orientation. It is
also value-neutral committed only to the work it is meant to perform.
While the first three points are structural characteristics of bureaucracy, the rest four points are
behavioral characteristics. Further elaborations of those points mentioned above as structural and
behavioral characteristics of bureaucracy would help to understand their basic essences in the
views of Weber.
Weber concluded that a fully developed bureaucracy has those advantages of speed, precision,
non-ambiguity, continuity, discretion, unity, strict subordination, and reduction of friction and of
material and personal costs. He considered that its specific nature develops more perfectly the
more it is dehumanized, i.e. "the more completely it succeeds in eliminating from official
business all purely personal, irrational, and emotional elements that escape calculation". The
organization conceived by Weber is therefore designed to achieve rational orientation towards
tasks, which are conducive to effective administration.
Max Weber has also talked about bureaucratic procedures as having the nature of dictating the
course of action governed by a prescribed set of rules, in order to achieve uniformity. Such rules
are abstract in order to guide the different courses of action necessary for the accomplishment of
organizational objectives in diverse conditions. The rules become more detailed at the lower
points in the organization's hierarchy.
Weber stated that bureaucratic officials would approach the public "in a sprit of formalistic
impersonality without hatred or passion, and hence without affection or enthusiasm". He
considered this requirement as intended to assure equitable treatment of clients, and rational
rather than emotionally dominated administration.
In spite of the seemingly, or apparently for that matter, logical presentations of Weber about the
advantages of bureaucracy, there are critics along several lines or cases against it that stem from
its supposed mechanistic nature, i.e. its regimentation (strict discipline and formalism) and
predictability. The following are among the critics that turned against the advantages of
bureaucracy:
(a) People in bureaucracy fulfill merely segmental roles over which they have no control
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(b) In consequence, they have little or no opportunity to exercise individual judgment, with
the result that employees feel separated from their work
(c) In order to be effective, bureaucratic personnel must behave consistently and follow
regulations strictly. This automatically limits a bureaucrat's capacity to adapt to
changing circumstances not envisaged by those who drew up the rules
(d) The general rules, which may make for overall efficiency could produce inefficiency
and injustice in individual cases
(e) The impersonal treatment of clients envisaged by Weber is not always operable in
practice as many researches disprove such principles of impartiality.
(f) Weber's view that bureaucrats should not become closely involved in personal relations
with colleagues has undesirable practical effects
(g) The key limit on the efficiency of bureaucratic administration lies on the difficulty of
coping with uncertainty and change, thus bureaucracy rests upon tasks being
convertible into routine.
Chester Barnand has also criticized Weber for not recognizing the role of informal organizations
and better human relations in increasing efficiency. Weber is also criticized for not paying
adequate attention in his theory to human behavior, relations, morale and motivational factors.
His theory has been called a "machine-theory" and a closed system model overemphasizing the
formal rational aspects of bureaucracy while ignoring the whole range of socio-cultural
environment and behavioral characteristics of large formal organizations.
Weber has failed also to analyze and compare the correspondence of behavior in organizations
with organizational blueprints. In particular he failed to account for the fact that in the course of
operations new elements arise in the structure that would effectively influence subsequent
operations.
More other critics indicate that since bureaucracy is characterized by passion for routine in
administration, the sacrifice of flexibility to rule or overemphasis on rules and regulations rather
than on goals and objectives, delay in making decisions, lack of public relations and class
consciousness on the part of bureaucrats, and refusal to embark upon experiments, it cannot be
considered as the best means of achieving efficiency or as having no limitations.
The Weberian model of bureaucracy is a product of an alien or unfamiliar culture, which is fairly
inadequate for imposition in the developing societies where rapid change is required to bring
about socioeconomic transformation. Hence, the Weberian model of bureaucracy can best
function in a stable environment with routine and repetitive tasks since its capacity in adaptation
to change is limited.
The concept of bureaucracy has been also criticized by writers of the modern time like Riggs as
being "the product of a specific historical and political milieu (setting)". To overcome these
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shortcomings of the bureaucratic model, Riggs developed his ecological model of public
administration relevant to developing societies.
There are however many commentators who do not fully agree with such critics. Rather, the
critics and the realities with regard to the relationship between bureaucracy and public
administration, in particular that of the civil service made to draw the attention of scholars and
practitioners. As many commentators in the field would agree, bureaucracy is condemned both
for what it is and it is not. Bureaucracy, like any other system, has weaknesses and strengths as
well as advantages and disadvantages.
First of all, it is important not to confuse defects in bureaucracy with defects in public
administration (public administration considered as "large-scale organization"). Defects in
coordination and organization inherent in large-scale organization may apply whether the
organization is bureaucratic or not. In addition, criticism of complexity of organization, the
subordination of individual, and the stifling (suppression) of initiatives must be accepted as
applicable to most large-scale organizations and not merely as characteristic of bureaucracy.
Different arguments have been made also with regard to the application of the theory of
bureaucracy to the civil service. As Barber (1983:90-91) pointed out, "the civil service has been
accused of containing a bureaucratic, hierarchically organized, tightly knit elite. On the other
hand, it has been stated that bureaucracy is a means of institutionalizing clear, universal and
impartial procedures for administration, infinitely preferable to most of its historical
alternatives". In practice, civil service systems of many countries accord with many of Weber's
characteristics and principles of bureaucracy mentioned above.
In conclusion, the bureaucracy theory of organization has made useful contributions to the study
of public administration in general in terms of developing the concept professionalism in
administration by incorporating rationalist ethics and standards of conduct and business. Ideally,
it is a major breakthrough from the earlier corrupt, closed, authoritarian, and unresponsive
administrative systems. It is therefore a progressive and useful model of organization.
It is also necessary to bear in mind that Weber wanted to construct an "ideal type" model of
bureaucracy, which obviously cannot be approximated to reality. Weber was rather sufficiently
aware of the evils of "bureaucratization". He merely compared the prevailing administrative
systems of his time and the earlier ones with the ideal model of bureaucracy he constructed. It is
a reality that bureaucracy is still the best one in the history of administrative system and has no
substitute until this time.
Chapter Three
Development Administration: Concept and Approaches
187
Introduction
The essence of development administration is bring about change through integrated,

organized and properly directed governmental action in the recent past the government in most
of the developing nations have shifted their focus on development by means of planned change
and people‘s participation. With this shift of administrative concern toward developmental
objectives the researchers and practitioners of public Administration have been forced to
conceptualist the developmental situation and bring the gaps in administrative theory. The
growing welfare functions of the government have brought into limelight the limitations of the
traditional theory of administration.
The essence of administration in the present conditions lies in its capacity to bring about change
in the structure and behavior of different administrative institutions , to develop an acceptance
for the change and to create a system which can sustain change and improve the capacity of
intuitions to change All this calls for renewed efforts on the part of institutions engaged in the
tasks of development Thus development goals assumes importance This unit will highlight the
meaning features and genesis of development administration.
3.1 MEANING OF DEVELOPMENT ADMINSTRATION

There is no uniform definition of development administration which is agreeable to all. But we
can at least arrive at certain basic features and characteristic of development administration that
have uniform acceptability and applicability. In order to understand the concept of development
administration, we should try to understand the meaning of the concept viz, administration of
development and development of administration
i) Administration of Development
Development is integral to the aims and activities of the government especially in the developing
countries. Because of optimum utilization of available means and augmenting new means
assume a great importance. Development administration thus becomes a means through which
the government brings quantitative and qualitative changes in an economy. Government is
engaged is not only fixing priorities but also making efforts to realize them. Though Widener is
said to be the first to conceptually explain the definition of development administration,
many other scholars, like Riggs, Ferrel Heady, Montgomary, Gant PaiPanandikar have
attempted to define the term in the their own ways .
Development is not only viewed in terms of growth process, but it includes a process of social
change.
The state plays a leading role in bringing about development through its administrative system.
In order to discharge this role, it requires a distinct type of support by administration which
involves, as has been observed by Swedlow , special understanding of problems in the
developing countries. These must be perceptible at different operative levels i.e.; officials must
188
make enough different decisions, adopt enough different policies and engage in enough different
activities to warrant the different designation of development administration. Thus development
administration is simply termed as an action or functioning part of the government
administration. It is action – oriented and places the administration at the centre in order to
facilitate the attainment of development objectives.
For Harry J. Friedman, development administration means:
i) The implementation of programmes designed to bring about modernity (ie. Socio

economic progress and nation – building ) , and
ii) the change within the administration system which increase its capacity to
implement the programmes. According to Hahn Beanie, development
administration is involved in managing a government or an agency sa that it
acquires an increasing with a view to achieve sustained growth. Gant observed
that development administration is ―that aspect of public Administration in which
focus of attention is on organsing and administering public agencies in such a way
as to stimulation and facilitate defined programmes of social and economic progress
It has the purpose of making change attractive and possible.‘‘ Thus development
administration involves two elements :
Development administration concentrates on the needs and desires of the people. It is concerned
with formulation of plan, programmes, policies and projects and their implementation. It plays a
central role in monitoring and evaluation of plans and programmes It is not only
concerned with the application of policies as determined by the political representatives in
existing situation but also with introducing efforts to modify existing situations so as to
serve the cause of the masses.
The administration of development implies:
i) the execution of programmes designed to bring abut progressive improvement in

social, economic and cultural areas; and
ii) the changes within an administrative system which increases its capacity to
implement such programmes In brief, administration of development involves
implement such programmes. In brief, administration of development involve the
following objectives
i) application of innovative strategies for development
ii) Emphasis on development at the grassroots level. Development has to be a need –
oriented and self - reliant process
iii) stress on social development and human capital as a major resource
iv) development has to be viewed not merely as a technological problem but also as an
administration
v) profound and rapid change in order to establish a distinct and just social order
189
vi) recognizing and highlighting the unity, rather than dichotomy between politics and
administration
vii) effective and efficient use of scarce resources
viii) creation of a politics administration which is oriented towards securing basic needs
of the population
ix) freedom of administrative machinery to express is values and beliefs without fear or
flavor on programmes and projects
ii) Development of Administration or Administrative Development
Development Administration has to be efficient and effective. For that purpose has to aim at
enlargement of administration In simple terms it means development of administrative
system of administrative health by introducing administrative rationalization and institution
building The purpose implicit in this concept is not merely changing the administrative
procedures and channels but also bringing out fundamental change in administration that leads
to :
1. Political development
2. Economic growth, and
3. social change
The administration should evolve so as to commensurate with societal goals.
Development of administration further means cultural change in administration. The colonial

administrative culture is unsuitable to the changed socio – political ethos of the developing word.
Developmental administration should refer to the creation of ability to adjust to new stimuli or
changes. The development of administration aims at qualitative and management of affairs. The
term also implies technological changes in administration so as to enable it to adopt new modes
or techniques of administration Thus administration development focuses on adaptability,
autonomy and coherence in administration.
In short, administrative development is concerned with:
a. The capacity of an administrative system to take decisions in order to meet the

ever increasing demands coming form the environment and with the objective of
achieving larger political and socio – economic goals.
b. Increase size, in specialization and division of tasks and in the professionalisation
of its personnel.
c. A pattern of increasing effectiveness in the optimum utilization of available
means and further augmentation of the means if necessary.
d. Increase in administrative capability and capacity
e. Transformation of existing administrative mechanism into new machinery
through modernizing the bureaucracy by external inducement, transfer of
technology and training.
190
f. Replacement of initiative, practices etc. with those based on realistic needs.

g. Reducing the dependence on foreign experts by producing adequate trained
manpower.
h. Promotion of development initiative.
i. Administrative reorganization and rationalization.
j. Making modernization culturally related.
k. Removing or reducing bureaucratic immobility and widespread corruption
l. Reorientation of established agencies, and the delegation of administrative
m. Creation of administrator who can provide leadership in stimulating and
supporting programmes of social and economic improvement
Actually administration of development and development of administration are interrelated
concepts. Both are dependent dependent of administration. To achieve development goals it is
essential that there is proper assessment of resources plan and implementation, adequate
involvement of reemphasis on technological change and self reliance At the same time we also
no developed bureaucracy, integrity in administration, initiative, innovativeness, delegation of
powers, decentralized decision - making and reform. Both the concepts support each other and
development administration is needed for administration development. As per F. Riggs
‗development administration‘ and ‗administrative development have a chicken and egg kind of
superiority of one over the other.
Difference Between Traditional Administration And Development Administration
Traditional v) Centralized decision making(

past experience as the main guide
to problem solving )
i) Regulatory Administration vi) Emphasis on maintaining status
(routine operation quo ( resistance to organization
ii) Oriented towards efficiency and change)
economy ( emphasis on
individual performance)
Developmental
iii) Task orientation and conformity
to rules and procedures ( i) Unpredictable new tasks or
Concern for security, playing problems ( rapidly changing
safe, comfort, states and power) environment )
iv) Sharp and elaborate hierarchical ii) Oriented towards organizational
structure ( strict and growth and effectiveness in
authoritative climate of mistrust) achievement of goals ( emphasis
on group performance and inter
– group collaboration )
191
iii) Relationship oriented with

emphasis on high programme
standards ( willingness to take
risks, encouraging innovation
and change)
iv) Structure shaped by
requirements of goals (
flexibility and continuously
changing role , mutual trust and
confidence )
v) Wide sharing decision – making.
(Empirical approach to problem
solving and use of improved
aids to decision – making )
vi) Continuing organizational
development in response to
environmental demands
(development of an organization
which is dynamic, adaptive and
futuristic)
192
Traditional administration has been visualized as one concerned with fulfilling the legal
requirements of governmental operations and maintenance of social stability. In the main, this
type of administration confines itself to maintenance of law and order, collection of revenues
and regulation of national life in accordance with the statutory requirements. The assumption
behind the differentiation between developmental values is, thus, the qualitative goals of
development administration i.e. planning for the people , with people‘s support and co-
operation distinguishes it from that distinguishes development administration as a separate
identity is that ― it is not a closed system, the linkages with experts, relationships with the
grassroots level and with the are more important than central structures. Though there is
development administration, external relations have to be optimized before resources can be
focused on limited incremental goals. Development administration is concerned with attitudes
and processes rather than procedures and structures‖
Application of Development Administration
The functions or roles of development administration is to assure that an appropriately congenial

or friendly environment and effective administrative support are provided for delivery of capital,
materials, and services where needed in the productive process; be it in public, private, or mixed
economies.
Applying the principles of development administration requires changing the perceptions and
attitudes of planners and administrators about the nature of development and building their
capacity in solving social problems. The challenging role of developmental administration
demands three different functions:
(i). Institution building responsible for sustaining and promoting an industrial revolution, for
carrying on other public utility services, and for regulating and distributing essential
commodities,
(ii). Manpower planning and development, which deals with the cultivation of technical,
professional and managerial skills for running public institutions,
(iii). Human development, which would involve changing the very attitude and temperaments
of people to adjust with changing realities,
The management of development has been the central focus of development administration. It
connotes planned institutional capacity to accomplish the specific goals of development through
the formulation of appropriate policies, programs, and projects and their successful
implementation. Participative, responsive, and accountable management constitutes the essence
of development administration.
George Gant has once again aptly said, development administration is characterized by its
purposes, its loyalties, and its attitudes such that:
1
(i) The purposes are to stimulate and facilitate defined programs of social and
economic progress, change, and innovation as well as to apply policies and to
conduct programs of development specified by the people,
(ii) In terms of loyalties, development administration has to be goal-oriented, client-
centered, accountable and responsive to public wishes and demands.
(iii) In terms of attitudes, development administration has to be persuasive rather than
restrictive, outward reaching rather than inward looking, flexible and adaptable
rather than adherence to traditional norms and forms, and result oriented rather
than process oriented.
Riggs also views development administration as a goal-oriented administration- an
administration, which is engaged in the task of achieving progressive political, economic and
social goals. In this context, he developed the concept of "administrative development" that
refers to the increase in the capabilities of an administrative system to achieve the prescribed
goals.
Inherent in development administration is the idea of decentralization and people's involvement

in all aspects of development. Another area of academic interest is the close link of development
administration with political process. When trying to secure equity, there would be a conflict
between the haves and the have-nots. It means also creating opportunity for power distribution.
Development policy formulation is vitally connected to the political process of a society.
Therefore, to divorce development administration from politics would be shortsighted and
incomplete.
Briefly, the present and future priorities of development administration are as follows:
a) With the increasing functions of state, the role of administration will continue to expand
in the development sphere; the government becoming the principal planner, organizer,
promoter, and director of developmental efforts,
b) With increasing diversification of governmental functions, administrative activities will
gradually become complex and technical,
c) There will be greater need for planning, coordination and control of all governmental
activities connected with development,
d) The administrative reforms and improvements will have to be greatly emphasized,
e) Personnel structure and training will have to be geared to development tasks, rigid rules
and regulations will have no place, decision-making in organizations will have to
flexible,
f) There is a need to redesign public bodies to enable collective decision-making and
promote collaborative problem solving,
g) There will be an increasing decentralization to enable developmental agencies at field
level to operate more autonomously,
h) There should be free flow of communication at all levels of the organizational pyramid,
2
i) There should be adequate working partnership, between the political and executive wings
of administration,
j) Commitment and dedication on development agents, especially on the parts of political
leadership and bureaucracy, will be the first and most essential prerequisite for
development administration,
k) The active participation and cooperation of the people should be forthcoming for the
success of development programs,
3.2 GENESIS and Evolution OF DEVELOPMENT ADMINISTRATION

Genesis of Development Administration in the 1950s
Ushering development in the developing and under developed countries the concept of
development administration emerged besides the success in dealing with the affects of
depression and Second World War, the marshal plan for the reconstruct effects of Western
Europe and the process of decolonization provided the request.
Background amounting to the coining of the theory of development administration was an Indian
scholar Goswami who used the concept for the first time in 1955, Later on good number of
scholars all over the world have contributed to its enrichment.
Classical economists‟ view development has been the important basis of the development
theory in the 1950s with emphasis on increase in the GNP or per capital income. The
economics growth model based on the Keynesian economic approach (macroeconomic
approach) which paved the way to development thinking sought to transform the inscriptive
particularistic and functionally diffused underdeveloped sociology, which viewed the
underdeveloped society as a closed traditional society stagnating in primitive isolation, also
contributed towards the concept of developlopment administration
It was the instrumental Theory of Administration and Popular Government which occupied the
front rank in the development administration model in 1950 and early 1 960s. This theory
generated prescription or normative approach viewing administrative reforms as a precondition
to development. The government became a crucial instrument in designing and administering
goals for achieving developmental objectives. The government designs monetary and fiscal
policies it amounted to the concept of planned development having the assumption that the
developing countries could be helped to develop with the aid of western technology of
administration. The important ingredients of development administration model were:
(i ). Establishment of planning institutions and agencies;
(ii) Improvement of the central administrative systems;
(iii) Budgeting and financial control; and
3
iii) Personnel management and organization and methods

This model had stress on:
a) reforming the administrative structures;

b) (ii) Creation of new agencies improving the administrative technology
in terms of methods; and
c) (iii) Procedures and practices on the lines of western administrative
thought.
The theories propounded by waver, Gullick, Taylor and others were implanted into the
administrative practices in the developing countries in order to ensure the validity of such
techniques and methods in the developing nation‘ environment, the administrative techniques
and methods developed in the west were to be injected.
The administrative values prescribed in this period were efficiency, economy and rationality.
Besides, the principles of professionalism, hierarchy, unity of command, formalization and
impersonally, span of control, authority commensurate with responsibility, staff and line
decentralization and delegation of control, authority commensurate with responsibility, staff and
line, decentralization and delegation of authority became the basis of organizational structure .
3.3 Development Administration in the 1960S

Failure of Technical Assistance Programme in public administration
It could be said that the Technical Assistance Programme advanced the principle of emulative
development administration for building up of administrative capabilities a prescriptive manner
However, it has been criticized by many a scholars. Dwight waldo, for example, has termed it as
―naive‖ and ―a sad waste of scarce human resources‖ The reasons for the failure of technical
assistance can be summed up as follows
1) The application of the development model was taken for grated in all countries ignoring
the relevance of environmental context to administration and technology
2) The concepts like efficiency economy and rationality night be differently interpreted by
the developing or recipient country than the meaning give to then in the west,
3) It was planning without implementation Furthermore, since planning has social economic,
political and cultural dimensions also, many proposals for administrative reforms, for
example, could not be implemented for the lack of political support and support from even,
the bureaucracy.
4) Protagonists of Technical Assistance programmed did have adequate knowledge

and health, education, industry, labor; population control etc. Which was much needed
to be dealt with in more details?
4
5) The modern administration management techniques like CPM, PERT, Linear programming
network analysis long –range planning and forecasting cost benefit analysis etc. were not
included for the purposes of transfer to the developing countries.
6) Administrative reforms attempted during this period concentrated mainly on structural change
and not on attitudinal change.
The technical assistance approach to development administration has been criticized by Esman
when he offers the following views:
1) Neither economic growth nor institutional modernization is nonlinear. Economies

may stagnate institution may decline in effectiveness and societies may fail to deal
with their central needs The benefits of rapid economic growth, specially, derived
from mainline urban-industrial investment model have been skewed towards a
relatively small minority in the modern sector, leaving rapidly increasing majorities
especially in rural areas as impoverished, insecure, and powerless as they were
before.
2) Confidence in the efficacy of planning in science and in the benevolent role of

the State has also been shaken. Most of the States of the Third world have taken
on vast new functions in economic, management and the provision of public
services. The size of their bureaucracies has expanded and so have their budgets,
but many have proved to be incompetent of repressive and sometime both.
3) Public Administration is being looked now as a plural rather than universal
phenomenon. In the words of Esman, ―the Management of Central Bane, of a
research station, of postal service, or of a small irrigation system confronts the
analyst with different administrative requirements even within the same political
system. Regular (e.g. police), promotion (e.g. cooperatives), service ( e.g health
clinics), construction ( e.g. road building) activities directed at the same rural
public produce distinctive set of problems and require different treatment‖
The early developement theorists ignored the issues of agency – client linkage and the impact of
administrative action on the clients. This approach resulted in urban bias at the cost of rural
periphery.
The contribution of the comparative Administration Group (CAG)
It was Fred W. Riggs under whose chairmanship the comparative Administration Group was
formed in 1961 by the American Society for Public Administration. The CAG was made to carry
out research Comparative Administration with special focus on the problems of development
administration. The financial support to the CAG was given by the Ford Foundation which was
5
interested in the analysis of the relations between administrative system and its socio – political,
economic and cultural contexts.
The Group felt that as the classical concepts of administration in the third world were rigid,
narrow, and parochial and thus unfit in explaining for the cross – cultural situations as these
concepts were unable to answer the irrational, informal, and emotional behavior of
administration. Further, the postulates of conventional organizational theory were suitable only
for ― maintenance needs‖ rather than for ― development needs‖ The technological – managerial
school having emphasis on planned and managed change, was challenged by the Ecological
School which insisted on relating the organizational structures to other social structures. It
resulted into the idea that sociological context of administration is more relevant than mere
‗organizational changed and personnel manipulation‘
The scholars in CAG insisted on a comparative analysis of the administrative systems of the
third world. The Group also advocated concentration on the strategies and requisites for attaining
public policy goals in the developing countries. The Group evolving committee system published
more 100 occasional papers. It is a fact that the Group initially shared the assumption of
technical assistance experts, but it was not without questioning. The studies carried out by the
CAG assumed Developmental thrusts in the context of a ―belief in the possibility of (initiating
and) managing change by purposive intervention by administrative institutions.‖ As a result of its
efforts, the group was able to innovate many concepts viz: Systems Analysis; Patterns
Variables, Traditional – Modernity Dichotomy, Information Theory and Pluralism.
The 1960s ushered in a period of evaluation of results, doubts and repletion of old strategies. It
was also a period of a search for new concepts or analytical constructs which have cross- cultural
validity. The public Administration academics sought alternative approaches to development
administration. They sought to examine the relationships between public Administration and
social, economic political and cultural environment IN other words public Administration was
seen in ecological perspective The most renowned exponent of this approach ash been Fred
Riggs We shall discuss his views in some detail below.
The Contribution of Fred W. Riggs
Riggs has criticize the development administration model by observing that GNP increase may
not necessarily lead to improving the real life conditions of the people Thus increase in the per
capita income does not serve as an indicator of development. He has rather preferred the physical
quality of life indicators and social and psychological quality of life index as the success of a
development policy.
Riggs has analyzed the structural functional features of the social and administrative systems of
the developing countries in his industrial – transitia –agrarian formulation He puts the
developing countries in the category of prismatic society which is caught in between tradition
fused and modernity detracted and is undergoing the process of social change. The ecological
6
approach provided a vision that reflected interest in the examination of the relationship of non-
administrative factors to administrative ones. Administrative aspects, it is argued, cannot be
explained and analyzed in their abstract forms where effective behavior, despite the
establishment of formal political and administrative institution, is still guided in modern
traditional societies, to a great extent, by traditional structures and pressures, family, religion ,
region, caste and persisting socio- economic programmes. The strong primary group affiliations
and conservative mode of thought, where not much importance is given to the factors of
accuracy, promptness and time have behavioral implications.
3.4 The Empirical Approach to Development Administration

The period of the 1960s also saw a shift from normative approach to empirical approach. This
approach was undertaken to make an assistance enterprise of the United Nations and other
agencies The fundamental units of analysis were the structures and their functions in different
systems having parallel characteristics. It is in contrast with the normative approach in which the
main aim is to prescribe ideal or at least better patterns of administrative structure and action.
This approach is implicit in most of the so- called principles of public Administration works of
Woodrow Wilson L.D white Fayol, Gullick, F.w. Taylor and others. It reflected American
practice as a model, especially for the people of the third world countries. This category
includes numerous reports and studies by experts, visiting consultants, technical assistants, and
by some western trained Public Administration specialists of the new states The basic
orientation is the quest for ideal patterns and the identification of difficulties and obstacles to be
overcome and problems to be solved such endeavors seek to identify the universals of the
administrative process.
The Thrust in the 1970s
Review of Development strategies of the 1960s
By 1970s not only the meaning of development underwent change in so far as development
goals‘ were conceived in terms of meeting basic human needs but also the development
administration model, to meet these objectives, saw changes in strategies and substantive
programmatic actions. The shifts in the approaches to the study of the theory and practice of
development administration were also discernible, Public Administration shed its love for uni-
directional emphasis .This period of the second U.N Development Decade, however, began in
the background of report of the commission on International Development on Technical
Assistance Programme in 1969. The report has made it vividly clear that the focus of the of the
1960s on administrative modernization depicted as a technical process involving the expert of
western administrative methods, Procedures and practices to the newly independent states needs
a review and recast. It has been pointed out that the local people were, though poor, yet not so
irrational in decision- making. The development administration problems were rooted in the
political economy of the aid receiving countries and stressed on inter- theoretic linkages to social
explanation.
7
The political Economy Approach
Many scholars sought to explain the dynamics of societal transformation and management of
change by undertaking political – economy approach which attempted to seek politics –
administration union and economics –administration influence. It was asserted that
administrative questions are political questions. The political economy paradigm seeks to relate
administration to political and economic environment. This paradigm which is concerned with
both political and economic dimensions of decision – making and resource allocation deals with
―organizational constitution‘‘ and ―internal polity.‘‘ In the words of Mohit Bhattacharya,
―Theoretical Formulations in line with the classical study of political economy- explore
relationship between political and economics power in society.‖ The political- economy
approach sub serves ―goal paradigm‘ and ‗rational model; these new concepts refer to the
concepts of power and action. The thrust of the paradigm consists in examining development
administration in the context of power- relationships and in terms of the real process of conflicts
and their resolution. The political- economy paradigm provides for the analysis of the context of
administration.
The Ecological Approach
Many a scholars have attempted to understand development administration with an ecological

perspective. The ecological approach has been applied to relate Public Administration with
social economic and political-cultural structures of the country. It has been argued that
development is a holistic concept. There is a growing realization that political development is
necessary for national development and administration. Thus political environment acquires a
special significance in relation to the ability of Public Administration to play its role in the
national development. The politics- administration dichotomy principle is not a favored principle
now specially in practice. It is a known fact the administration play a decisive role both in policy
making and its implementation. On the other hand political environment provides a conditioning
effect on administrative environment in so far as effective and efficient administrative
performance requires the support of political executive. Even the question of administration
reforms is a political question. Moreover, it is stated that development is dependent on strong
political institutions and practices. If the bureaucracy is more developed than the political
leadership and structures, it might lead to negative impact on development efforts. It may be said
that political context provided strategic opportunities for accomplishment. This political
framework must be taken into account while studying development activities.
The cultural context also plays an important role in determining administrative performance.
Both goals and methods shall have to be reacted to this ecological faction in the words of M J
Esman, ―At both project and programme level of actins behavior that produces and protects
innovation depends on combinations of sanction and incentives that meet the tests at political and
cultural feasibility. Available incentive and sanctions are not only individual and economic but
also collect ice and non- material, the latter especially are derived from indigenous culture and
8
experience.‖ The point here is that special characteristics of a county prescribe different role for
its government and administration. It is equally important to have the economic and sociological
understanding of administration in developing countries. The economic and social dimensions of
development administration are part of the process of nation- building and socio-economic
progress.
The administration creates condition for economic development by mobilization and better
utilization of resources on the one hand and by determining the extent and context of social
development has also been recognized in the 70s. Many organizations have argued for
introducing programmes and policies and evolving relevant strategies to bring about change in
the minimum standards of living of the people and to ensure human dignity. The emphasis here
is on the reduction of poverty and improved delivery of social benefits like education, health,
nutrition, transport etc. and removal of socio- economic disparities in the society.
3.5 Basic Needs Approach to Development Administration

By the end of 1960s and early 70s, it was experienced that poverty, hunger, squall or
unemployment has been on the rising scale despite achievements in the area of economic growth.
The role of human factor in development process began to attract the focus of the students of
development and development administration. How to provide the millions and millions of poor
people with the bare minimum of life became a major concern of the scholars as well as the
policy makers. Meeting the basic needs of food, clothing and shelter, along with education and
public health became the indicator of development. Thus development acquired a social and
economic meaning during the U.N second Development Decade (1971- 8) instead economic
growth. The concern was obvious for qualitative change rather than the quantitative one. It was
realized by the develop mentalists of this period that the Gross National Product model has
benefited only a small minority of the rich and a privileged persons who were already an
entrenched class. The need for new economic framework and accordingly a new approach to
development administration was the economists like G. myrdal argued in favor of social and
institutional preconditions for progress. This called for the adoption or creation of new state as
well as group of scholars from Third World Fourm also advanced the new framework of
development, more so in the year 1975 when they met at Karachi. The development ideology, as
has been mentioned by Marc Nefrim, was characterized need orientation, ecological
orientation, self- reliance orientation, rural development orientation based on development
and creation of endogenous technique and institutional structures. The objectives of
development were identified as reduction and removal of poverty, inequality, hunger, squall, or
disease, illiteracy, unemployment and malnutrition. Thus, the impact of economic growth
occupied central place in the increase of the production of goods and service parse. In other
words, the problem of increased production was to be seen along with the problem of distribute
justice the process of efficient and fair social choices became a matter of analyze the students
and practitioners of Public Administration. Anti- poverty planning policies aiming at the
9
removal of disparities were treated as key elements of this developmental thought N. Islam and
G.M Henault have presented this shift as follows:
Shift
From To
Industrialization Agriculture
Urbanization Rural Development
Market determined priorities Politically Determined Basic Needs
GNP per Capital Welfare of Individual
Capital intensive Labor Intensive
Top Down panning Participative Interactive planning
Parallel Development of Sectors Integrated Development of Sectors
Foreign Dependence Self – reliance
Advanced Technology Appropriate or intermediate

Technology or Inherent Technology
Economic orientation Socio Economic Political Orientation
Service Orientation Rural Production- welfare Rural
Development Development
De bureaucratization and participatory management were regarded as the appropriate strategy to

implement this shift. The development of regional, local and sectoral structures was focused
upon rather than central organizations.
Moreover, rural development became a new management strategy for development. The
implication is the design of a strategy to improve the socio –Economic conditions of the life of
the rural poor. The key element of this approach are satisfactions of the basic needs increase
in production in the agricultural sector, development of labor intensive technology
immigration, marketing facilities and assistance, seeds and fertilizers to the peasants and
10
small and marginal farmers. However, the problem is to find an appropriate organizational/
administrative model to achieve these goals. Some scholars have suggested the following
strategy for development:
1) Decentralization and Devolution: Decentralization in administrative language means

delegation of authority from the function department to the regional; and local to
formulate and implement projects, to allocate funds and to raise resources.
Decentralization is also political when provincial, regional and local government work
under autonomous regions of authority and functions Devolution of powers and
authority implies creation levels having freedom to plan and implement development
projects and programmers
2) Strengthening of local self governments and creation of intermediate organizations.
3) Peoples‘ Participation in plan formulation and implementation.
4) Development of communicational coordination and integration channels.
5) Removal of negative socio- political conditions e.g. rural, social and class structures –
persistence of dependency- relationship- factional politics.
The Trends in the 1980s
The 1980s present a third world of development administration in which attention has been
given to indigenous concepts, methods and theories of developmental and administration
Arvind Signal mentions two contemporary approaches to development:
(1) Pluralistic, recognizing many pathways to development
(2) Less western in their cultural assumptions.
The works of Roger, Korten and Klaus, Bjorn, Bryant and White have identified the following as
key elements of the modern approaches to development administration
 greater equality in distribution of development benefits;

 popular participation, knowledge sharing and empowerment to facilitate self –
development efforts by individuals groups and communities;
 self- reliance and independence in development emphasizing the local resources
mobilization and use;
 the problem of containing the population increase and
 integration of appropriate technology with big modern technologies in order to facilitate
development.
Development administration theory today focuses upon the involvement of non – government,
voluntary and community organization in the
Development process and emphasizes localized, decentralized and participative approach to

development administration. The shifts in development administration theory in the 80s have
11
well summarized by Singhal who sees Learning process Approach and people – Centered
Approach replacing Blue – Print Approach and Production Centered Approach respectively
A) Blue- print Approach to Learning – Process Approach
The conventional development administration theory was concerned with preparing blueprint
for administering a development programme. This approach involves designing a specific plan of
action in advance for implementing a development project. Lately, this approach was found
inappropriate in as far as it is rigid and closed and therefore, unable to respond to the needs of a
changing environment. Hence, many scholars prescribe a Learning process approach which is
not only a relatively open-ended strategy to plan social change, but also involve a cybernetic
process by which development administration can adapt themselves to changing environment
and incorporate mid – course corrections, based on exiting local conditions. Distinguishing the
two approaches, A. Singhal states, ―The blue – print approach emphasizes advanced planning
for the people. The learning process approach emphasizes planning with the people and doing so
during the process of administering a development programme. ‘‘The philosophy of action –
learning repudiates the management theory and lays stress on learning by experiences of each
other. The action- learning approach attempts to look at oneself and others around oneself and
seek solutions rather than look beyond the shares for chosen people to raise them from
impoverished conditions in which they live.
B) The participatory Approach to Development Administration
This approach is also termed as people-centered approach. The approach stresses up peoples‘
empowerment and promotion of psychological strength so as to enable the people relate
themselves with the officials on a partnership basis. It is based on developing community action
through people. The key elements of participatory approach include:
 respecting the ideas of employees and the beneficiaries without evaluation or

criticism;
 raising of certain diagnostic questions of what the administrators are doing
 stimulating ideas from all levels and acceptance of good ideas for implementation;
and
 attitudinal change by different ways and close observations and discussions among
officials and the people.
The major theme of participatory or people – centered approach is the growth to capacity via
equity. It concentrates on the distribution of development benefits economic as well as social.
Equity became a primary issue in development plans and programmes. The concern for equity
reinforced participation and micro-level concerns. These concerns focused on direct attack on
poverty and rural development. The set of priorities in the people-centered approach, says
Esman, includes:
12
1) an emphasis on reaching large mass of public often in remote areas

2) development progrmmes that responsive to their very diverse needs capabilities and
preferences
3) organizing the public so that they may interact more effectively with the service
providing agencies of the State;
4) development to constituency organization and the fostering of local action capabilities
5) innovation of appropriate services and practices in support of basic needs strategies, not
the plantation of established and replicable techniques However may mentioned here that
some western administrative methods and participate Like record keeping, monitoring
and reporting methods public information procedures etc may provide useful assistance
to programmes to oriented to poor masses
The participatory approach to development administration provides a link between beneficiary
needs, programme outputs and the efficacy of the assisting agency. The effective popular
involvement in decision making and decision- implementation through local skills, knowledge
and institution, like local self governmental institutions or voluntary agencies, is given
importance.
Features of Development Administration
There are certain distinct features of development administration. We would now discuss them
briefly.
Change Orientation
Development administration cannot be status – quo oriented. No development can take place
unless and until it introduces certain positive changes in a system. Changes such as structural
reorganization of administration, innovative programme to increase production remove
unimplemented, poverty etc, new schemes to improve employer employee relations must form a
part of development administration.
Goal Orientation
Developing countries are facing the problems of poverty, squalor, injustice, unequal distribution
of wealth, lopsided agricultural growth, underdeveloped technology etc. These colossal issues
need to be tackled systematically by fixation of priorities and goals. Development administration
is the means through which the goals of development viz, social justice, modernization,
industrialization and economic growth can be achieved.
Innovative Administration
Development administration focuses on replacing/ improving the existing governing structures

and norms with the ones that suit the changing political and social environment. In other words
development administration is one that is dynamic and progressive in thought and action, it is
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interested in identifying and applying new structures, methods, procedures, techniques, and goals
of development are achieved with minimum possible resources and time.
Client Oriented Administration
Development administration is positive oriented towards meeting the needs of the specific target
groups, like small and marginal farmers of landless agricultural laborers and rural artisans in
India. The socio – cultural and politico – economic progress of these sections forms the essential
basis of performance appraisal of development administrators. Many target groups centered or
beneficiary –group oriented organizations have to be created so as to provide these under
privileged sections the requisite goods and services. It has been suggested that development
administration is people – oriented administration which gives priority to the needs of its
beneficiaries by preparing receiving and, if necessary, changing the programmes, policies and
activities aimed at the satisfaction of the needs people in question. The administration is
involved in the betterment of the lot of the deprived and the weak their upliftment becomes a part
of the whole administrative ethos. The welfare of the weaker sections is a part of the
administrative ethos the welfare of the weaker sections is a part of the administrative values. This
feature points out the human character of administration. The members of any development
organization are highly motivated and committed to a progressive philosophy aiming at cutting
the roots of vested interests in the society. This possible people of initiative, extra dedication and
perseverance are inducted into the development administrative structures. Training of personnel
can be one effective method of creating such a team development administrators should not just
formulate plans for the people but even monitor them in such a way that the beneficiaries are
actually benefited.
Participation – Oriented Administration
Development administration accepts for its purposes the principle of associative and participative
system of administration. Here, people are not treated ad mere passive recipients of benefits of
goods and services They are taken as active participants in the formulation and execution of
development plans, policies and programmers It is recognized that centralized administration
will not only be unable to take cognizance of local problems in a realistic frame, but it would
also be deprived of the us of local initiatives, energies and resources. Hence, effective
formulation of programmes and their implementation with the help and association of the local
people is now a well recognized principle of administration, It involves giving people an
increasing share the governance and management of developmental affairs of the government
Effective e Co- ordination
Since development implies increasing specialization and professionalisation, the number of

agencies and organizations involved in development tasks has considerable gone up. In order to
have the maximum benefit of this emergent administrative system, coordination between
various administrative units and activities is essential to achieve maximum results, wastage of
14
resources, time and cost has to be avoided. Development administration has to coordinate the
activities of development agency and organizations to integrate their efforts and energies for the
realization of development goals. This would even the administration from the problems of
duplication of functions, neglect of important functions and unnecessary focus on irrelevant or
marginally relevant activities. It would thus minimize administrative la
Ecological perspective
Development administration shapes the environment – political, social and economic and also
gets affected by it in turn. It is not a closed system. It receives a feedback from the social system
and responds to the demands put on it by the system. In a development administration is related
to the environment. The environment sets for the operative parameters of development, the
environment sets for flexibility and responsiveness in administrative actions and methods. The
changes of administration affect its environment and changes in environment also have its bear
on administration.
3.6 Scope and Significance of Development Administration

Scope of Development Administration
The scope of development administration is expanding day by day. Development administration

aims at bringing about political, social, economic and cultural changes through proper planning
and programming, development programmes and people participation. To achieve these
development goals the administration constantly interacts with environment. It shapes the
environment and as also shaped by it.
In this section we would briefly highlight the scope of development administration
Development Administration is Culture - Bound
There is a close link between administration and culture of a country. The culture provides an
operational framework for administration framework for administration. The administration, it is
said is affected by the political leadership that guides it and the developmental policies that it
implements. It cannot easily or rapidly break away from the compulsion of historical legacy or
the resources of the economy or the behavior patterns in society. However, it does not imply that
cultural system of a country is static. Rather, both the cultural and administrative systems can
change can definitely usher in cultural change. For that purpose it should also be able to prepare
suitable plans programmers and [projects keeping in view their feasibility, operationality and
desirability. Development administration should serve as a steering wheel that directs society to
pre determined goals according to the will and skills of the leaders and personnel engaged in the
development process It removes the lag between development requirements and administrative
development.
Wide Spectrum of Development Programmes
15
The spectrum of development programmes, the central theme of development administration, is

very wide ranging from provision of industrial and infrastructural Development programmes to
programmes relating to development of agriculture, health, education, communication, social
services and social reconstruction (e.g.) community development family planning etc.) Thus
development administration covers a whole gamut of the multifaceted tasks of administration
and management of development programmes.
It may also be mentioned here that the principle of politics and administration dichotomy cannot
be accepted for the purpose of development administration as the formulation of policies and
programmes about development are intractably related to their administration. Otherwise, for the
purpose of development as the formulation of policies and programmes about development are
intricably related to their administration. Otherwise, for unsound and vague policies and
programmes, the implementing machinery should not be held responsible. The fact, however, is
that the people blame administration, for its imperfection in or incompetence of administration in
implementation of a programme. The source of failure can be policies and plans, administration,
management, leaders or people or all taken together. Development administration is an effort at
homogenizing all these institutions / agencies engaged with the tasks of development into a
unified system.
Nation – Building and Social – Welding
Development administration further involves the tasks of nation – building and social welding It
is concerned not merely with the function of creation or expansion of growth structures, (
institution / agencies established to achieve development) but also to mould social behavior or
reconstruct social structures. Many a countries of the third world tend to get affected by
traditional and parochial structures need to be broken and an era of modernization is to be
inducted into the society putting an end to the patronizing approaches of a traditional culture.
Hence, the focus of development administration is on expediting the process of industrialization,
urbanization, education and democracy. It is a recognized proposition that developmental
policies should identify and strengthen the strategic advancement, equity, justice, removal of
unemployment process have to be modified or done away with. The task of nation – building can
only be successful if development activities bring about social change.
Planning and Programming
Many countries of the world both developed and developing have opted for development
planning. This type of planning lays emphasis on the proper assessment of resources,
determination of plan priorities, formulation, implementation, monitoring and evaluation of plan
with an aim to achieve maximum results with minimum time and cost. These are all round
efforts to realize developmental goals provision of basic necessities, involvement of people as
the ends as well as means of development administration is vast and varied in developing
16
countries like India In fact the very survival of the government programmes depends on the
efficiency of the development administration to implement, monitor and evaluate them It also
stresses that planning should take note of the linkage between economic development normative
and geo-social positives.
Programming is yet another important component of development administration. Programming

is that process which throws out knowledge about gaps in information or skills needed and the
groups of people who have the necessary willingness to take initiative people‘s resistance to
change, it is believed can be easily overcome through a proper method or improved
communication technology A few words here about centralized and decentralized planning are
also called for centralized planning may be defined as an act of working out the priorities and
the pattern of programmes and schemes as related to content, and staff, finance, institutional
arrangements, locations and beneficiaries at the central and state levels. This practice is favored
in the name of administrative efficiency, effective supervision, avoidance of wastage, and
uniform assessment of performance.
Development Administration is Organic
Development administration, it is argued, cannot be conceived and operated as a machine made

of nuts and bolts. As development envelops and affects every aspect of life and activity in
society, administration for development must be conceived and approached as sub- culture
within a major- culture and with same responsibility to create a new culture appropriate for the
times dominated by science and technology, urbanization and material comforts, technology
affects and is affected by administration. This approach suggests a systematic study of
development administration Human element forms an important part of development
administration. Development administration comprises human beings at all levels planners seek
to achieve development goals with the help of people. People‘s participation is required at the
time of determination of priorities for plans, formulation of plans, implementation of plans by
various development agencies and evaluation of plans and programmers. The idea is to reach as
many possible.
The development administration is organic, it does not work like a machine following set rule
and regulations and working in a predictable and routine manner. Though a proper and
systematic planning process is an essential component of development administration, it does not
have to rigidly adhere to the process.
3.7 The Ideals of Development Administration

Development administration, as has been made clear many times, is not merely interested in
economic growth. Rather, its objective is economic growth with social justice. It works for the
purposes of a social order based on the principles of equity, justice, freedom of offering equal
opportunities to all. The facts that all ―major decisions regarding production, distribution,
consumption and investment and all other important socio – economic relationships must be
17
made by the agencies committed to social purposes. It works on the premise that wealth and
income should be equitably distributed among various people of the society. The philosophy of
development is that benefits of economic development must accrue and more to the less
privileged classes of society and there should be progressive reduction of the concentration of
income, wealth economic power. However, the methods and approaches to bring about this
changed process must be compatible and effective within the environment in which change must
take place.
Institution – building
The tasks of development administration are not confined only to the formulation of plans,
policies, programmes and projects, but it also includes creation of suitable institutions to
accomplish the objectives of development. The term institution means planning, organizing,
implementing and evaluating, through well designed structure. In the words of Donald C.Stone,
we use this term to identify the process involved moving from an objective to be accomplished to
the actual creation of the organization, service system, new practices or relationships which
evidence that change has actually taken place. A different set of organizational values and
constructs are therefore necessary to tackle the tasks of organizational values and constructs are
therefore necessary to tackle the tasks of development administration, have been in the form of
Community Development Programme.
Administrative Development
The administrative aspect of planning and development in terms of building up adequate

administration capacity and capacity is another integral integral part of development
administration. In structures, attitudes, skills and behavioral, administration organizations are
taken as essentials for the purposes, a proper arrangement for training of administrators engaged
in the task of socio- economic and cultural transformation of the society is called for.
In sum; it is concerned with responsiveness, imagination and innovativeness. It aims at creating

a people – economic cultural transformation, a sense of dynamism, flexibility, democracy,
responsiveness, imagination and innovativeness. It aims at creating a people- centre
administration replacing the colonial attitudes of authoritarianism and rigidity idea is to bring
the administration closer to the people, to make the administration responsive to the people
and to make the people an integral part of administration you have read in the previous unit
development of administrative capacity and capability to carry out administrative programmes is
a necessity for development simplification of procedures and techniques of work so as to make
them comprehensible and accessible to the people who are mainly ignorant and illiterate
administrative development aims at building a new generation of men and women trained and
motivated to operate a modern society.
Communication
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Communication has become a watch word for development. It assumed more importance
because new ideas are introduced into a social system, committed to bring about a social change.
In order to produce higher per capita income and to change levels of living through more
modern production methods and improved social organizations, patterns of communication
acquire and significance It would difficult to address development goals without an effective
communication net work. It is through the process of communication that transmission of
information, decisions and directions among factors takes place and knowledge, opinions and
attitudes are formed or modified. In the words of Pfiffner and Presthus, ―administration can be
viewed configuration of communication patterns relating individuals and collectivities ( groups)
of varying sizes, shapes and degrees of cohesion and stability‖ However communication for the
purposes of development administration, may mean development communication i.e.
communication of messages
Related to all aspect development programmers moreover communication an integral component

development administration, is both vertical and horizontal in addition to being formal and
informal of written and oral one.
Participatory Development
The concept of development administration is based on the premise that people have an immense
capacity t contribute to development. That is why a renewed stress is laid on the need to involve
people more actively in all stages of development planning, implementation, controlling and
evaluation. Participatory development implies development of the people by the people. The
success of policies, programmes and projects depends to a larger degree on the success in
obtaining more and more participation of the beneficiaries in development process.
In other words, the focus of development administration is on seeking people's involvement at all
the stages of development. The voluntary associations, interest groups, pressure groups and
beneficiary organizations are encouraged to participate in both plan formulation and execution.
This is so because the governmental agencies involved in the task of progressive mobilization of
the society alone may not prove to be suitable instruments for the job. Though, the concept of
popular participation in both plans formulation and execution. This is so because the
governmental agencies involved in the task of progressive mobilization of the society alone may
not prove to be suitable instruments for the job. Though, the concept o popular participation in
development emerged in more developed countries, the societies of the third world have also
perceived its relevance for achieving fast rate of development. The implication of all this
reference is that participatory development process is the key factor in development
administration because it is the only way qualitative development ca take place.
Our centrally sponsored schemes for rural development and poverty eradication have not been
much of a success. The lack of success is not due to faulty premises underlying the schemes but
the fact that we have not been able to involve people in the formulation, implementation and
19
evaluation of these schemes to a needed extent. These programmes have been in a way imposed
on rural people without taking into due consideration, their requirements and needs. The
suitability of a scheme in a particular area has also been overlooked. The emphasis has been on
completion targets rather than actually helping people. To give an example, TRYSEM (Training
Rural Youth for Self Employment) has been introduced in areas where people are more inclined
towards wage employment. No development programme can achieve its targets if it does not
keep in view the needs of the people, the beneficiaries and all those affected. Development
programmes must also try to satisfy the basic needs of people such as food, shelter, clothing and
health.
Development Administration as a Process
Development administration is also a process which involves, as mentioned by J.Khsla, four

crucial elements:
 Development goals and their feasibility

 Development policies and programmes
 Organizational logistics and personnel to implement these programmes, and
 End results. This dimension of development administration further stresses on (a)
'treating administration as one of the resources in the planning process;
(b) working out in operational terms the administrative requirements of
each developmental programme or activity;
(c) formulation a clear cut scheme of priorities as between the

different developmental goals and objectives; and
(d) designing an effective strategy of implementation'. Thus development follows a

proper plan procedure.
Co-ordination
As we read in the previous section also, co-ordination is a basic component of development

administration. It is taken as a means for planned change. Development administration has to
establish co-operation and co-ordination at various levels of governmental organizations and
functioning. According to V.A. Pai Panandikar, 'the key formula of development administration
could be expressed in the initial letters of co-ordination of resources through organization of
personnel and procedures i.e. CROPP (Co-ordination, Resources, Organization, Personnel and
Procedures). In development administration it is the key factor because scarce resources seldom
permit overlapping or wastage without serious damages to developmental pace and process".
Alternatively, development administration focuses on 'management of scarcities' or 'optimizing
opportunities,' through better co-ordination and utilization of resource inputs. There is no areas
of development where co-ordination i.e. structured formal co-operation and cultivated informal
co-operation does not permit and determine the tone and tempo of development. Indeed, success
20
in development administration could be measured by the degree of coherence and co-ordination

achieved in administration.
3.8 Significance of Development Administration

We have seen in the foregoing discussion how the concept of development administration has
served as a means of comprehensive analysis o the problems of development and the necessary
requisites to meet these challenges, The emphasis on a multitude of dimensions of development
and the administrative inputs in terms of skills, attitudes, behavior and structure required have
clearly added to the understanding of the multi-disciplinary linkages of change and development.
The sub-discipline of development administration has been able to draw the attention of the
scholars of Public Administration as well as its practitioners to the fact that the western models
and concepts of Public Administration may not be wholly applicable in the context of the
countries of the third world. Since the nature of the problems of these countries is different from
the ones in developed countries, it requires a different set of administrative answers too.
The emphasis of development administration on the ecology of administration has not only
brought to light the need for synchronization of political, economic and socio-cultural aspects of
development, but also the vivid contextual character of development administration. It lays stress
on developing indigenous administrative means, procedures, methods and techniques to meet
multifaceted challenges thrown by the pressing demands from the new environment' upon the
State. The State also has to provide leadership to improve standards of societal living.
Development administration, further, calls for now perspectives, insights and understanding. It
promotes democratic spirit in administration and includes people's participation in the
management of developmental affairs and processes of social change as a technique. Newness in
thought, action, organization and behavior is the crux of development administration. It calls for
higher standards of group performance, inter-group collaborations and participative
management. A high degree of achievement-motivation and a continuing innovation of
organization to meet environmental change and internal needs are also called for.
The study of development administration makes it explicitly clear that politics administration
dichotomy is a myth and in an era expanding science and technology, knowledge explosion, the
clear functional demarcation between politics and administration is neither desirable nor possible
It may be mentioned here that development administration has served as a useful construct to
explore the dynamics of change and administration in the developing counteract of the third
world. It is a fact that administration has fallen short of development aspirations. Development
administration seeks to fill the gap between developmental needs and administrative responses. It
also seeks to lay its hand on certain common themes in the area of administration and
environment of different countries. Hence it is a move towards contributing to development
organization theory.
21
It helps us to find answers to the following questions:
 What is location of the clients?

 How to identify their needs?
 What structural and behavioral changes are required to construct a new social order based
on the principles of dignity of human being guided by the principle of fraternity and
equality?
 How to bring about the desired change in society and administration
 How to raise the level of administrative and political capabilities?
Chapter Four
New Public Administration/ Management (/Npa/Npm)
ORIGINS AND HISTORY

The New Public Administration revolution has sparked unprecedented interest in attempts to
reshape and improve governance and public administration. The NPA movement has been
essentially an attempt to unify politics and public administration. Like many other disciplines in
social sciences, public administration was also shaken and influenced by social turbulences. The
civil rights movement and the antipoverty programs reawakened the concern for the influence of
public administration to bring changes and make differences.
The impetus for such programs and movements came from great power competition,
international humanitarianism, and appeals for help from developing countries, mainly from
newly independent ones, after the end of the Second World War and the accompanying de-
colonization. There was an ideological scramble of the newly independent states by the West
(Capitalist) and East (Communist) poplars so as to attract or otherwise protect these countries
from joining the other side of ideological category.
The rivalry between capitalist and communist categories made confused governments of the
newly independent countries and caused them to fail from satisfying the interests of their
citizens. That in turn brought about conflicts between governments and citizens, continuous riots
and social unrest, etc in those countries, which alarmed public administration that the worsening
trend had to be changed.
Further, government reforms forced many scholars in the 1960s to rethink about their initial
premises, which assumed automatic development and improvement in the lives of the poor in
more than two medium-term plan periods after independence of colonized countries. Instead, the
poverty and misery, dictatorship and citizens‘ rights violations exacerbated even more deeply.
Following, therefore, came changes in the premises of scholars, which directed attention in
public administration toward political or policy-making processes and specific public programs.
The crisis-driven period of the sixties was, therefore, the first incident for the evolving discipline
of public administration to be enriched by the emergence of what has come to be known as the
22
"New Public Administration-NPA" movement. Rumki Basu (1994) says that the failure of
development administration has led to the term ―new public administration‖ (and its current
version, the new public management) in the 1970s, which came to be associated with the
advocates of ―public choice economists‖ and the move to privatize various parts of the
government.
Nevertheless, it would be important to note that NPA is not a complete replacement of
development administration rather they coexist concurrently. Hence, there is a notion that public
administration has been steadily progressing towards a unanimously accepted and universally
applicable managerial practice. The New Public Administration (NPA) movement called on the
profession to shift from its historic emphasis on programmatic efficiency toward advocacy for
the poor, for the minorities, and for disadvantaged social groups as well as toward the reform of
governmental structure that perpetuated their disadvantages.
Particularly, the later (current) version of NPM; i.e. new public management (NPM) propagates
change to realize the common good of nations. NPM is a managerial revolution, pursuing change
and reform to take place in the public sector that has affected a number of countries around the
world. The theoretical perspectives of NPM suggest that the goal of reforming public sector
institutions and processes is to maximize public choice opportunities and minimize agency costs.
There are common statements of scholars even within the discipline, that the new thinking in PA
has no an independent and well-elaborated paradigm as well as a body of literature in its own
merit. No new synthesis has occurred sufficiently, and comprehensive theory is still lacking.
Even extreme critics goes as there are no substantive evidences that such a new paradigm has
emerged fully to date except that attempts have been made to take some models from economics.
There are also disparities in naming the new thought and in locating its exact period of
emergence.
For this reason, we find "New Public Administration" and "New Public Management" being
used interchangeably. However, the interchangeability of NPA and NPM may not be
comfortably accepted by those people who argue management is different from administration in
that administration means following instructions and management means the achievement
efficiency.
Despite such critiques and disparities, NPA has brought about a radical transformation in the
history of the discipline in terms of identifying problems and proposing actions towards
providing solutions, clarifying confusions and establishing understanding of the concept,
determining the scope and method of applications etc. Among the grand works that served as a
milestone for the emergence and growth of NPA, the following deserve acknowledgements:
 The Honey Report on Higher Education For Public Service (1967) in USA,
 The Philadelphia Conference on the Theory and Practice of Public Administration (1967)
in USA,
 The Minnowbrook Conference (1968), in USA,
23
 Frank Marini's (ed) Publication of "Toward a New Public Administration: The

Minnowbrook perspective" (1971),
 Dwight Waldo's (ed) Publication of "Public Administration in a Time of Turbulence"
(1971),
All these works were presented within five years period and have been thoroughly and
intensively dealt with to get public administration into major transformation. The fundamental
contributions of these works to the emergence and growth of the NPA could be summarized in
the following manner.
(i) Honey undertook an evaluative study of public administration as an academic discipline in the
US universities, and identified four problems confronting the discipline that needed immediate
action.
(a) Inadequacy of funds at the disposal of the discipline
(b) Uncertainty and confusion over the status of the discipline (is it a discipline, a science, or
a profession?)
(c) Institutional shortcomings (inadequacy of public administration departments)
(d) Lack of communication between public administration scholars and the practicing
administrators
(ii) In the same year (1967), American Academy of Political and Social Science organized a
conference in Philadelphia cognizant of the new appraisal requirement for the rapid development
that took place in the field.
The conference discussed on "the theory and practice of public administration: scope, objectives
and methods". The following points, among others, gained broad consensus from the conference:
(a) Definition of the subject is as difficult as delineating its scope
(b) The policy-administration dichotomy is erroneous
(c) The training of administration in public administration and Business Administration
should not be combined since they are similar only in unimportant aspects
(d) Public administration as a profession should remain separate from the profession and
discipline of political science
(e) A hierarchical view of organizational authority needs to be changed; administrators
must view workers as "coordinate" rather than "subordinates"
(f) Future administrators should be trained in professional schools; public administration
courses should emphasize not only administrative organization and procedures but also
an interdisciplinary approaches
(g) Failures of public administration to deal with social problems in the past should be
redressed.
(iii) The Minnowbrook conference was an academic get-together, which gave rise to what has
come to be known as NPA. The origin (genesis) of the conference lay on two factors.
 First, inability (failure) of public administration to be aware and serious or earnest to
solve the numerous social problems aroused from the 1960s turmoil.
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 There was a need to hear young scholars and practitioners of the discipline as public
administration was facing a kind of generation gap.
The literature on NPA lays emphasis on four major themes; i.e. Relevance, Value, Equity, and
Change.
A) Relevance
Public administration has traditionally been interested in efficiency and economy. The NPA
movement has pointed out that:
 The discipline had little to say about contemporary problems and issues and was therefore
becoming irrelevant
 Management-oriented public administration studies was found inadequate to address
social problems, and the demand was to deal explicitly with the political environment and
implications of administrative actions
 Radical syllabi change to facilitate meaningful studies oriented towards the realities of
modern day public life was demanded imperatively
B) Value
The NPA movement made clear its basic normative concern in administrative studies. It rejected
the value neutral position taken by the behavioral political science and management-oriented
Value neutrality in public administration was declared as an impossible and the discipline
advocated the cause of the disadvantaged section in society. The champions of the new
movement advocated openness, about the values being served through administrative action.
The movement stated NPA should be:
 Less "generic" and more "public"
 Less "descriptive" and more "prescriptive"
 Less "institution-oriented" and more "client-impact oriented'
 Less "neutral" and more "normative"
C) Social Equity
The protagonists of the NPA clearly stated that the distributive functions and impact of
governmental institutions should be PA's basic concern. The purpose of public action should be
the reduction of economic and social disparities and the enhancement of life opportunities for all
social groups inside the organization. Action-oriented Writers of this movement have called
upon public administrators to work for the removal of the wrongs of society and openly sided
with the socially deprived groups.
D) Change
One of the mottos of the NPA is that to serve the cause of social equity is to actively work for
social change. The attack is on the status quo and against the powerful interest entrenched (deep-
rooted) in permanent institutions. Advocates of the movement explored ways of institutionalizing
change and remedying the bureaucratic tendencies of big organizations.
Although the movement has been criticized as "anti-theoretic", "anti-positivist" and "anti-
bureaucratic", its positive value lies in bringing public administration closer to political science.
25
In fact the movement has been successful in integrating public administration with the basic
concerns of political theory.
The client-oriented, normative and socially conscious public administration, as promoted by the
new movement, is of direct relevance for the Third World Countries where public administration
is in urgent need of basic, qualitative transformation. The NPA, therefore:
 Displays an intense concern for relevant social problems
 Stresses on ethics and values, innovation and social equality
 Places great emphasis on human relations, a creative approach to administration and social
change
 Gives secondary importance to the study of formal organization, its structure and
processes
 Focuses on the contemporary social and political issues and problems with the view to
finding ways and means for their solutions
 Tries to bring organizational changes to suit the changing situations
The basic guidelines directing the change-oriented or the managerial approach of the NPA/NPM
include:
(a) Public administration practices need to be aligned to increasing orientation towards
changing realities
(b) Public administration should strive to influence policies, which can improve the
quality of working life, as well as to have competence to implement such policies
(c) Public administration should be more oriented towards measuring the impact of laws
on citizens rather than being satisfied by their mechanical applications
(d) Public administration should be more normative and less neutral
(e) Public management should shift its emphasis on procedure and input control to results
or output control
(f) Competition is desirable between service providers through market mechanisms
(g) Citizens should be redefined as customers to whom the public sector should be
responsive
(h) Government aught to ensure that public goods and services are provided rather than
produce those goods or provide services by itself
(i) Centralized hierarchical, bureaucratic control and monitoring of government operations
is not consistent with result-oriented public administration, and is to be replaced by
competition, customer services incentives, and accountability to customers
(j) Front-line operations should be delegated and empowered decision-making authorities
to exercises creativity and innovation in the pursuit of more effective services to
customers
(k) Public organizations should be as entrepreneurial, innovative and flexible as the private
sector.
Scholars of the new public administration have sought to borrow a lot from other disciplines,
making it truly inter-disciplinary in nature. For this reason, public administration has
26
incorporated new developments from the fields of policy sciences, new development paradigms
as originated from theoreticians and practitioners of the contemporary schools of thoughts and
specific fields such as development economics and development sociology.
Recently, the concern for social equity, comparative study of administrative systems, and
emphasis on the developmental goals of developing countries coincides with the renewed
acceptance of values and normative theory as basic features of the NPA.
As Western concepts and techniques often proved dysfunctional, in the administrative
environment of the new states, new approaches were needed. Hence, Riggs pioneered a new
administrative vocabulary to describe different social typologies, administrative cultures and
systems answering this need, known as the ecological approach to public administration.
Although public administration has shown remarkable development, particularly in the past four
decades, it achieved little success in bringing (in synthesizing) different ideas, views and
thoughts so as to establish common understanding of the subject. Hence, many issues still
remained unclear, in a state of confusion, under debate, controversial, and unsolved.
4.1 Features of the New Public Administration (Management)

New Public Administration is a quest for reform in the structure and role of government; it is
about issues related to ensuring legitimacy (law and order) and achieving economy and
efficiency; about citizens‘ empowerment and participation; about accountability, transparency
and responsiveness; generally about achievement of the good life.
New public administration is an array of ways in which the relationships between the state,
society and the market is ordered. NPA has a number of interrelated features from which the
major ones will be discussed as follows.
4.1.1 GOOD GOVERNANCE
In discussing this topic, we may need to capture common understanding on three derivative and
interrelated terminologies; i.e. Government, Governance, and Good Governance. The word
―government‖ originated from the Greek term used for the pilot of a ship and suggests that to
govern means to ―steer‖ a society‘s evolution over time. As we commonly use the word,
government has two general meanings. First, it is a legal organization that maintains order in
society and provides the goods and services that its citizens require. In this respect, it has the
authority to compel citizens to obey laws and pay taxes so long as they recognize that authority.
Secondly, we use it in the sense of governing, a process by which order is maintained and goods
and services are supplied (Johnson, 1992:5).
The term ―governance‖ is intended to reflect the broader concerns of the state and citizens, yet it
is a term without precision or agreed usage, as we can realize by examining a range of definitions
by different agencies. Governance is a very diffused and flexible concept interpreted or
understood in various ways. It is a multifaceted concept encompassing all aspects of the exercise
27
of authority through formal and informal institutions in the management of the resource
endowment of a state (Huther and Shah, 2003; Minoque Martin et al 1998:5).
According to Leila Frischtak (1997), Governance is generally defined as "the exercise of
political, economical and administrative autonomy to mange a nation's affairs and public
resources and an attempt to resolve conflicts at all levels. It is seen as encompassing the
mechanisms, processes, and institutions through which citizens and groups articulate their
interests, exercise their rights and obligations, and mediate their differences".
The most overtly political definition is that used by the Department for International
Development (formerly UK Overseas Development Administration) under the label ‗good
government‘. This sets out four main components:
(i) Legitimacy: implies that a system of government must operate with the consent of
those governed, who must therefore have the means to give or withhold that assent.
(ii) Accountability: involves the existence of mechanisms, which ensure that public
officials and leaders are answerable for their actions and use of public resources, and
will require transparent government and a free media.
(iii) Competence: in making and executing appropriate public policies and delivering
efficient public services is essential, while respect for law and protection of human
rights should buttress the entire system of good government.
(iv) Respect for law and protection of Human Rights: should buttress the entire system
of good governance.
An alternative definition is provided by the United Nations Development Program (UNDP,

1995) with the contrasting label of ―sound governance‖ with two significant variations of
interpretations from the definition of other agencies. First, UNDP places less emphasis on the
assumed superiority of pluralist, multi-party, electoral-oriented systems, recognizing that
different forms of political authority may combine efficiency and accountability in different
ways. Second, it recognizes that there is a problem about relative cultural values; i.e. systems of
governance may vary in response to different sets of values placed on economic, political and
social relationships.
A tricky definition of the World Bank (1992; 1994) prohibits political intervention and requires it
to take into account only economic considerations. Accordingly, the World Bank documents
emphasize open and predictable policymaking, a professional management capability, and the
effective use of resources to achieve improved level of social and economic development. Yet
the World Bank can scarcely avoid stepping into political territory while defining governance,
since it calls for the a strong participatory civil society and since it imposes political
conditionality on aid recipient countries for the application of its preferred economic policies.
Even there are blunt critics against the World Bank‘s general contention on ―good governance‖
as it involves highly ideological motives since it suggests that ―good governance‖ has an equal
meaning only to Western Liberal Democracy. The Bank tries to formulate simple and circular
28
equation to show that good governance = good decision-maker + good decision + good
implementation. Good governance is used as a magic password by multilateral donor agencies to
induce political changes on governments of poor countries.
If we compare the definitions by major aid donors, we see at once that good governance aims to
achieve much more than mere efficient management of economic and financial resources or
particular public services; it is also a broad reform strategy to strengthen the institutions of civil
society, and make government more open, responsive, accountable and democratic.
Debates about the appropriate role, policies and institutions of the state are often hampered by
the lack of uniform definition for ―good government‖. Thus, an attempt has been made to explain
the quality of governance as determined by the impact of the exercise of power on the quality of
life enjoyed by its citizens. In measuring the quality of governance, Huther and Shah (2003)
have developed indices for the government‘s ability to:
 Ensure political transparency and a voice for all citizens (the citizens participation
index measures political freedom and political stability).
 To provide effective public services efficiently (the government orientation index
measures judicial and bureaucratic (efficiency and the absence of corruption);
 Promote the health and well-being of its citizens (the social development index
measures human development and equitable distribution of income);
 Create a favorable climate of stable economic growth (the economic management
index measures outward orientation, independence of the central bank, and an inverted
debt-to-GDP ratio).
By applying these indices, Huther and Shah observed a positive relationship between fiscal
decentralization and quality of governance. Governance quality is enhanced by more closely
matching services with citizen preferences, and by moving governments closer to the people they
are intended to serve, which ensures greater accountability of the public sector. Generally, it is
important to note that the above bulleted points are the goals, which all governments can be
expected to pursue regardless of their country‘s wealth.
Table 1: Components of Governance Index

Index Name Component Indices Concern of Indices
Citizen Participation Political Freedom (PF) Assesses the ability of citizens to influence
Index (CP) the quality of governance they receive
Political Stability (PS) Assess the ability of citizens to participate in
governance decisions, which is a reasonable
indicator of continuity of citizen
participation
Government Orientation Judicial Efficiency (JE) All attempt to gauge the degree to which
Index (GO) public sector employees are focused on
Bureaucratic Efficiency (BE) serving the populace rather than enriching
29
themselves or their political parties

Absence of Corruption (AC)
Human Development (HD) Tries to combine estimates of life
Social Development expectancy, average education levels, per
Index (SD) capita income, etc
Egalitarian Income Distribution Tries to measure the degree of income
(EI) disparities among citizens or members of
the community
Outward Orientation (OO) Tries to assess the government‟s trade
Economic Management policy
Index (EM) Central Bank Independence (CB) Tries to assess the government‟s monetary
policy
Inverted Debt to GDP Ratio (DB) Tries to assess the government‟s fiscal
policy
The following are summative explanation and conclusion about the significance and implications
of the indices of measuring the quality of governance.
(a) Citizens‘ participation: ensures that public goods are consistent with voter preferences and
public sector accountability. Such participation is possible only if political freedom is
permitted and political stability is prevails. Studies in this regard reveal that there is
statistically significant relationship (correlation), which in turn suggests that citizens‘
participation and public sector accountability go hand-in-hand with decentralized public
sector decision-making.
(b) Government Orientation: plays an important role in public sector performance. If the public
service is oriented towards serving its citizens, bureaucratic red tape and corruption would
be minimal and judiciary will further enforce accountability through timely and fair
decisions in the administration of justice. While one may often find such orientation as
typically lacking in some developing countries where the civil service pursues rent seeking
power and bureaucratic red tape, studies generally suggest that decentralized countries are
more responsive to citizen preferences in service delivery and strive harder to serve their
people than centralized countries.
(c) Social Development: expressed in terms of human development and equitability of income,
is generally positively correlated with fiscal decentralization.
(d) Economic Management: although some aspects in the components of the indices in this
category of quality measure may be beyond the functions of a decentralized system (for
example, monetary policy is purely a central function), combining indices of the three
aspects of economic management provides a positive association with the degree of fiscal
decentralization. This in turn suggests that decentralized systems are more transparent in
defining the role of various public agents and place a greater premium on accountability for
results.
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Governance should be taken as a device for making governments more accountable to their
citizens. Governance can be seen in different forms or aspects. UNDP identifies the following
three forms of governance as:
 Political governance: the process of decision making to formulate policies,
 Economic governance: the process of decision making in the areas of management of
economic activities of a country, having major implications in handling the issues of
equality, poverty reduction, and quality of life,
 Administrative governance: which is the system of policy implementation,
Bearing these three categories of governance in mind, we need to define "good governance" that
denotes sound or democratic governance. It is defined as the "process and structure that guide
political and socio-economic relationships, an essential tool for both political progress and
economic development". Good governance promotes the rule of law and viable democracy.
Thus, the rule of law and democratic framework are essential components of good governance.
Good governance encompasses three major domains: state, private sector, and civil society
organizations. There is also a growing tendency to associate the concept of good governance
with the concept of NPA.
The concept of "good governance" has since 1989 become a popular political cliché (formula).
Governance became an incorporative element in the discourse of economic recovery in
developing countries. Good governance is viewed as quality political and institutional
management of economic policies.
Good governance has many attributes. It is participatory, transparent, accountable, effective and
equitable. It is effective in making the best use of resources, it is equitable, and it promotes the
rule of law. The key words included in the above definition, such as participation,
accountability, equity and rights, are linked with the existence of democratic institutions. The
concept of "democracy" is therefore strictly related with that of "good governance".
It emphasizes rationality, efficiency, procedure, and impersonal relations in political
management. Its key elements are bureaucratic efficiency, the rule of law, and accountability in
government transactions. Essentially, the concept has come to be associated with the object of
liberal democracy, with other features like participation, representation, and political fairness
added to its core principles.
Although good governance is an inclusive political concept, which may be used to describe the
totality of the management of the public sphere, it is a highly subjective concept. Because, the
notion of "good" and "bad" are normative values, which may be interpreted variously. For
example:
 As L. Roy (1998) noted good governance as conceived in the liberal paradigm denotes
the urge for developing countries to accept "a superior model of organization and
government" as practiced by developed liberal democracies of the west. It then assumes
the role of political ideology rather than a theoretical construct.
31
 Others argue differently as "good governance" in its theoretical conception should not be
associated with any form of rule or political régime, but should be viewed as the
consequence and effect, rather than the procedure and method of governance.
Given the apparent theoretical confusion, the concept of "good governance" entangled
(intertwined) in the term "accountable governance" seems more precise and definite.
4.1.2 Accountability and Transparency

According to Johnson (1992:23), accountability can be defined as ―the process by which public
officials answer to citizens directly or indirectly for the use of their powers‖. To ensure that
officials do not exercise their powers arbitrarily or for private gain, they must be answerable for
the outcomes of their actions, both negative and positive, to the citizens or its elected
representatives that they are supposed to serve.
Accountable governance suggests the answerability of a state system at all levels, (including the
government and other institutions of the state), to its constituency (to the people). Accountability
requires clarity about whom and on whose behalf an institution or organization is making and
implementing decisions, how it derives its power and legitimacy to do so.
This means, in effect, having clear procedures agreed by all members of the political community
about how decisions are to be made and ensuring transparency and adequate flow of information
in the decision process. In other words, accountable governance implies a process of
incorporating those for whom decisions are made. It is the process of social empowerment for
the people.
Adoption of Citizens' Charter that defines the relationship between public (government)
organizations and citizens who are the consumers of their services is the main tool for ensuring
accountability. In administrative context, accountability means adherence to relevant rules and
regulations of the game. It requires those in leadership to be in conformance (the very
embodiment of) to what society regards as ethical, fair or moral.
According to Dele Olowu (1993), accountability is the requirement that those who hold public
trust should account for the use of that trust to citizens or their representatives. Accountability
signifies the superiority of the public desire (choice) over private interests and tries to ensure
openness or transparency in every activity and conduct of public official.
Accountability is a prerequisite at all levels of governance. To be accountable means to be
obliged to render full and truthful reports to a superior level of authority concerning one's
activities and actions. In other words, accountability is the provision of genuine reports of actions
to the people by the state and its agents. Finally, for accountability to be effective there must be
an enforcing mechanism, it needs to have a watchdog organization responsible for carrying out
conformance and performance auditing.
As a whole, "good governance" is tantamount to mean "accountable governance" or "democratic
governance". In this understanding, in most African countries accountable governance is an
exception, rather than a norm. While political decentralization has taken place in many African
32
countries with creation of multiple tiers of government including local governments, there has
been little democratization of those decentralized structures.
4.1.3 Efficiency and Effectiveness

The terms efficiency and effectiveness are more of practical measures of performance or
productivity than abstract theoretical concepts. The literature on public service for example
defines measures of performance or productivity in various ways among which efficiency and
effectiveness are the most commonly used ones.
Since NPA suggests the application of achievement criteria to evaluate the performance of the
bureaucracy or public institutions, efficiency and effectiveness measures are highly
commendable.
A). Efficiency:
Without any contextual meaning, efficiency simply means the quality of doing something well
with no waste of time, money, and energy. It refers to the best use of inputs. In terms of
economic activity, it is extremely an important indicator characterizing the relation between the
economic results obtained and the cost or input applied.
It denotes the excellence of using available resources to achieve a more superior output. In other
words, efficiency is achieving superior result with the appliance of a given minimum input, or
economical utilization of inputs. Efficiency can be broadly defined as the margin of benefits
gained from a program or a certain activity over the resources invested in it (Johnson, 1992:480).
As a tool of measuring performance or productivity, it can be explained as the ratio between
outputs of activity and the inputs or resources. Efficiency compares the inputs or resources an
organization uses for the final goods or services it has produced. For service-giving organizations
specifically, efficiency refers to the ratio of the quantity of services provided (e.g. tones of refuse
collected) to the total cost required or spent to produce or effectuate the service.
However, efficiency measure doesn't determine the degree of satisfaction derived by clients
(service users) or the degree of the desired goal achieved. Hence, efficiency measure (outputs to
inputs ratio) has a limited application and value in the public service since it doesn't show the
level of satisfaction of the public. It is the operational type measure, not the impact indicative.
Therefore, the concern of efficiency is on the magnitude or amount of inputs employed to
achieve the intended result at a maximum possible level. In short, it means achieving
productivity or performance objectives at a given minimum cost or input, but misses other
objectives like the level of satisfaction from the output.
B). Effectiveness:
The term effectiveness is an administrative concern that generally refers to the degree to which a
program fulfills the goals defined by the policymakers, or extent to which the policies are
achieved the intended benefits (Johnson, 1992:480). Effectiveness is producing a successful
result that is wanted or intended. Unlike the efficiency or operational type measure, effectiveness
is a method for examining how well a government or any public service agency is meeting the
public purpose it is intended to fulfill. It measures the impact of a program or any activity on
33
society and determines whether that program or activity makes use of an optimum cost (inputs or
resources) to achieve its goals.
Effectiveness refers to the degree to which services are responsive to the needs and desires of the
community or the public. Effectiveness encompasses both the quantity and quality aspects of a
service or a product, but the major concern is on the impact or consequence of the output.
Generally, efficiency and effectiveness measures are not mutually exclusive, rather are
complementary measures. Simultaneous adoption of the two reinforces the quality of appraisal
(judgment) of achievement and values of an organization or agency. Hence, to evaluate the
performances and impacts of public service organizations, these two measures are recommended
to be used concurrently.
In this consideration, Nancy S. Hayward defines governmental productivity as the "efficiency
with which resources are consumed in the effective delivery of public services". This definition
implies not only quantity, but also quality or value. For example, public transit performance
depends not only on the number of people who use it, but also upon whether these people have
safe, comfortable rapid, convenient, timely and reliable journeys.
The principal differences between efficiency and effectiveness lie in measuring direct output
(efficiency) and its consequences (effectiveness). It is useful to contrast them as being "inward"
(efficiency) and "outward" (effectiveness) looking forms of measurement.
In measuring effectiveness a public service agency tries to determine the impact of its services
on community conditions (outward looking), and in measuring efficiency an agency tries to
determine its own operations whether it has produced a reasonable amount of services per certain
inputs (inward looking).
Effectiveness answers whether the "right thing was done", while efficiency shows whether it was
done 'the right way". For the sake of clarifying the two measurement concepts we can see the
following examples:
(i). In attempting to measure the performance (productivity) of a government owned hospital,
efficiency indicates how many people were treated per medical staff-hour, while
effectiveness tries to show how many patient cases of the treatment were successful as
compared to the total number of patients treated.
(ii). If a government training institution trains unemployed people to help them find employment,
the number of people trained per teacher is an efficiency measure, while the number of
those trained who find employment after training is an effectiveness measure.
4.1.4 Citizens' (Community) Participation

Participation in some form or the other has been included as an important element in
development strategies of countries in Sub-Saharan Africa. Participation has become an
essential ingredient and a prerequisite of good governance.
There are emerging concerns to promote the importance of participation in all aspects of
activities undertaken at different levels. These may include, among others:
34
1. There evidences of positive relationships between participation and

efficiency/effectiveness of a program and project
2. Irrespective of political philosophies, governmental function need to be
decentralized from national to local governments, and from local governments to
community organizations as government agencies alone cannot manage the rapidly
number of development programs and projects
3. Development planners are increasingly recognizing that they have a morale
obligation to "listen to people" both to understand their needs and to assess the
impacts of a particular program/project on their lives
4. Feminists, pro-poor activists and human rights champions become concerned much
about the inclusion of women, the minorities, and people with disabilities
According to Oakley et.al. (1991:6), although participation is still myth (fiction, invention) than
reality, "... it is now almost reactionary to propose a development strategy and an electoral
process which is not participatory".
Development as a process of increasing people‘s capacity to determine their future means, that
people need to be included (to participate) in the process. Participation is part of the process and
definition of development. There is, therefore, a consensus that people everywhere have a basic
human right to take part in decisions that affect their lives.
Participation is also linked to anti-poverty and social exclusion. This is because participation is
the pillar for efforts of self-help, eradicating poverty, encouraging the growth of domestic
institutions and thereby creating political space for disadvantaged groups who were originally
excluded from decision-making process.
Participation has been advocated as a way of solving ethnic problems in African states where
exclusion of social groups from participating in decision-making process and government
structures is evidently documented and regarded as the causes of the catastrophes and conflicts.
Consequently, participation is regarded as a process of consciousness raising, capacity
building, bridging social inequalities, and promoting gender balance as well as racial and ethnic
harmony. The call for participation has come from a broad spectrum of those concerned
with development, poverty alleviation and social inclusion and has been promoted by donor
agencies, NGOs, governments, civic organizations and other stakeholders.
For such reasons, participation has been defined in narrow and broad terms. In its narrow
contention and understanding, participation is defined as "the active engagement or
involvement of citizens with public institutions, such as in voting, election, and
campaigning including non-violent protests". A little modest, yet arguable, definition also
goes as “citizen participation simply refers to the formal roles played by persons who are
not elected or appointed government officials in advising or making binding decisions on
implementing public policies (Johnson, 1992:256).
35
Participation is also broadly defined as a “collective sustained activity for the purpose of
achieving common objectives, especially for a more equitable distribution of the benefits of
development (UNESCO, 1979:15).
"In the context of development, community participation refers to an active process by
which beneficiary or client groups influence the direction and execution of development
projects, rather than merely receiving a share of project benefits, with a view to enhancing
their well-being in terms of income, personal growth, self-reliance or other values they
cherish" Paul (1987). These further imply that participation should be seen as an evolutionary
and continuous process.
Political participation has been an issue in development management (administration) since its
inception and its significance increased principally as it becomes part of official rhetoric.
Participation can be exercised or observed both at individual and community levels, the later
being the sum of the former.
Individual participation rises up to popular participation where a large proportion of people are
invited and expected to express their wishes on issues of governance. In popular participation,
the majority should prevail over the minority, which is an imperative tenet for democratic
government.
The meaning and scope of participation has been changing from time to time. In the 1950s and
1960s, for instance, participation was feared as a disruptive influence and was very limited in
scope even in development programs. Participation in this period was defined in pure political
terms: it meant voting, party membership, activity in voluntary associations, protest movements,
etc.
With the emergence of the NPA movement in the 1970s,however, the meaning of participation
began to be redefined in terms of development in addition to political terms, and associated with
the administrative or implementation process. It further came to be the principal nexus of the
interaction between a government and citizens (Grindle; 1980:3). It is not uncommon to read in
the contemporary development dialogue that the success or failure of any political and
development effort depends on the extent of people‘s participation.
Evidences have been accumulated that development projects designed and implemented
without the full involvement of the intended beneficiaries have had a high rate of failure;
conversely projects planned with people‟s participation from the outset have had a
relatively high rate of success. Aid agencies have capitalized the NPA proposals and sought
to incorporate participatory approaches into their projects. Participatory systems up to
now have worked out best at community or project level, where there are bonds of
solidarity among the people.
Evidences show that the type of government (system of governance) largely affects
participation. Unfortunately, the experience with participation has not been encouraging in
Africa. Even where participation is recognized as a powerful means of good governance
and development, programs have failed to ensure genuine participation among people.
36
Development agencies often consider or take into account people‟s views through
consultation for their interventions, but consultation doesn‟t strictly mean participation.
Governments have extended their bureaucratic tentacles down to district and village levels. The
official agencies under the governments‘ structures still initiate and carryout most development
activities on behalf of the people. In such cases the people remained only being recipients of
development as if development is something outside their realm or area of experience (Ayee,
2000:47).
Oakley et al (1991: 14) mentioned possible obstacles that could hinder participation. These
include, inter alia, bureaucratic or administrative obstacles (centralized government structure),
structural obstacles (ideology, political and legal system), and socio-cultural obstacles (mentality
of dependency, culture, and tradition).
Political constraints still account the biggest share for the limits of participation in Sub-Saharan
Africa (SSA). Leaders still have paternalistic and neo-patrimonial tendencies to decide on all
matters over their people.
The bureaucracy is another major constraint to participation. It has always rigidly designed
operational rules and procedures, as well as structures and machineries that are inescapable under
any circumstances.
Participation has been equally hampered by socio-cultural constraints. The attitude of the people
themselves and the agencies about the significance of their participation is minimal. Both parties
assume or believe that participation is irrelevant to the circumstances of the poor.
Rather they prefer development interventions to be undertaken by outsiders who are supposed to
be knowledgeable and resourceful. Even within the assumed participatory process, the
implementation is evidenced by the imbalances of the social strata; gender, ethnic, age, and the
like factors are often forgotten.
Bamberger (1988:5) suggested that a complete definition of community participation should
focus on identifying the intensity of participation in terms of the number of people involved and
the duration or regularity of their participation as well as in terms of information sharing,
consultation, and decision-making. More specifically, a complete definition of participation must
take the following into account:
(a) The agents or organizational groups or the "instruments: these can include field
workers of the project agency, paid or voluntary community workers, groups created for
a specific purpose, or existing multipurpose organizations
(b) The medium or methods used: these can include formal leadership training programs,
learning by doing through the implementation of a project, consciousness raising, or the
use of animators or demonstrations
(c) The stages of projects in which beneficiaries are involved: these would mean
distinguishing the various stages of project phases where people/beneficiaries could
participate in decision-making, which may encompass need identification and
prioritization, project idea initiation, project planning, project feasibility test and
37
appraisal, project implementation, project management, project result/impact evaluation,

project benefit sharing
(d) The program's level or scope: a broad distinction can be made between micro-level
and macro-level programs/projects where people can be invited to participate
(e) The participants: who are the most targeted or intended potential or real participants
(women, youth, elderly, minorities, etc or the public at large)
(f) Intensity of participation: the intensity of participation can be classified in ascending
order as information sharing, consultation, decision-making, and initiative taking. It may
further include the number of people who participated and the duration of or regularity
of their involvement.
According to Vivian (1992: 53), true popular participation goes much beyond the mere provision
of labor and other inputs into projects initiated from outside the community; it further involves
decisions being taken and plans being formulated by citizens. In other words, as Wen (1976)
contemplated, participation implies not only people‘s involvement to contribute material, labor
and local knowledge to a given development effort, but also their position to gain an equitable
share from the fruits of development.
All these refer also to the existing varied perceptions of participation as a means and as an end.
Participation as a means entails using it to achieve some predetermined goals or objectives. In
other words, it is a way of harnessing the existing physical, economic and social resources in
order to achieve the objective of development programs and projects. In this case, participation
takes a passive form and becomes a short-term exercise.
On the other side, participation as an end is essentially a dynamic process which unfolds over
time and whose purpose is to develop and strengthen the capabilities of people to intervene more
directly in development initiatives.
The argument here is that participation increases efficiency, encourages people to make good use
of resources, and raises their motivation to improve their own condition. For the instrumentalists
that see participation only from the ―means‖ facet, the involvement of people is limited to
providing information and expressing felt needs and preferences and their role doesn‘t go beyond
consultation (Yeraswork, 1995:45-49).
To the radical model on the other hand, participation goes beyond the efficiency and success of
projects and programs. Here, ―participation is seen as a process by which the position of people
in terms of access to scarce resources and institutions of political power is significantly altered
and their present state of dependency is overcome‖ (Yeraswork, 1995:45).
For those who have a radical agenda, decision-making requires power so that participation
should imply organized action to bring structural changes and should be taken as a process of
empowering people.
There are varying arguments, however, on the potential benefits and costs of community
participation in the development process. Those who argue in favor of the participatory approach
often cite the following as advantages that could be reaped from the system:
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 More accurate and representative information about the needs, priorities, attitudes or
opinions and capabilities of people can be collected, more reliable feedback on the impact
of government initiatives and programs can be obtained,
 Participation increases efficiency, encourages people to make good use of resources, and
raises their motivation, enthusiasm; they feel that they are recognized as important
 Participation makes resource mobilization much easier, and the commitment of the people
more tangible
 Community involvement can generate new ideas, ensure social acceptability, build
constituency support, or increase the likelihood of beneficiaries commitment,
 Community participation may help to ensure more equitable distribution of benefits and
that politically or economically weak groups have equal access to resources and services,
All these advantages could be gained only when politicians, planners, and managers are made
aware of the benefits of participation and are anxious to use it.
Unfortunately, there is another line of argument made against the participatory approach. From
the point of view of officials, planners, and administrators, the participation of the public may
delay the process of planning and implementation. Because, in their view, the villager is lazy,
ignorant, unresourceful, irresponsible, and inexperienced while the professional is the expert and
knows everything. Because of this thinking, some government agencies use participation for
administrative ends without significant transfer of power.
There are also other points mentioned as disadvantages of participation such as:
 Project start up may be delayed by negotiations with beneficiaries (participants)
 Participatory projects are more risky than bureaucratically managed projects, because of
the problem to assign specific accountability (the tragedy of the commons)
 In politically volatile areas, participation may create conflicts and may lead to
unpredictable ends
Counter arguments suggest that local people are not ignorant, idle or apathetic, but are
resourceful, knowledgeable and hard working. From this standpoint, proponents of popular
participation emphasize that it would be wrong to assume arguments for greater people's
participation in development are based purely on idealistic, humanitarian, or egalitarian grounds.
Generally, whatever counterarguments have been made, participation today appears to be a
question of necessity. Participation is the order of the day throughout the world. Hence, done
with skill and commitment, participation can create change. This is what the paradigmatic
approach model of community participation tells us.
4.1.5 Empowerment
Participation and empowerment are very much-interrelated concepts, which sometimes are
understood as synonymous and used interchangeably. However, for people to take charge of
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their own destiny, something more than participation is required. To encompass that ―something
more‖, the NPA literature has included in its vocabulary the term ―empowerment‖, and the
development communities have widely adopted it. Empowerment has become something of a
catchword among pro-poor or neo-populist writers.
The concept of empowerment has been at the center of the re-conceptualization (paradigm shift)
of development and new administrative system. It has become a central concept concerned with
changing the pattern of controlling resources and political power, as well as the attainment of
self-reliant development and determination of own destinies by disadvantaged groups.
Wuyts (1992:132) noted that ―empowering the poor‖ has become an almost universal slogan. It
is stated as "a desired process by which the poor are to take direct control over the circumstances
of their own lives, so that they are in a position to become their own development agents in the
future". Chambers (1993:11) similarly indicated ―empowerment means that people are enabled
to take more control over their lives, and secure a better livelihood with ownership and control of
productive assets as one key element‖.
According to the Human Development Report (1997), "empowerment is the capacity to
challenge oppression, involving opportunities for decision-making and the capacity to shape the
choices individuals make for themselves. It is gaining greater access to, and control over,
resources, which need to be accompanied by the rise in self-confidence, consciousness, and
motivation".
Within the development discourse, the concept of empowerment evolved concurrently with the
"bottom- up" approach to development. This entails that the central purpose of empowerment
strategy is building power at the grassroots. In this respect, as Titi and Singh (1995:14) put it,
empowerment has been used to imply "the promotion of community development through self-
help; the process of enabling collective decision-making and collective action; transformation of
economies to self-reliant, endogenous, and human-centered development with good
governance".
The above prescriptions on empowerment affirm the need to build the capacity of communities
to respond to the changing environment, enabling people to understand the reality of their
environment and to improve their situation. Yeraswork (1995:52) saw empowerment as one
aspect or dimension of people‘s participation in the development process. Macpherson related
the idea of empowerment not only to getting access to resources but also with the notion of
increasing political power.
Empowerment at the generic level signifies strengthening the meaning and reality of the
principles of inclusiveness, transparency and accountability held in common with the
notions of democracy and sustainable development. Empowerment as a strategy for poverty
alleviation and sustainable development has to be a multifaceted and multidimensional process
involving the mobilization of resources and people's capacity.
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Due to this complex feature of the concept of empowerment, Titi and Singh (1995:15)
commented that attempts to define it in precise terms might not yield any significant insight into
the concept and its utility. Therefore, even supporters of the empowering strategy agree with the
difficulty of providing a precise definition to empowerment except describing its basic features,
elements, and goals.
Checkoway (1995:4) viewed empowerment as a multilevel process in which a person or
community gives or gets power from another. The notion here is that power originates from
outside. Empowerment literally means the granting or transfer of power usually from the
controlling authority to an individual or group for a specified purpose, which implies a ―zero-
sum transaction‖. However, this perception of empowerment has been seen wrong by other
commentators. For counter debaters of the grant aspect since those who hold power are often
reluctant or seldom ready to relinquish it, empowerment would mean the struggle of the
disadvantaged to achieve it rather than waiting for it to be granted from authorities (Hasan, 1991;
Sharp, 1996:46).
"Empowerment‖ in its full positive sense means, “enabling people to understand not only why
they are poor or disenfranchised, but also what they can do about it."
Others have discussed the concept of empowerment with little differences but with a common
denominator; i.e." enabling disadvantaged communities". Schuftan (1996:260) explained
empowerment as not an outcome of a single event, rather as a continuous process that
enables people to understand, upgrade and use their capacity to achieve better control over
resources.
Similarly, Barr (1995) argued that empowerment might be seen as the degree to which or
process by which disadvantaged communities define their own needs and determine their
life requirements.
Titi and Singh (1995:15) considered the following necessary conditions as crucial for
empowerment in order to understand its concrete manifestations.
 Local self-reliance and autonomy in the decision making process of communities;
 Space for cultural assertion and spiritual welfare;
 Experimental social learning including the articulation and application of indigenous local
knowledge;
 Access to resources and social services;
 Access to income, credit facilities, skill training, appropriate technology and information;
 Ability to achieve food self-sufficiency.
As a process, empowerment best includes, or rests on, three levels i.e., individual involvement,
organizational development, and community change (Checkoway, 1995:4). It is all about
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enabling poor people to achieve all life necessities. The general belief is that through
empowerment individuals, communities and nations could obtain collective responsibility for
their own future and become managers of their own development.
To realize the goals of empowerment, governments often endorse legal provisions, adopt
adjustment programs, and develop operational guidelines. Such governmental counteractive
actions are usually put-forth to serve as a panacea for past problems and weaknesses. They are
corrective in nature, targeting mainly disadvantaged and previously underserved social groups
with the aim of equalizing citizens in every dimension of life requirements.
One among such governmental initiatives and measures is the ―affirmative action‖ programs
widely adopted mainly in countries pursuing political, social and economic transformation.
Affirmative action is a projectized invitation for particular social groups by creating new
opportunities and privilege, which were less available or nonexistent in the past. Affirmative
action is also understood as a governmental or agency-level measure taken to compensate for
past discriminations. Affirmative action essentially begins with the understanding of two related
concepts: nondiscrimination and equal opportunity or access.
Affirmative action emphasizes the positive active steps needed to bring about change rather than
a passive attitude of simple nondiscrimination. Affirmative action can be defined as policies and
practices aimed at identifying and removing all barriers to equal accesses and opportunities and
to correct imbalances (Johnson, 1992:366). In terms of employment, for example, Affirmative
action can be defined as special efforts to invite persons or disadvantaged groups to apply for
employment and to hire them for positions for which they meet the basic qualifications.
Generally, affirmative action is one aspect of empowerment.
4.1.5 Privatization
According to Meier (1995), privatization can be defined as "the sale of government owned
corporations to private investors and the contracting out of formerly governmental
functions to private agents". Similarly, Hanke (1987) defined privatization as "…the transfer
of assets and service functions from the public to the private hands".
The transfer of public ownership to private ownership takes direct and indirect forms; i.e. direct
transfer refers to a complete transfer of public ownership (both assets and the management) to
the private sector, while the indirect one is privatization of the management aspect, most
appropriately known as "management contracting", the assets remaining under the ownership
of the public.
Management contracting is often made mainly with two objectives: to relieve administrative
burdens of the government, and to ensure administrative efficiency. In the developing countries,
transfer of ownership of public enterprises and government functions to private investors and
agents began in the mid-1980s.
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This has been made as a result of the widely adopted structural adjustment program in
response to the problem of the generally poor financial and economic performance of such public
enterprises as well as to that of inefficient public services.
The widely articulated rationales for the movement toward privatization have largely focused on
the perception of waste, lethargy (sluggishness), inefficiency, misappropriation, and poor quality
of products of public enterprises as compared to the privately owned ones. Public enterprises
also suffer from bureaucratic bottlenecks and rigidly applied procedures. Thus, privatization is a
sine qua non (an outcome) of such problems associated to public enterprises.
The point is that "is privatization the 'necessary condition' or 'sufficient condition' to break or
eliminate bureaucratic controls?" The answer is certainly that privatization is not a sufficient
condition to overwhelm (overcome) the archaic bureaucracy, rather is a necessary condition. It is
a means to an end, not an end by itself.
Therefore, in order to achieve the end objectives, privatization requires active encouragement
and strong support from the government. The support could be through formulating integrated
policy that address systematically the range of constraints inhibiting the operations privatized
enterprises.
As the NPA presumes or strives for administrative modernization, the role of government
changes from that of regulatory economic activity to that of creating conducive or enabling
environment for the private sector through providing legal, financial, institutional support and
infrastructure development that would all help to remove obstacles and constraints.
There are, however, important questions that need careful analysis and genuine answers; are
there contradictions between the ultimate goals of NPA on the one hand, and the implementation
of privatization as its feature on the other hand? There are counter arguments in this regard.
Among the frequently mentioned reasons that deny the positive relationship between "the
ultimate goals of NPA" and "privatization", the following seem sensible.
1. Public enterprises are established with mixed (commercial and non-commercial)
objectives. While the commercial objective is obviously about profit making, the
diverse non-commercial objectives may include income redistribution, subsidizing
particular regions or sectors, earning foreign exchange, generating employment,
correcting market failures and imperfections, as well as maintaining public
support (or increasing the probability that the party in power will be reelected).
From these lists of non-commercial objectives, we can single out the welfare and equity
motives like income redistribution, employment generation, and subsidization or
protection of the disadvantaged sections, market stabilization and inflationary control.
These will not be achieved once public enterprises are sold out and transferred into the
private hands, which in turn implies that we cannot talk about the "goals and
objectives of NPA" in the absence social welfare and equity.
2. Privatization in most developing countries has been implemented under forced
conditions, or under external pressures by international agencies as part of their
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structural adjustment and economic reform agenda. For this reason, governments of
developing countries are still reluctant to let privatized enterprises to operate with full
autonomy, to free them from any kind of control and suppression.
This entails that governments tend to privatize public enterprises unconvincingly and
without full commitment, simply to meet the preconditions imposed by donors.
Besides, indirect control of the government over privatized enterprises through
regulatory mechanisms and consequential mal-practices like corruption are apparent
cases in developing countries. All these are against the intents of NPA.
3. Since the underlying principles behind selling public enterprises are to ensure economic
efficiency, to increase productivity, and to relieve administrative burdens from the
government side, then the government will end up being growth-oriented rather than
development-oriented, irresponsible and unsympathetic to citizens' well being. Thus,
has no relevance to what NPA intends to be.
4.1.6 DECENTRALIZATION
Decentralization has been considered as a source of democracy, public participation, equity and
development in general. The common connotation or implication of the word is the transfer of
decision-making power to the local government units.
Decentralization is primarily a political commitment and process implemented to achieve
multifaceted objectives. It is a precondition for and concomitant of economic growth and social
modernization. Many commentators, (for example Tandon, 1990), agree on that although the
concept of decentralization has been dismissed as unrealistic, its contribution for administrative
and economic management is immense.
In a nutshell, decentralization can be viewed as "an ideological principle associated with
objectives of self-reliance, democratic decision-making, and popular participation in government
affairs, and accountability of public officials to citizens" (Sileshi Tefera (1993:5).
Hence, one way of defining decentralization, according to Cheema and Rondinelli (1983), is
that it is "the transfer of planning, decision-making, or administrative authority from the central
government to its field organizations, local administrative units, semi-autonomous local
governmental or non-governmental organizations".
Decentralization in the political administration context is "...the devolution of resources,
tasks and decision-making power to democratically elected lower-level authorities that are
largely independent of the central government".
Tegegn G/egziabher (1997:692) recapitulated more the various definitions of
decentralization provided by different authors as:
Decentralization ...(is)... the transfer of responsibility for planning,
management, and resource raising and allocation from the central
government and its agencies to (a) field units of the central government
ministries or agencies, (b) subordinate units or levels of governments, (c)
semi-autonomous public authorities or corporations, (d) area-wide regional
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or functional authorities, or (e) non-governmental private or voluntary

organizations.
While the transfer of responsibility is critical in the above definition, the agencies or authorities
to which power is transferred are several. In addition, decentralization has different dimensions
such as the type of activities over which power or authority is transferred; the level to which they
are transferred; the individuals or institutions to which they are transferred; and the type of
political, administrative and legal machinery used to make the transfer.
The various dimensions of decentralization are also expressed in terms of different modes of
decentralization; i.e. de-concentration, delegation, and devolution. Each of these forms of
decentralization has its own characteristics explained shortly as follows;
 In de-concentration, the central government shifts the workload to staff or offices outside
the national capital
 In delegation, some authorities and decision-making power is passed down to entities of
the lower administrative organs
 In devolution, local governments are given legally recognized boundaries in which they
enforce an independent authority to plan and implement programs
All these in turn indicate that there is no standard model of decentralization and every effort and
attempt to implement decentralization can be considered as a unique experience. Despite
difference in the nature and scope of decentralization experiences, any form of decentralized
development unanimously calls for the devolution of political, administrative and fiscal powers
so that regional governments perform their functions with no or minimum interference from the
center but working within the framework of the central government development policies and
strategies (Cheema and Rondinelli, 1986).
According to Cheema and Rondinelli (1983) the call for decentralization came as a result of the
failures of central governments to provide and maintain public services and infrastructure that
would satisfy the growing demands of the increasing population. Among the different arguments
in favor of decentralization, the following rationales and advantages are described:
 It is seen as a means of reaching the rural areas where governments do not have strong
control. In this regard, governments can create an effective channel of communication
with the lower level by establishing regional and local administrative jurisdictions.
 It can promote national unity by giving groups in different sections of the country the
ability to participate in planning and decision-making and hence increase their stake in
maintaining political stability
 It enables citizens to express their needs and demands and press claims for national and
local development resources
 It allows tailored plans addressing the local and regional problems and needs. It is a
means of improving planning and implementation of development activities in a more
flexible and innovative manner.
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 It ensures to achieve increased popular participation, make plans more relevant to local
needs, facilitate integrated planning, increases the speed and flexibility of decision-
making, generates additional resources and achieves equitable distribution as well as
more efficient use of resources
 Brings government and authorities nearer and answerable to citizens and increases the
availability and provision of public goods and services at the local levels.
 It relieves governments from involving in many local issues, technical and detail tasks
and thereby increases administrative effectiveness at all levels, and effectiveness of
economic activities and minimize wastages.
In view of the potential gains from implementing decentralization, it has become a popular
strategy and has attracted a great deal of attention in many developing countries. Recent
estimates show that out of 75 developing countries, 63 were actively pursing decentralization
policies that devolve functions and responsibilities from national to local level (Yigremew Adal,
2001:103).
Likewise in many other developing countries, decentralization has become the critical concern
for the prevailing government of Ethiopia. For this reason, Ethiopia has made a complete shift
from a centralized to decentralized system following the demise of the previous government.
Ethiopia has adopted a decentralization strategy by establishing regional and local governments
that has been effected through series of policy proclamations, which define and identify the legal
basis, powers, duties and responsibilities as well as resource basis of various government tiers in
the decentralized system. More importantly, decentralization in Ethiopia involves a high degree
of political devolution.
Yigremew (2001:105) pointed out determinants of decentralization in relation to the Ethiopian
ethnic federalism. These include political commitment, inter-organizational relations, availability
and access to resources, capacity of implementing agencies and the general environment.
Generally, it is argued that decentralization that goes down to the grassroots is more effective in
participation and local development. Decentralization increases popular participation, and helps
to formulate realistic and locally relevant plans, which will result in efficient implementation.
Decentralization increases flexibility and responsiveness in the management of development
projects, because decisions to correct mistakes or to adjust to changing circumstances can be
made at the local level (Wen, 1976; Sharp, 1996).
Some studies undertaken in different regions (for example, de Jong et al 1999; Meheret 1998)
illustrate that regardless of general legal provisions and political pronouncements towards
participative and democratic local governance local governments are not playing their role as
expected. Yigremew (2001:103) also mentioned a very pressing issue; i.e. the Ethiopian
government has not provided formal or clear decentralization policy.
As a result of this, he added, "it seems that local governance has not been given sufficient
attention, and many feel Ethiopian decentralization stops before it reaches the local levels... there
46
are also indications that those lower levels of government lack autonomy, representation and
sufficient resources". According to Yigremew, since the concept of decentralization is at odds
with a lack of decision-making power and resources at lower government levels, it is important
to examine the issue critically.
Chapter Five:
The Ethics of Public Service/Ethics in Public Sector
The public sector or the state is the government with all its ministries, departments, services,
central/provincial/local administrations, parasternal businesses and other institutions. The public
sector is composed of two core elements; at the political level there are the political institutions
where policies are formulated and the (major) decisions are made, and at the administrative level
there is the public sector administration, which is in charge of implementing these policies and
decisions. This implementing level is also called the civil service or state administration or
bureaucracy.
Ethics‘ is the core element in public service. Public ethics are a prerequisite to, and underpin
public trust and are a keystone of good governance (OECD, 2000). Public service involves
public trust. Citizens expect public servants to serve the public interest with fairness and to
manage public resources properly on their duties. Fair and reliable public services inspire public
trust and create a favorable environment for businesses, thus contributing to well-functioning
markets and economic growth.
Hence, serving the public requires a standard of ethicality. Ethics is a set of moral principles that
define right or wrong for a person or groups. Ethics is the study of what is morally wrong or
right. Gotterfried (2007) describes ethics as a body of principles or standards of human conduct
that govern the behavior of individuals and groups in doing the right thing in a given
circumstance behaving ethically. Pollitt (2003) defined ethics as rules of conduct and behavior,
which relate to questions of right or wrong, good or evil. Hornby (2000) defined ethics as a
system of moral principles that govern or influence behaviors of a person. Thus, ethics (morality)
is very important that laws without morality cannot endure, and no legal provision can be
implemented without moral consciousness based on ethical standards. In the words of Ferrel and
colleagues, ―whether a specific required behavior is right or wrong, ethical or unethical, is often
determined by stakeholders, such as investors, customers, interest groups, employees, the legal
system, and the community‖ (Ferrell et al., 2000, p.6).
A synthesis of the definitions given will view ethics as moral codes of behavior that are
established by a society, organization, individual, group or a country to protect their values.
Obviously, all ethical values and standards are culture-bound, but there are core values and
standards that are universal like impartiality, legality and integrity (OECD, 2000). Furthermore,
ethics, or more precisely professional ethics, has been defined as a system of shared values and
47
norms that delineate how public servants -as agents of the state and as members of an established
profession should exercise judgment and discretion in carrying out their official duties.
High ethical standards are not simply an end in themselves. There are significant benefits to be
gained from raising the ethical tone of an organization. Zipparo (1998) established that sound
ethical practices contribute not only to an organization‘s integrity, but also to its operational
effectiveness. Zipparo demonstrated that the ethical tone of an organization can affect efficiency
and effectiveness, decision making processes, staff commitment and job satisfaction, staff stress
and Staff turnover.
Thus, those organizations optimizing their ethical performance will not only protect the public
interest and improve their resistance to corruption, but are also likely to enhance their reputation,
competitiveness, ability to attract and retain quality staff, the career prospects of their staff, their
ability to meet new challenges, their ability to serve the community well.
Thus, public services determine public trust on government based on their performances-how
ethically they provide services to the public. Thus, Public service rules by themselves will not
lead to good governance unless they are backed by ‗political will‘ and the preparedness of
government to impose total adherence to these rules to promote public good. Therefore, the
political will and commitment of the government is tested by a total adherence of the civil
service rules to promote public good in the public sector (UNDP, 2007). The moral-ethical
culture, which prevails in the public sector, is dependent on the values of society. A society,
which does not, or is not allowed to express moral protest in public, can cause political office-
bearers to have a low sense of responsibility and integrity.
Administrative ethics: Administrative ethics refers to the ethics or morality in public service
organizations, distinct from ethics in the political and business spheres.
Features of an ethical bureau include freedom from corruption (using official resources or power
for private purposes), natural justice (all supplicants receive a fair, unbiased hearing), availability
of employment to all citizens (not just an elite class) on merit, good work value given for salaries
paid, and avoidance of waste.
Public service ethics/administrative ethics are broad norms that stipulate how public servants
should behave and exercise judgment and discretion in carrying out their official duties (Tunde
and Omobolaji, 2009). Ethics is synonymous with morality as it is a system of moral principles
governing or influencing a person‘s behavior (Ezeani, 2006). Ethics may be defined as
―standards of civility, duty and professionalism that cause decisions to be made and actions to be
taken that are in the best individual, organizational and public interest‖ (Fisher‘s Law, 1992).
According to Colin Hicks, ethics has different meanings depending on personal status.
In layman‘s terms, ‗ethics‘ is about how we ought to behave, or doing the right thing. For public
officials that means how to behave in a particular role, and how to live up to the expectations of
others-colleagues, employers, politicians, citizens, users of public services, and so forth. To
discern what constitutes an ethical decision or action requires a degree of reasoning to make
choices not just between right and wrong, or good or bad, or just and unjust, but between right
48
and most right, or ethical and most ethical. The exercise of discretion in these matters cannot be
determined just by reference to a code of conduct or accompanying guidance material, as
important as those minimum standards may be in the scheme of things. The reasoning processes
and instincts are informed by experience and knowledge acquired through the practice of public
management and the internalization of fundamental public sector values applying to all agencies
of the state (Hicks, 2007:11)
The failure or relegation of every ethical standard or questions of morality will inevitably
produce corruption and corrupt practices in public organizations thus hindering sustainable
development and quality of service delivered to the public and private sectors. The effects of
ethical erosion and criminal practices in the public sector is unsupportable in the development of
countries, resulting in a loss of confidence in public institutions and an erosion of the rule of law
itself(UNDP (2001:9).
According to Hewlett Packard (2007:5):
Ethics and compliance is a fundamental part of a performance culture in a successful
organization. Ethical leadership is about each individual‘s decisions and actions with others.
Here, ethics and compliance to the rules and ethical standards are important elements for the
success of public sector. Besides, ethical leadership is important to solve ethical dilemmas and
conflict of interests encountered on carrying their regular duties. More or less, despite the
differences in authority and positions, public servants have their discretionary powers vested on
them to exercise.
Ethics must be seen as an ongoing activity and not as a status to be attained. Ethics is not just
about establishing a set of rules or code of conduct but is an ongoing management process that
underpins the work of government (Hondeghem, 1998). According to Denhardt (in Hondeghem,
1998), ethics are not a set of rules or values waiting to be discovered, that provides all the
answers. In the complex world of public administration, norms and values rarely provide clear-
cut answers to difficult problems.
Generally, public organizations are challenged to find ways to institutionalize ethical values, and
hold public servants accountable for behaving in accordance with the standards. Public servants
exercise discretionary powers in their everyday duties in several ways; in their stewardship of
public resources, at the interface with citizens, and in the context of their policy-making
functions. Ethics is one of the important checks and balances or remedies against the arbitrary
use of that public power. Ethics can be learned. Knowledge of ethics can help civil servants to
resolve conflicts and observers of government to recognize and applaud ethical behavior when
they see it.
Who is responsible for holding officials to account for meeting ethical standards? Every citizen.
This includes customers who use government services, media who demonstrate that they know
the difference between ethical and unethical behavior, and electors who do no more than vote
every few years
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Serving the public interest is the fundamental mission of government and public institutions.
Citizens expect individual public officials to perform their duties with integrity, in a fair and
unbiased way (OECD, 2004). Governments are increasingly expected to ensure that public
officials do not allow their private interests and affiliations to compromise official decision-
making and public management. In an increasingly demanding society, inadequately managed
‗conflicts of interest‘ on the part of public officials have the potential to weaken citizens' trust in
public institutions.
Public services are the activities of public servants and institutions aimed at formulating and
implementing governmental policies, strategies and programs for the interest of the public
(UNDP, 2007; CSRP, 1994). Public service means serving the public interest up to the level of
its expectations. Public service or civil service is responsible for the management of the
machinery of government and carrying out the day-to-day duties that public administration
demand. The public require from the public sectors efficient, effective and quality services with
transparent, accountable, legal and fair working procedures (OECD, 2007; WB, 1997).Thus,
more than ever, citizens are calling for public sector (state institutions) that are democratic,
efficient in the use of public funds, effective in delivering public goods while in the meantime
remain strong players in the increasingly competitive global system (UNDP, 2007).
Any public organization has a public duty to optimize the value of its services to the public.
However, corruption and other unethical behavior compromise the value of those services. Apart
from affecting the cost, quality and availability of services, unethical behavior can lead to a loss
of public trust. Loss of public trust can further undermine the ability of public sector agencies to
provide effective and equitable services, especially to those most in need.
Therefore, the importance of ethics is acknowledged by the explicit requirement that state public
sector leaders behave ethically and maintain high ethical standards in their organizations. There
is strong need for Civil service institutions to follow an appropriate and improved system of
service delivery so as to give service to the public in an effective, efficient, transparent and
impartial manner; the employees of the civil service institutions have the responsibility and
obligation to provide quality service to the public fairly, equitably, honestly, efficiently and
effectively.
Why Public Sector Ethics?
The ―others‖ that are the carriers of the duties and obligations to provide us with our legal and
moral rights, freedoms and welfare are usually understood as the state or the public sector. The
state is not only in the ethical theory of positive and conventional rights the foremost provider of
rights and welfare, but the state is also the main provider of rights as understood by most people
and in most circumstances. In other words, negative duties are an obligation for everybody,
whereas positive obligations are the duty of some particular group or institution, usually the
state.
Public sector activities range from delivering social security, administering urban planning and
organising national defence to the provision of health, schools and roads. In principle, there is no
50
limit to what the state can do. There is, however, much debate on how much the state should
intervene, like in the economic sectors and in the private life of their citizens. This is a political
question, and the debate about the role and the size of the state and the public sector (as opposed
to the private sector) is probably the single most important dividing line in political philosophy,
with the socialists preferring greater state involvement, libertarians favoring only minimal state
involvement (security and property protection), whereas conservatives and liberals are favoring
state involvement in some aspects of the society but not others.
Ethics is rarely a matter of concern in the ideology debate on the role of the state, but ethics is a
natural concern in the discussion on the actual role of the politicians and the state administration.
No matter how big and what role the state is playing (and supposed to be playing), both
politicians and civil servants have discretionary powers; they make decisions that affects a lot of
people. Therefore, these decisions ought to be based on some form of ethics. For instance, the
public (a nation‘s citizens) will normally expect the country‘s politicians and public servants to
serve in the public interest, and to serve in a rational and efficient way. They will not want them
to pursue narrow private, personal, or group interests.
Professional, public-sector ethics of civil servants and politicians are somewhat different from
the personal ethics of individuals. In addition to the personal ethical values and principles of
individuals (like respect for others, honesty, equality, fairness, etc.), the professional public
servant faces another context and an additional set of values and principles. Although the public
sector is a labyrinth of agencies with different tasks, reporting lines, levels of responsibility and
ethical cultures, we are looking for these ―universal‖ or basic principles of public service.
There are also some differences between public sector ethics and private sector (business) ethics.
The aim of the private corporation or business is, in general, to make money, whereas the public
sector is meant to perform functions for the society as a whole, according to general and political
priorities. For instance, a private company can choose to donate some of its profits to charity, but
a public agency may be prohibited from such largesse with public funds (without a specific
mandate to do so). The context is different, and the principles of operation between the public
and business sectors differ.
According to Kinchin (2007), the ethics of public service is (should be) based on five basic
virtues; fairness, transparency, responsibility, efficiency and no conflict of interest. There are,
however, other principles in operation, and public servants face several dilemmas, for instance
when the bureaucrats‘ private ethics collide with his professional public work ethics or
organizational cultures
Codes of Ethics as Ethics Guidance in the Public Sector
Codes of ethics generally refer to rules and regulations designed to achieve a type of public
servant who is vigilant, upright, honest and just (Hope, 2000). The basic aim of the Code of
Ethics is to facilitate efficient, effective and courteous delivery. According to Driscoll et al
(2000:77), code of ethics serves as a central guide to support day-to-day decision making at
work, and clarifies the cornerstones of the organization-its mission, values and principles,
helping the public servants understand how these cornerstones translate into everyday decisions,
51
behaviors and actions. An organization‘s code of ethics is a written expression of its ethical
norms and values (Schwartz, 2001; Valentine and Barnett, 2002).
Ideally, an ethics code demonstrates the organization‘s interest in the business ethics and
communicates core beliefs to employees (Shore, 2000). Formal code of ethics may lead to more
positive awareness of the ethical values of the organization and may also contribute to higher
levels of ethical conduct among employees(Valentine and Barnett, 2002).To the extent that
ethics codes cause employees to believe that the organization‘s norms and values are congruent
with their own, they may also lead to higher levels of organizational
commitment(Finegan,2000;Schwpker,2001).However, some studies have found that the
existence of ethics codes makes little, if any, difference in any employees‘ attitudes and
behavior (Cleek and Leonard,1998).One explanation for these inconsistent result is that, even
when an organization has a code of ethics ,personnel might not be aware of its existence or
acquainted with its composition(Loe,2001).
Organizational ethical values form a key part of a company‘s overall culture, affecting many
important activities and relationships, such as competitive strategies, personnel policies, and
relationships with different stakeholder groups. Therefore, organizational values are commonly
defined as the standards that guide the external adaptation and internal integration of
organizations (Hunt, Word, Chonko, 1989: 79). Ethical values concern what is right and wrong
and allow the organization to set normative standards for employees. Organizational ethics and
values have roles on the behaviors of the employees as shown in the figure below of services to
the public.
There is a sharp ongoing debate as whether codes of ethic should be explicitly written or remain
as general understandings of what constitutes as ethical behavior (Olowu, 2000). For African
countries, the benefits from codification outweigh the costs related to policing and enforcing
them for the following reasons: There are yet no settled values of public service-instead there are
competing claims for loyalties based on primordial or other allegiances rather than public
interest. Codes provide a certainty of standards of ethical behavior expected of civil servants.
They aid help civil servants courteously to decline unethical requests and commands from
superiors, colleagues, and friends. They enable senior managers and political leaders to hold their
subordinates accountable and vice versa. They provide a clear basis for conducting training civil
servants in ethics and for educating the public on the rights and duties of civil servants (Olowu,
2000).
Most modern Civil Service Ethics laws and Codes of Ethics for Public service employees and
officials endorse the following minimum set of principles in their codes: serving the public
interest, transparency, integrity, legitimacy, fairness, responsiveness, efficiency and
effectiveness.
Further, the ―Seven Principles of Public Life‖ by the Nolan Committee in the United Kingdom
are set out for the benefit of all who serve the public, provide a valuable framework for
evaluating recent experience and for considering the future. These are selflessness, integrity,
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objectivity, accountability, openness, honesty, leadership (The Nolan Committee‘s Principles of

Public Life (Chapman, 2000:230–231).
The Institute of global Ethics (2001) outlined the following ethical values, which transcend
virtually all cultures and religions. These are love and Caring, truth, freedom and liberty,
fairness, justice and equity, unity, responsibility and accountability, respect for life, integrity.
According to Organization for Economic Cooperation and Development (OECD, 2009), the
most frequently stated public service values were Impartiality, Legality, Integrity, Transparency,
Efficiency, Equality, Responsibility and Justice.
The Ethiopian Principles of Public Service
The public service as a profession promotes the value of probity, neutrality, and fairness, among
many others. The Federal Civil servants‘ Proclamation number 515/2007 embraces the merit
principle in setting up career structures from recruitment to promotion like U.S American civil
service merit principles . These include recruit, select , and advance on merit after fair and open
competition ; treat employees and applicants fairly and equitably ; provide equal pay for equal
work and reward excellent performance ; maintain high standards of integrity , conduct ,and
concern for the public interest, manage employees efficiently and effectively ; retain or separate
employees on the basis of their performances ; educate and train employees if it results in better
organizational or individual performance ; protect employees from improper political influence ;
and protect employees against reprisal for the lawful disclosure of information ; ―whistleblower‖
situations .
Professionalism in the civil service /public service is an over arching value that determines how
its activities will be carried out. It encompasses all other values that guide the public service such
as loyalty, neutrality transparency, diligence, punctuality, effectiveness, impartiality and other
values that may be specific to individual Countries (United Nations, 2000:3).
The core ethical values that should guide the work of public servants in Ethiopian public service
include integrity, loyalty, transparency, confidentiality, honesty, accountability, serving the
public interest, exercising legitimate authority, impartiality, respecting the law, responsiveness
and leadership (FEACC, 2013).
Integrity: A public servant must exhibit the highest standards of professional competence and
private conduct. It is using independent judgment avoiding conflict of interest and resisting
economic pressure. It means being faithful to one‘s deepest beliefs, acting on one‘s conviction
and having principles.
Loyalty: A public servant must have dedication to upholding the constitution and the laws and
trusted to discharge their duties by fellow civil servants and public officials. Loyalty does not
mean blind unquestionable obedience.
Transparency: A civil servant must be open as possible about decisions, taking care of justify
actions. Any information should be kept confidential if it is vital for public‘s use.
Confidentiality: a civil servant should not disclose information that has to be confidential or
private nature. It includes adequate storage and holding of information and records in any form
53
to ensure confidentiality including taking reasonable safeguards to make data anonymous when
appropriate and restricting access to reports and records to those who have a legitimate to know.
Honesty: Honest civil servants and public officials should serve as pillars to build public‘s trust
and respect for the government. Being truthful, not to deceive or deceit others. Civil servants and
public officials should respect their vow and refrain from deceit, fraud, and corruption.
Accountability: A civil servant must be responsible for the decisions. This means accepting the
consequences of one‘s decisions and their consequences. Civil servants and public officials
should also be cooperative for the proper inquiry that might be executed by their respective
institutions.
Serving the Public Interest: The activities and the decisions made by civil servants and public
officials should be directed towards maintaining public‘s interest. Public employment being a
public trust, the improper use of a public service position for private is regarded as a serious
breach of duty.
Exercising Legitimate Authority: Civil servants and public officials are required to administer
the laws, and exercise administrative power on behalf of the people. Power and authority should
be exercised legitimately, impartially and without fear or favor, for its proper public purpose as
determined by the parliament or their employer.
Impartiality: Civil servants and public officials should make decisions and act in a fair and
equitable manner, without bias or prejudice, taking in to account only the merits of the matter,
and respecting the rights of affected citizens.
Respecting the Law: civil servants and public officials obey the law and comply with enactment
proclamations or directives appropriate for duties. They are required to administer the laws, and
to exercise administrative power on behalf of the government or other authority. That power and
authority should be exercised legitimately, impartially and without fear or favor, for the proper
public purpose.
Responsiveness: Civil servants and public officials must listen and respond to the needs of
stakeholders timely and with respect and courtesy. It also includes taking action in accordance to
social values. A responsible person shall act in a way that his or her act will produce, in long run,
maximum good to society. Public institutions must improve and expand their services and
programs by taking into consideration suggestions forwarded by the public.
Leadership: Civil servants and public officials should be forefront to promote and support these
principles by taking the lead and setting examples including helping employees understand how
they contribute to achieve common objectives and develop a sense of accountability, ownership
and responsibility in fellow employees.
Managing ethics: an OECD Recommendation
The Public Management Committee (PUMA) of the OECD (Organization for Economic
Cooperation and Development) developed a set of principles for managing ethics in the public
service. They were discussed at a symposium held in November 1997. After a thorough review,
the Committee presented them to the Council of the OECD, which adopted them as a
recommendation. OECD ministers later welcomed the recommendation and asked the PUMA
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Committee to report in 2000 on the way countries were using these principles as a tool to be
adapted to national conditions, and to find their own ways of arriving at an effective framework
that suits their own circumstances. The principles are, of course, not sufficient in themselves, but
are a means of integrating ethics management within the broader public management
environment.
The OECD Recommendation asks countries to take action to ensure well-functioning institutions
and systems for promoting ethical conduct. This can be achieved, it says, by regularly reviewing
procedures and practices influencing ethical conduct. The recommendation invites countries to
use the following principles in the review process. This exercise will help to locate the strengths
and weaknesses of the ethics infrastructure and enable governments to improve their ethics
management systems.
Principles for Managing Ethics as recommended by OECD
 Ethical standards for public service should be clear
Public servants need to know the basic principles and standards they are expected to apply to
their work and where the boundaries of acceptable behavior lie. A concise, well-publicized
statement, such as a code of conduct, of core ethical standards and principles that guide public
service, for example, in the form of a code of conduct, can accomplish this by creating a shared
understanding across government and within the broader community.
 Ethical standards should be reflected in the legal framework
The legal framework is the basis for communicating the minimum obligatory standards and
principles of behavior are for every public servant. Laws and regulations could state the
fundamental values of public service and should provide the framework for guidance,
investigation, disciplinary action and prosecution.
 Ethical guidance should be available to public servants
Professional socialization should contribute to the development of the necessary judgments and
skills to enable public servants to apply ethical principles in concrete circumstances. Training
facilitates ethics awareness and can develop essential skills for ethical analysis and moral
reasoning. Impartial advance can help create an environment in which public servants are more
willing to confront and resolve ethical tensions and problems. Guidance and internal consultation
mechanisms should be made available to help public servants apply basic ethical standards in the
workplace.
 Public servants should know their rights and obligations when exposing wrongdoing
Public servants need to know what their rights and obligations are in terms of exposing actual or
suspected wrongdoing within the public service. These should include clear rules and procedures
for officials to follow, and a formal chain of responsibility. Public servants also need to know
what protection will be available to them in cases of exposing wrongdoing.
 Political commitment to ethics should reinforce the ethical conduct of public servants
Political leaders are responsible for maintaining a high standard of propriety in the discharge of
their official duties. Their commitment is demonstrated by example and by taking action that is
55
only available at the political level; for instance, by creating legislative and institutional
arrangements that reinforce ethical behavior and create sanctions against wrongdoing; by
providing adequate support and resources for ethics-related activities throughout government;
and by avoiding the exploitation of ethics rules and laws for political purposes.
 The decision-making process should be transparent and open to scrutiny
The public has a right to know how public institutions apply the power and resources entrusted to
them. Public scrutiny should be facilitated by transparent and democratic processes, oversight by
the legislature, and access to public information. Transparency should be further enhanced by
measures such as disclosure systems and recognition of the role of an active and independent
media.
 There should be clear guidelines for interaction between the public and private
sectors
Clear rules defining ethical standards should guide the behavior of public servants in dealing
with the private sector; for example, regarding public procurement, outsourcing or public
employment conditions. Increasing interaction between the public and private sectors demands
that more attention should be placed on public service values and requiring external partners to
respect those same values.
 Public service conditions and management of human resources should promote
ethical conduct
Public service employment conditions, such as career prospects, personal development, adequate
remuneration and human resource management policies should create an environment conducive
to ethical behavior. Using basic principles, such as merit, consistently in the daily process of
recruitment and promotion helps operationalize integrity in public service.
 Adequate accountability mechanisms should be in place within the public service
Public servants should be accountable for their actions to their superiors and, more broadly, to
the public. Accountability should focus both on compliance with rules and ethical principles, and
on achievement of results. Accountability mechanisms can be internal to an agency as well as
government-wide, or can be provided by civil society. Mechanisms promoting accountability can
be designed to provide adequate controls, while allowing for appropriately flexible management.
 Appropriate procedures and sanctions should exist to deal with misconduct
Mechanisms for the detection and independent investigation of wrongdoing such as corruption
are a necessary part of an ethics infrastructure. It is necessary to have reliable procedures and
resources for monitoring, reporting and investigating breaches of public service rules, as well as
commensurate administrative or disciplinary sanctions to discourage misconduct. Managers
should exercise appropriate judgments in using these mechanisms when actions need to be taken.
 Managers should demonstrate and promote ethical conduct.
 Management policies, procedures and practices should promote ethical conduct.
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COURSE 13: HUMAN RIGHTS AND HUMANITARIAN
Chapter One
Conceptual and Theoretical Understanding of Human Rights
MEANING AND DEFINITION OF HUMAN RIGHTS

Human rights are rights to which all human beings are entitled because of their humanity and not
because of their social status or individual merit. Some of these rights are claimed and enjoyed
without regard to political order. The types of human rights, which are closely related with the
actions of governments, are Civil liberties and Civil rights. Civil liberties are constitutional
protections of persons, opinions and property against arbitrary interference by government. They
include such protections as freedom of speech, freedom of press, freedom of religious belief and
freedom from arbitrary arrest and punishment. Civil rights are legally guaranteed benefits
provided by positive actions of government. They include such guarantees as education,
protection against illness and starvation and financial support in unemployment and old age.
It is believed that human rights are necessary precondition for other values. It is widely held
view that Human rights must exist because they are a necessary precondition for self-respect,
respect for others, and personal dignity. Similarly, many human rights documents state that rights
derive from the inherent dignity of the human person.
THEORIES OF HUMAN RIGHTS

The notion of human rights has played a large role in western history and now in international
relations since1945. The international community – mostly through the United Nations – has
agreed on a modern version of human rights. The revival of human rights by the UN, its practice
of human right declarations, promotion, standard setting and institutional building aimed at
addressing human wrongs such as racism, colonialism oppression etc. Numerous attempts have
been made to justify human rights in terms of other sources of normatively, or values that can be
used to justify these rights. Though there is widespread acceptance of the principles of Human
Rights, there is no complete agreement on the nature of these rights and their substantive scope.
The Collapse of natural right which was based natural law theory which argued rights are
guaranteed by the will of God led to the emergence of Human rights discourse.
The emergence of human rights discourse is associated with the growing threats against human
survival. Humans need human rights principally when they are not effectively guaranteed by
national law and practice. Human rights are the language of victims and the dispossessed.
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Human rights claims are used principally to seek to alter legal or political practices. Attempts
have made concerning the importance, essence and source of human rights.
Some argues that human nature is source of human rights. The human nature that is the sources
of human rights rests on the moral account of human possibility. Human rights rest on an
account of life of dignity to which human beings are suited by nature. The argument is that if
rights specified by the underlying theory of human nature are implemented and enforced ,they
should help to bring the envisioned type of person, one who is worthy of such a life. The
effective implementation of human rights thus resembles a self-fulfilling moral prophecy.
Some attempt to ground human rights in science, usually relate them with basic needs.
Anthropologists seek to ground human rights on cross cultural consensus. Culture of societies
sanctioned (protect) wrong doings against Human rights. Unfortunately no theory of human
nature has a wide spread acceptance. In relation to these there is no consensus on the theoretical
justification of human rights. Politicians, states and people do not necessarily use any explicit
philosophical theory to support their views, or to explain why they believe in certain laws or
basic rights, but they inevitably have some type of theory.
SUBSTANTIVE CATEGORIES OF HUMAN RIGHTS

CIVIL, POLITICAL, ECONOMIC, SOCIAL AND CULTURAL RIGHTS
Civil rights
Civil and political rights which is seen as a child of the elightenment and the American and
french revolution, Constitutes the core of human rights. These rights are individual rights. Civil
rights are often used with reference to the rights set out in the first eighteen articles of the
UDHR, almost all of which are also set out as binding treaty norms in the ICCPR. From this
group, a further set of ‗physical integrity rights‘ has been identified, which concern the right to
life, liberty and security of the person, and which offer protection from physical violence against
the person, torture and inhuman treatment, arbitrary arrest, detention, exile, slavery and
servitude, interference with one‘s privacy and right of ownership, restriction of one‘s freedom of
movement, and the freedom of thought, conscience and religion.
The difference between ‗basic rights‘ and ‗physical integrity rights‘ lies in the fact that the
former include economic and social rights, but do not include rights such as protection of privacy
and ownership. Although not strictly an integrity right, the right to equal treatment and protection
in law certainly qualifies as a civil right. Moreover, this right plays an essential role in the
realisation of economic, social and cultural rights. Another group of civil rights is referred to
under the collective term ‗due process rights‘. These pertain, among other things, to the right to a
public hearing by an independent and impartial tribunal, the ‗presumption of innocence‘, the ne
bis in idem principle and legal assistance (see, e.g., Articles 9, 10, 14 and 15 of the ICCPR).
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Political rights
In general, political rights are those set out in Articles 19 to 21 of the UDHR and also codified in
the ICCPR. They include freedom of expression, freedom of association and assembly, the right
to take part in the government of one‘s country, and the right to vote and stand for election at
genuine periodic elections held by secret ballot (see Articles 18, 19, 21, 22 and 25 of the
ICCPR).
Economic and Cultural Rights

The economic and social rights are listed in Articles 22 to 26 of the UDHR, and further
developed and set out as binding treaty norms in the ICESCR. These rights provide the
conditions necessary for prosperity and wellbeing. Economic rights refer, for example, to the
right to property, the right to work, which one freely chooses or accepts, the right to a fair wage,
a reasonable limitation of working hours, and trade union rights. Social rights are those rights
necessary for an adequate standard of living, including rights to health, shelter, food, social care,
and the right to education ( Articles 6 to 14 of the ICESCR).
Cultural rights
The UDHR lists cultural rights in Articles 22-27. These include the right to participate freely in
the cultural life of the community, to share in scientific advancement, and the right to the
protection of the moral and material interests resulting from any scientific, literary or artistic
production of which one is the author (see also Article 15 of the ICESCR and Article 27 of the
ICCPR)
The Historical and Philosophical Foundations of Human Rights
Historical Foundation
Gradually the essence of natural right has changed in the twentieth century and human rights
have become the more widely used term by replacing the phrase 'natural rights', which was
intimately linked with natural law. As natural rights totally bagged with the rights of man that
excludes the rights of women. Though, the concept human rights are modern arrival and are now
used as everyday language, experts still dispute what exactly a human right is. Nevertheless,
rights are now associated with concepts of humanity that are more complex and sometimes
ambiguous and derive from our contemporary understanding of what it means to be a human
being.
Despite the fact that human rights have got worldwide acceptance as necessary conditions for
self-realization, there is controversy regarding the history of human rights. Some viewed that the
concept of human rights had little history before the establishment of United Nations in 1945. It
appears in the United Nations Charter for the first time. If any, they were not all inclusive; rather
they were exclusive because Africans, Latin Americans and Asians were subjected to Slavery
and Colonialism. However the common view is that the contemporary conception of human
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rights has a much better long history. With respect to the second position the following periods
are taken as Evidences
Ancient Period
The history of the idea of human rights can be traced back to ancient Greece and Rome. It was
closely tied to the pre-modem natural law doctrines of like Stoicism (a philosophy that advocates
human conduct should be judged according to and brought into harmony with the law of nature).
Likewise, Roman law similarly allowed the existence of natural law and law of nations.
According to Romans, natural law, not the state, that assured Roman citizenship. Generally the
following are milestones in the historical evolution of human rights.
Middle Ages
During the middle ages, natural law doctrines were related to various political theories of natural
rights. Natural law mainly teaches the 'duties of man' as distinct from the rights of 'man'. The
focus on duties than rights resulted in the legality (legitimizing) of slavery and serfdom, which
excludes the important part of human rights (the idea of liberty and equality).
The 1215 Magna Carta (the Great Charter): it represented an agreement between the king (King
John of England) and the baronage. It mainly protected the rights and privileges of the feudal
lords. In the meantime, Magna Carta guaranteed some rights and liberties to the English people.
Opposed taxation without representation, forbade unlawful arrest, and called for trial by jury.
The 1628 Petition of Rights: the English parliament adopted petition of rights in 1628. Some of
the contents of the document were: the king may not levy taxes; the king may not imprison any
person without charges or law.
The 1688 "Glorious Revolution": the revolution culminated and brought about the signing of
the 1689English Bill of Rights. The bills of rights prohibited the king from suspending laws, levy
taxes, and etc. The English people were granted the right to petition to the king to have free
election, for instance. The parliament was granted freedom of speech, assembly. This
revolutionary agitation swept the West most notably North America and France.
The Virginia Bill of Rights of 1776: it refers to sections of 1787 American constitution that
states the plain truth that men are created equal that are endowed by their creator with certain
inalienable rights that among these are life, liberty and pursuit of happiness. Furthermore, the
Virginia Bill of Rights contains to principles and mechanisms as to how protect the people from
possible tyranny of government, guarantee the people freedom of speech, press, peaceful
assembly, to petition government and impartial jury trial, and prohibits excessive fines, cruel
punishment, the forcing of persons to witness against him/herself etc.
The 1789 French Declaration of the Rights of Man and the Citizen: the Declaration
(containing a preamble and 17 Articles) embodies the living principle men are born free and
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equal in rights (Article 1). The declaration proclaims the end of all political association is the
preservation of the natural; individual regulated rights of man. It identifies these rights as the
right to liberty, property, security and resistance of oppression (Article 2).
The 1917 Bolshevik Revolution in Tsarist Russia: it was the major, if not the first socialist
revolution in the history of human kind. It has impact in maintaining socio-economic rights of
the people (like health, education, social security and welfare system to bring first economic and
the political and socio-cultural equalities, and etc.).
Modem Times
In the centuries after the Middle Ages, the concept of liberty became gradually separated from
status and came to be seen not as a privilege but as a right of all human beings. Spanish
theologists and jurists played a prominent role in this context. Among the former, the work of
Francisco de Vitoria (1486-1546) and Bartolomé de las Casas (1474-1566) should be
highlighted. These two men laid the (doctrinal) foundation for the recognition of freedom and
dignity of all humans by defending the personal rights of the indigenous peoples inhabiting the
territories colonised by the Spanish Crown.
The Enlightenment was decisive in the development of human rights concepts. The ideas of
Hugo Grotius (1583-1645), one of the fathers of modern international law, of Samuel von
Pufendorf (1632-1694), and of John Locke (1632-1704) attracted much interest in Europe in the
18th century. Locke, for instance, developed a comprehensive concept of natural rights; his list
of rights consisting of life, liberty and property. Jean-Jacques Rousseau (1712-1778) elaborated
the concept under which the sovereign derived his powers and the citizens their rights from a
social contract. The term human rights appeared for the first time in the French Déclaration des
Droits de l‘Homme et du Citoyen (1789).
There were factors responsible for the gradual shift from natural law as duties to natural law as
rights. Those factors, among others, were:
they themselves appropriated public properties.
precious value. The individual with all its duties and rights began to be respected. The rise of
Individualism.
-economic, cultural and political developments like renaissance (the rebirth of
ancient ideas, thoughts, literary), explosion of revolutions and birth of capitalism in the womb of
feudalism and the likes brought about to question the exercise of natural law duties.
the teachings of Thomas Aquinas (1224-1274), the teachings of Hugo Grotious (1583-1645), the
Writings of 17th century English philosopher John Locke and the works of 18th century
philosophers like Montesquieu, Voltaire and J.J. Rousseau.
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The idea of rights played a key role in the late 18th century struggle against political absolutism.
Accordingly, absolutism incited man to claim (human or natural) rights precisely because it
denied them. Though the heyday of natural rights proved short, the idea of human rights
nonetheless endured (survived) in one form or another. The abolition of slavery, popular
education trade unionism, the adult suffrage movement and other changes and impulses serve as
ample proof for the triumph of the idea of human rights. Though, for instant during the Nazi
Germany there were laws that authorize the dispossession and extermination of Jews and other
minorities; the laws that sanction arbitrary police, search and seizure; laws that approve
imprisonment, torture and execution without public trial. The rise and fall of the Nazi Germany
showed the necessity of realizing the principles of human rights as an important part of human
beings. Despite all these inhuman treatments, the first half of the 20th century marked the birth
of the international human right movement as well as the universal recognition of human rights.
B. The Establishment of the United Nations (UN) System in 1945

The signing of the Charter of the United Nations (UN) on 26 June 1945 brought human rights
within the sphere of international law. In the Treaty establishing the UN, all member states
pledge (promise) themselves to take joint and separate action for the achievement of universal
respect for and observance of human rights and fundamental freedoms for all without distinction
as to race, sex or religion. On December 10, 1948 the United Nations adopted the Universal
Declaration of Human Rights (UDHR). The Declaration contains a preamble and 30 articles.
Article3 of UDHR states "everyone has the right to life, liberty and security of person." The
designing of this article in such sense was an outcome of long and gradual process of the
movement for human rights.
Since the 1950s, the UDHR has been backed up by a large number of international conventions.
The most significant of these conventions are the International Covenant on Civil and Political
Rights (ICCPR) and the International Covenant on Economic, Social and Cultural Rights
(ICESCR).These two Covenants, together with the UDHR, form the International Bill of Human
Rights. At the same time, many supervisory mechanisms have been created, including those
responsible for monitoring compliance with the two Covenants.
Philosophical Foundation of Human Rights

The history of human rights reflects how human society has evolved in the exercise of duties and
rights. At one time duties were over and above rights. In later limes duties gave way to rights.
Duty is defined as legal or moral ob1igations, which a person is bound to do or not to do. In
some respects, duty is referred to moral obligations. On the other side rights are possibilities of
an individual to pad
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on or use without legal status and state intervention. As we discussed above, the idea of human
rights developed out of the natural rights theories of early modern period. It emerged to replace
the phrase Natural rights. The concept human rights are modern arrival and are now used as on
everyday language. Human rights are fundamental rights of human being. But how does being
human give rise to rights? What it Mean to be human? To answer these questions we need
approaches to a human nature (right).
A. Philosophical Approach
This approach holds that human nature is the source of human rights. It indicates what human
beings might become rather than what they have been. Human rights on an account of a life of
dignity to which human beings are by nature suited and the kind of person worthy have and
entitled to such a life. The effective implementation of human rights should result in a self-
fulfilling moral prophecy.
Many philosophers hold divergent view on human nature as well as rights. No philosophical
theory of human nature has ever achieved wide spread acceptance. For example, Marxian
explains moral beliefs and norms in terms of class structure and struggle, which are determined
by the means and mode of production. ―Human nature is the result of historical processes that
shape human beings in to socially prescribed molds rather than the reflection of an inherent
essence or potential. For Marxists it is pointless to speak of equal and inalienable rights held by
all people simply because they are human probably makes no sense to Marxists.
John Locke was recognized for his theory of 'Natural. Law' which is the backbone of bill of
rights. Locke argued that certain rights are self-evident and pertain to individuals as human
beings (because they existed in the 'state of nature' before mankind 'entered macro civil society).
These rights, according to Locke are individual's rights to life and liberty (freedom from arbitrary
rule) and property. The moral, justification for the existence of government, according to Locke
is to liberate the individual from economic, political religious and moral restriction. This is
possible by institutionalizing constitutional government whose powers are limited. Therefore
according to this philosopher, government is enemy of human rights and constitutionalism is the
solution. This is because the constitution makers of the 18th and 19th centuries (following the
idea of John Locke) advocate that human beings are naturally free and that government is
artificial creation of human people rather than a universal creation of nature.
Locke and his followers recognized that people's rights are unsafe in a state of anarchy, for when
human aggressions are entirely unstrained. The consequence is danger over the rights of the
people
a grave danger that the mightiest rules. On the other hand a government is indispensable to the
protection of the rights of all humans strong and weak alike. Here lies a dilemma: human rights
cannot be preserved without government, but government itself is inherently hostile to those
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rights. The only way Locke and other philosophers suggest resolving the dilemma was to
organize government that maintain law and order without abridging (restricting) people's rights.
The organization should be based on the principle of constitutionalism. Government will operate
within strict limits specified by constitutions. The constitution restrains government power by
listing what government may not do (in bill of rights), by defining what government may do (list
of enumerated powers), by establishing separation of powers (applying check and balance
system).
In other words, Lock argued that the state of nature has a law of nature to govern it. According to
him natural law not only conferred rights but also imposed duties on man. The majority people
obeyed the natural law and performed duties according to it. Lock‘s state of nature; therefore it
was a state in which man had rights. He pointed that governments is important to protect these
natural rights.
He seems to say natural law provides human rights owned by each individual. A primary purpose
of public authority is to secure these rights in legal practice. No public authority can transgress
human rights. Individual are equal and autonomous beings.
B. The Scientific approach to Human Rights

This theory involves an empirical investigation of psychobiological make up of human beings
and ground human rights on basic human needs such as – life, Food, Protection against cruel or
in human treatment. But, this approach is criticized that it provides inadequate list of human
rights. Might be few specific human rights can be grounded in the psychological and
biochemical sciences, this theory is incapable of providing an appropriate theory of human rights
(nature), because we have human rights not what we need for health, but to what we need for
human dignity.
C. A social or Anthropological Approach

This approach seeks to ground human rights on cross – cultural consensus faces problems. It tries
to associate the development of human rights through time with different cultures. Many cultures
have sanctioned slavery, matricide, blood feuds and execution of dissidents.
Chapter Two
Classification, Basic Features Of Human Rights and States‟ Obligations
Classifications of Human Rights

To understand better the debate over the content and legitimate scope of human rights, it is
useful to note the dominant approaches and action that have informed the human rights tradition
since the beginnings of modem times. Human rights are classified in generational categories that
are rooted in. human history (as cited in New Encyclopedia Britannica, Volume 20 1987). The
French Jurist Karel Vasak advanced the notion of three generations human rights. He was
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inspired by the three themes (Liberty, Equality and Solidarity) of French Revolution (1789). The
classifications were:
A. First Generation Rights named Civil and Political Rights ---

Liberty Rights
B. Second Generation Rights named Economic, Social and
Cultural Rights---Equality Rights
C. Third Generation Rights named solidarity rights or fraternity Rights
These generation rights are rooted in human history. They are outcomes of revolutionary
outbreaks and human relations. The 1789 French Revolution and 1776 American Declaration of
Independence were seminal in the birth to First Generation Rights, as the 1917 Bolshevik
Revolution was important in the development and birth of the Second Generation of Rights.
Finally the very human solidarity and altruism gave birth to Third Generation Rights.
A. First Generation Rights

First generation rights Refer to civil and political rights. They are based on political philosophy
of liberal individualism and economic doctrine of laissez fair. First generation rights require the
state to abstain from interfering in the life of the individual. Civil and political rights are
considered as negative rights that block governmental interference in to the private domain.
These rights are derived from liberalist position which asserts that individuals possess right to
liberty, the right to life, the exercise of freedom of speech and so on that these rights are
inalienable and unconditional and that the primary function of government is to protect these
right. Their origin is the American Declaration of independence and the French Declaration of
the rights man and of the citizen of 1789 and becomes the corner stone of the political thinking
of 19th c and 20th c liberalism.
First generation rights became associated with a set of liberal principles, personal rights matter;
public authority should respect personal autonomy and preferences. The core idea of these rights
centers on respect for personal rights, based above all on the equal worth of the individual,
whose preferences should be followed in the public domain. These rights are core rights as they
are stated in the Universal Declaration of Human Rights of 1948.
First generation rights include:
air and public trial
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ate in government directly or through election
B. Second Generation Rights

Second Generation Rights refer to economic social and cultural rights. These rights require the
extended function of the state to ensure economic and cultural rights. They are also termed as
positive rights ―because the need state intervention in fulfilling the quest for these rights. The
economic social and cultural rights led to the emergence of welfare stare. For example increasing
of refugee and disaster problems demand expanding public Policies. Second generation rights are
sometimes known as equality rights.
Economic, social and cultural rights are entitlements to socially provided goods and services
such as food, health care, social insurance, education and the rights to property. For example the
right to work is a right to economic participation and the right to education and to participate in
the cultural life of the community provide asocial dimension to the idea of personal autonomy.
The second-generation rights focusing on economic, social and cultural rights are stated in article
22-27 of the UDHR. Accordingly, they, among others include:
-being of self and family

to education and the right to the protection of one's scientific, literary and artistic
production.
The internationalization of these rights has been very slow compared to the first generation
rights. The International covenant on Economic, Social and Cultural rights were open to
signature on January 31, 1976 and it took time to enter into force. All these claimed rights tend to
be collective right requiring the concerted efforts of all social and political forces at national and
global scale. The majority of these rights are aspiration in their character (what states and
peoples aspire to be).
A. The Third Generation Rights

Finally, the third generation or solidarity rights are even more seen as collective rights, based on
notions of international solidarity and relating to global structural problems rather than individual
cases. As indicated in Article 28 of the Universal Declarative of Human Rights, which proclaims
that 'ever one is entitled to a social and international order in which the rights set forth in this
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Declaration can be fully realized,' it appears so far to embrace six claimed rights. Three of these
reflect the emergence of Third World Nationalism and its demand for a global redistribution of
power, wealth, and other important values:
right to political, economic and social development;
All five of these rights tend to be collective rights, requiring the concerted efforts of all social
forces, to substantial degree on global scale. Usually they are claimed in group.
Thus, at various stages of modern history-following the 'bourgeois' revolutions of the 17th and
18th centuries, the socialist and Marxist revolutions of the early 20th century, and the anti-
colonialist revolutions that began immediately following WWII the content of human rights has
been broadly defined, not with any expectation that the rights associated with the generation
would or should become outdated upon the ascendancy of another, but comprehensively or
supplemental.
This is not, however, to imply that each of these three generations of rights is equally acceptable
to all or that they or their separate elements are greeted with equal urgency. First generation
proponents, for example, are inclined to exclude second and third generation rights from their
definition of human rights altogether (or, at best, to label them as "derivative"). In part, this is
due to the complexities that in form the process of putting these rights in to action. The
suggestion of greater feasibility that attends first generation rights because they stress the
absence rather than the presence of government is somehow transformed in to a prerequisite of a
comprehensive definition of human rights, such that the aspired and vaguely asserted claims to
entitlement are deemed not to be rights at all. The most forceful explanation, however, is stained
with ideological and political baggage. Persuaded that egalitarian claims against the rich,
particularly where collectively espoused, are unworkable without a severe decline in liberty and
quality (in part because they involve state intervention for the redistribution of privately held
resources), first generation proponents, inspired by natural law and laissez faire traditions, are
partial to the view that human rights are inherently independent from civil society and are
individualistic.
Conversely, second and third generation defenders often look upon first generation rights, at
least as commonly practiced, as insufficiently attentive to material human needs and, indeed, as
legitimating instruments in service to unjust domestic, transnational, and international social
orders-hence constituting a 'bourgeois illusion'. Accordingly, while not placing first-generation
rights outside their definition of human rights, they tend to assign such rights a low status and
therefore to treat them as long-term goals that will come to pass only with fundamental economic
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and social transformations to be realized progressively and fully consummated only sometime in
the future.
In sum, different conceptions of rights particularly emerging conceptions contain the potential
for challenging the legitimacy and supremacy not only of one another but, more importantly, of
the political-social systems with which they are most intimately associated. As a consequence
there is sharp disagreement about the legitimate scope of human rights and about the priorities
that are claimed among them.
On final analysis, however, this liberty-equality and individualist-collectivist debate over the
legitimacy and priorities of human rights can be precarious and misleading. It is useful, certainly,
insofar as it calls attention to the way in which notions of liberty and individualism can be, and
have been, used to rationalize the abuses of capitalism; and it is useful, too, insofar as it
highlights how notions of equality and collectivism can be, and have been, alibis for
authoritarian governance. But in the end it risks obscuring at least three essential truths that must
be taken in to account if the contemporary worldwide human rights movement is to be
objectively understood.
First, one-sided characterizations of legitimacy and priority are likely, over the long term, to
undermine the political credibility of their proponents and the defensibility of their particularistic
values. In an increasingly interdependent and interpenetrating global community, any human
rights orientation that does not genuinely support the widest possible shaping and sharing of all
values among all human beings is likely to provoke widespread skepticism. The last half of the
20th century is replete with examples.
Second, such characterizations do not accurately mirror behavioral reality. In the real world,
despite differences in cultural tradition and ideological style, there exists a rising and overriding
insistence upon the equitable production and distribution of all basic values. Essentially
individualistic societies tolerate, ever promote, certain collectivist valves; likewise, essentially
communal societies tolerate, even promote, certain individualistic values. Ours is a more-or-less,
not an either-or, world.
Finally, none of the international human rights instruments currently in force or proposed say
anything whatsoever about the legitimacy or rank ordering of the rights. There is disagreement,
to be sure, among lawyers, moralists and political scientists about the legitimacy and hierarchy of
claimed rights when they treat the problem of implementation. For example, some insist on
certain civil and political guarantees, whereas others defer initially to conditions of material and
corporeal well-being. Such disagreements, however, partake of political agendas and have little
if any conceptual utility. As the UN General Assembly has repeatedly confirmed, all human
rights are an indivisible whole.
Basic Features of Human Rights

The following are fundamental features of human rights. These are not exhaustive but contain
the main features of human rights.
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Universality of Human Rights: universality refers to the applicability of human rights to all
people everywhere at all times. This positioning of human rights as universal is often questioned
and debated upon among scholars of relativist convictions who argue that human rights are
relative. But, as Piechowiak says, often, the debate between Universalists and relativists is in the
abstract. So while .universality and inherence are contested in theory, they are .acceptable in
practice. As evidence, she cites state practices and the Vienna Declaration and Program of
Action of 1993 which states, in explicit terms, that human rights are .the birth right of all human
beings and that the universal nature of these rights and freedoms is beyond question.
Universalism rejects their particularity in essence. It also underscores the fact that human rights
are trans-temporal and, as such, pre-exist laws and states. The Universalist approach of human
rights is attributed to the fact that one can use nature, God or reason to identify basic rights
inherent to every human and also these rights pre-exist society. So, the phrase inherent to every
human and pre-exist society implies that the right is emerged with the creation of an individual
person and should not be subordinate to arbitrary institutions. Hence, human rights are a
universal entitlement which is possessed by all individuals across the globe by virtue of being
human. Human Rights are Inherent (in human dignity): Inherence refers to the existence of
rights independently of the will of either an individual human being or a group of people. Thus,
they are neither obtained nor granted through any human action. They exist in spite of the fact
that one has the will or capacity to exercise them. It is rooted in human dignity.
Human rights are Inalienable: Inalienability implies that nobody can deprive anyone of these
rights and nobody can renounce these rights by himself. This is because the uniqueness of being
human- the substance in which the whole idea of human rights is rooted-being, the ground for
assigning dignity to each and every human being, cannot allow an infringement or outright
violation. Inalienability is partly grounded in taking every human being as an end rather than as a
means to further other ends.
Equality: equality as an attribute of human rights reminds us that everyone is entitled to rights
not as a consequence of, for example, being able to exercise free choices or to think logically but
rather because there are no human beings which are more human than others. Because these
rights are consistent and based on human nature the following elements are not factors of
difference in the application of human rights. They are applied equally at any condition, place
and time irrespective
of sex, ethnic group, color, language, nation, age, citizenship, religion, political outlook, social
position, etc. Human Rights are unassailable. They cannot be attacked during promotion and
protection. Human rights are eternal. As far as human society exists on earth human rights
continue to exist. In addition, any change in government, and any change in social, political,
economic outlooks do not have impact on human rights.
Human rights are irreducible. Human rights cannot be reduced to different interpretation.
Human rights are applicable in their fuller forms.
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Human rights are indisputable. Human rights are not subjected to different arguments. As they
are natural, we cannot argue over the elements of human rights.
Human rights are not to be given by government. Government is not a body that gives human
rights. In the meantime, we cannot inherit human rights rather we possess them by our nature of
human being. They are not transferred rights.
States‟ Obligations and Human Rights
The world order as envisaged by the Charter of the United Nations is based on a spatial
distribution of jurisdiction and responsibility between sovereign states, each being in charge of
the maintenance of law and order and of the promotion of social development within its borders.
The exercise of their respective jurisdictions should be based, however, on universal human
rights. Consequently, states have the primary responsibility for human rights observance within
their respective borders The Universal Declaration listed the rights they should take into account.
The subsequent standard-setting determined in broad outline the nature of state obligations,
which have subsequently been further developed through the practice of the charter-based and
treaty-based human rights bodies.
The responsibility is somewhat differently formulated in the treaties. Under Article 2 of the
Covenant on Civil and Political Rights, every state party ―undertakes to respect and to ensure to
all individuals within its territory and subject to its jurisdiction‖ the rights recognised in that
convention. Under the Covenant on Economic, Social and Cultural Rights, each state party
undertakes in Article 2 to ―take steps … to the maximum of its available resources, with a view
to achieving progressively the full realisation of the rights recognised‖ in that covenant.
It should be noted that every state, including those which have not ratified one or more of the
treaties, has a responsibility for human rights observance which flows directly from the UN
Charter and the Universal Declaration, since the latter can be held to spell out the rights that were
briefly referred to
in the Charter, itself a binding international instrument. Ratification of the conventions adds
specificity, however, to the responsibility of the states. By becoming parties to the conventions
they submit themselves to detailed monitoring by the treaty bodies set up for each of the main
conventions.
At the beginning of the new millennium, every state in the world has become a party to at least
two of the main conventions.
The State bears a responsibility of meeting the obligations recognized in the UDHR and Human
right covenants. Under human rights law as set out in the International Bill of Human Rights, the
state as an agent of the national community has positive roles to perform. Responsibility under
international law for the realisation of human rights rests with the state. To live up to its
responsibility the state must shoulder three sets of obligations: to respect the freedom of the
individual; to protect that freedom and other human rights against third parties; and, where
required, to provide access to welfare covering basic needs such as food, shelter, education and
health.
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The general or commonly agreed rule with respect to the role of the state is –Respect, Protect,
Fulfill (facilitates and provide).The obligation to respect in article 2 of the CCPR requires that
the state and its organ abstain from any action that hampers the realization of human rights. This
indicates the negative character of Civil and political rights. It means that States Parties must
refrain from restricting the exercise of these rights where such is not expressly allowed. For
instance the state must refrain from practicing torture under all circumstances, even in the event
of national emergency because prohibition of torture is absolute as stated in article 7 of the
convention.
From the other perspective, States must respect individual attempts to solve economic, social and
cultural problems on their own so long as they‘re not blocked from doing so by another. The
obligation to protect obliges the State to positively prevent violations and guarantee access to
legal remedies. The states must protect the integrity of the individual so they are free to equally
attempt to Solve problems (prevent discrimination and threats made by those who attempt to take
advantage of others–this normally includes a legal system). People must have an opportunity to
take charge of their own destiny. Fulfill–some will nevertheless require assistance from the state
because they lack enough resources (esp. with economic or natural disasters). Facilitate
individual attempts to solve own problems (e.g. vocational training & technical advice, Provide
for those who nevertheless cannot achieve rights.
In light of evolving practice at the international level, there is now a broad consensus level of
obligation on state parties: the obligations to respect, to protect and to fulfil. In turn, the
obligation to fulfil incorporates an obligation both to facilitate and to provide. These obligations
apply to all categories of human rights, but there is a difference of emphasis. For some of the
civil rights, the main concern is with the obligation to respect, while for some economic and
social rights, the elements of protection and provision become more important. Nevertheless, the
three-fold set of obligations for states – to respect, protect and fulfil – applies to the whole
system of human rights, and must be taken into account in our understanding of good governance
from a human rights perspective.
The central point is that depending on the types of Human rights state has various as well as
crucial obligations. Concerning Civil and political rights the state is supposed to respect and
refrain from intervention (negative prohibition) and ensure (positive duty) without discrimination
(CCPR, Art. 2 (1). Regarding Economic, social and cultural rights the state has primary
responsibility to take steps and achieve progressively to the maximum extent of a state‘s ability–
obligations of result.
The state has the obligation to fulfill the economic, social and cultural rights of everyone by way
of facilitation or direct provision. The process of facilitation takes many forms, some of which
are spelled out in the relevant instruments. For example, under the CESCR (Article 11(2)), the
state shall take measures to improve the production, conservation and distribution of food by
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making full use of technical and scientific knowledge and by developing or reforming agrarian
systems. The obligation to fulfill by way of provision could consist of making available what is
required to satisfy basic needs, such as food or resources that can be used for food (direct food
aid or social security) when no other possibility exists The obligation to fulfill entails facilitating
and promoting human rights. Hustad (2006) argues that the state is most often the protector of
human rights, even though it is human rights law that protects the individual from the state. The
state must aim at meeting the obligations to respect, protect and fulfill the fundamental human
rights of citizens.
The obligation of realisation has broader implications and refers to the cultural and social domain
and entails the evolution and creation of conditions under which the normative standards are
implemented and respected in practice. It may require a wide range of measures by the state,
including the establishment and proper functioning of courts, law enforcement agencies, welfare
institutions and others. But it also requires acceptance among the public: knowledge of their own
rights, respect for the rights of other members of society, and co-operation in order to contribute
to the common welfare. In brief, it is a question of an evolving human rights culture. It also
requires the adoption of international measures of co-operation and assistance.
Criticisms on Human Rights and Cultural Relativism
Criticisms on Human Rights

Critics of Human rights point out that the claim that human rights are universal rights ignores the
fact that human beings are different. Universality, they say is, the outcome of the dominance of
the western states over human rights discourse since Second World War. The ‗Universality‘ of
Human rights is considered as an ideological means through which ‗Cultural imperialism‘ is
imposed on non-western Countries. The tension between universality and difference in the
concept of human rights has been expressed in different literatures and Conventions (Freeman,
2002:102).
The challenge against the idea of universal human rights comes from Asian and African states.
The argument was that there are distinct African and Asian conceptions of Human rights. The
basis for this challenge was said to be the existence a different Culture of non-western Societies
and/or the special needs of poor countries. This reflects that the notion of the Universality of
human rights is challenging by the emerging Cultural interpretation of Human rights.
It is commonly said that the concept of human rights is based on a Western conception of liberal
individualism, and this conception has no roots in many non-Western Cultures (Aido, 1993; Bell
et al.1995). The Western culture see individual as a rational political and economic actor. In
contrary, the Asian and African culture gives emphasis on collective identity. The contradiction
emanates
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from this cultural root. These implies that the western conception of human rights and human
dignity have limited viability and applicability in the non-western world.
he interdependent set factors account for the limited applicability of Human rights broadly can
be divided into two categories: The cultural patterns and developmental goals of states including
the ideological framework within which they were formulated. Traditional Cultures in Asia and
Africa did not view the individual as autonomous and possessed of rights above and prior to
Society. The individual was conceived of as an integral part of a greater whole, of a ‗group‘
within which one has defined role and status. The basic unit of Asian and African Society has
varied kinship system, the clan, the tribe, the local community –but not the individual. The basic
criticism relies on the foundation of human rights did not take into account cultural differences.
The notion of the primacy of the group and submission of the individual to the group persisted in
non-western Society. Asian scholars have argued that the international human right norms are
incompatible with Asian values, which ought to receive priority.
The other critics centered on the Economic and cultural rights. It is a well-known fact that
economic, social and cultural rights are surrounded by controversies both of an ideological and
technical nature. To some, they are not true rights at all, while others even accord them priority
over civil and political rights. From among western states many Americans and British
conservatives have argued that economic, social and cultural are really human rights. The critics
is that economic, social and cultural rights which are entitlements to socially provided goods,
services and opportunities such as food, health care and education are less important than civil
and political rights to the western States.
The two categories of rights have been seen as two different concepts and their differences have
been characterised as a dichotomy. According to this view, civil and political rights are
considered to be expressed in a very precise language, imposing merely negative obligations
which do not require resources for their implementation, and which, therefore, can be applied
immediately. On the other hand, economic, social and cultural rights are considered to be
expressed in vague terms, imposing only positive obligations conditional on the existence of
resources and therefore involving a progressive realisation.
As a consequence of these alleged differences, it has been argued that civil and political rights
are justiciable whereas economic, social and cultural rights are not. In other words, this view
holds than only violations of civil and political rights can be adjudicated by judicial or similar
bodies, while, economic, social and cultural rights are ‗by their nature‘ non-justiciable.
Culture and Human Rights

The Universal Declaration of Human Rights states, in article one that all human beings are born
equal in rights. The Vienna Declaration of 1993 affirms that all human rights are universal,
indivisible and interdependent. Human rights theorists on their part say that all human beings
have human rights simply because they are Human beings (Donnelly, 1993). However, as a legal
standard adopted through the United Nations, universal human rights and Vienna convention
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represents the hard-won consensus of the international community, not the cultural imperialism
of any particular region or set of traditions.
The resulting confluence of peoples and cultures is an increasingly global, multicultural world
brimming with tension, confusion and conflict in the process of its adjustment to pluralism.
There is an understandable urge to return to old conventions, traditional cultures, fundamental
values, and the familiar, seemingly secure, sense of one's identity. Without a secure sense of
identity amidst the turmoil of transition, people may resort to isolationism, ethno-centrism and
intolerance.
This climate of change and acute vulnerability raises new challenges to our ongoing pursuit of
universal human rights. How can human rights be reconciled with the clash of cultures that has
come to characterize our time? Cultural background is one of the primary sources of identity. It
is the source for a great deal of self-definition, expression, and sense of group belonging. As
cultures interact and intermix, cultural identities change. This process can be enriching, but
disorienting. The current insecurity of cultural identity reflects fundamental changes in how we
define and express who we are today.
Universalism and Relativism

Human rights as treated moral rights refer to a moral standard of what is right and wrong.
However the question is whether there is a universal standard? This question leads to relativist
and objectivist/universalist perspectives of human rights. This discourse of Universalism and
relativism sharpens a long-standing dilemma: How can universal human rights exist in a
culturally diverse world? As the international community becomes increasingly integrated, how
can cultural diversity and integrity be respected? Is a global culture inevitable?
If so, is the world ready for it? How could a global culture emerge based on and guided by
human dignity and tolerance? These are some of the issues, concerns and questions underlying
the debate over universal human rights and cultural relativism.
Cultural relativism is the assertion that human values, far from being universal, vary a great deal
according to different cultural perspectives. It is a belief that moral values in the conception of
human rights are determined by history culture, economics or some other social force. Radical
relativism sees culture (or history, economics) as the source of all values. Such a position denies
the very idea of human rights, for it holds that there are no tights that everyone is entitled to
equally, simply as human being. It ignored the principle that human existence of human rights
possessed by all human beings independent of society and irrespective of their particular history
or culture.
The view is that some would apply this relativism to the promotion, protection, interpretation and
application of human rights which could be interpreted differently within different cultural,
ethnic and religious traditions. In other words, according to this view, human rights are culturally
relative rather than universal. This is in line with modern western view that there are no
absoluteness, that everything is relative. It was argued human rights are relative because human
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beings are constrained within limits of their own existence, which could be in terms of culture,
religion, economy, ethnicity, class and so on. These values must be respected and it is not
permissible to impose universal values up on them. Relativists argue that universality of human
rights is an ideological disguise for ‗cultural imperialism‘ which is pro individual. This emanates
because the concept human rights is based on western conception of liberal individualism.
Freeman (2002:101-114) argues that this relativism would pose a dangerous threat to the
effectiveness of international law and the international system of human rights that has been
constructed over the decades. If cultural tradition alone governs State‘s compliance with
international standards, then widespread disregard, abuse and violation of human rights would be
given legitimacy.
Accordingly, the promotion and protection of human rights perceived as culturally relative
would only be subject to State discretion, rather than international legal imperative. By rejecting
or disregarding their legal obligation to promote and protect universal human rights, States
advocating cultural relativism could raise their own cultural norms and particularities above
international law and standards.
Therefore, for cultural relativists, culture is a key premise for legitimate human rights action,
while for others, culture and particularly cultural diversity is a threat to the effective guarantee of
universal human rights standards. For Universalists the human rights and Fundamental freedoms
are the birthrights of all human beings‘ and the universal nature of these rights and freedoms is
beyond question. Although there are numerous intermediate perspectives, the tension between
the so-called relativists on the one hand and Universalists on the other is sufficiently entrenched
so as to form a central theme of the modern human rights narrative.
Universalism and International Law

Largely through the ongoing work of the United Nations, the universality of human rights has
been clearly established and recognized in international law. Human rights are emphasized
among the purposes of the United Nations as proclaimed in its Charter, which states that human
rights are "for all without distinction". Human rights are the natural-born rights for every human
being, universally. They are not privileges.
The Charter further commits the United Nations and all Member States to action promoting
"universal respect for, and observance of, human rights and fundamental freedoms". As the
cornerstone of the International Bill of Rights, the Universal Declaration of Human Rights
affirms consensus on a universal standard of human rights. In the recent issue of A Global
Agenda, Charles Norchi points out that the Universal Declaration "represents a broader
consensus on human dignity than does any single culture or tradition".
Universal human rights are further established by the two international covenants on human
rights (International Covenant on Economic, Social and Cultural Rights, and International
Covenant on Civil and Political Rights), and the other international standard-setting instruments
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which address numerous concerns, including genocide, slavery, torture, racial discrimination,
discrimination against women, rights of the child, minorities and religious tolerance.
These achievements in human rights standard-setting span nearly five decades of work by the
United Nations General Assembly and other parts of the United Nations system. As an assembly
of nearly every State in the international community, the General Assembly is a uniquely
representative body authorized to address and advance the protection and promotion of human
rights. As such, it serves as an excellent indicator of international consensus on human rights.
This consensus is embodied in the language of the Universal Declaration itself. The universal
nature of human rights is literally written into the title of the Universal Declaration of Human
Rights. Its Preamble proclaims the Declaration as a "common standard of achievement for all
peoples and all nations".
This statement is echoed most recently in the Vienna Declaration and Program of Action, which
repeats the same language to reaffirm the status of the Universal Declaration as a "common
standard" for everyone. Adopted in June 1993 by the United Nations World Conference on
Human Rights in Austria, the Vienna Declaration affirms the universality of human rights,
stating, "All human rights are universal, indivisible and interdependent and interrelated". This
means that political, civil, cultural, economic and social human rights are to be seen in their
entirety. One cannot pick and choose which rights to promote and protect. They are all of equal
value and apply to everyone.
As if to settle the matter once and for all, the Vienna Declaration states in its first paragraph that
"the universal nature" of all human rights and fundamental freedoms is "beyond question". The
unquestionable universality of human rights is presented in the context of the reaffirmation of the
obligation of States to promote and protect human rights.
The legal obligation is reaffirmed for all states to promote "universal respect for, and observance
and protection of, all human rights and fundamental freedoms for all". It is clearly stated that the
obligation of States is to promote universal respect for, and observance of, human rights. Not
selective, not relative, but universal respect, observance and protection.
Furthermore, the obligation is established for all States, in accordance with the Charter of the
United Nations and other instruments of human rights and international law. No State is exempt
from this obligation. All Member States of the United Nations have a legal obligation to promote
and protect human rights, regardless of particular cultural perspectives. Universal human rights
protection and promotion are asserted in the Vienna Declaration as the "first responsibility" of all
Governments.
In relation to this Universalists argue that all values, including human rights, are entirely
universal, in way subject to modification in light of culture or historical differences. In its pure
form, radical universalism hold that there is only one set of human rights applies at all times and
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in all places. This view is based on the idea that everyone is entitled to human rights without
discrimination of any kind. The non-discrimination principle is a fundamental rule of
international law. This means that
human rights are for all human beings, regardless of "race, color, sex, language, religion,
political or other opinion, national or social origin, property, birth or other status". Human rights
are intended for everyone, in every culture.
Human rights are the birthright of every person. If a State dismisses universal human rights on
the basis of cultural relativism, then rights would be denied to the persons living under that
State's authority. The denial or abuse of human rights is wrong, regardless of the violator's
culture. Universal human rights are a modern achievement, new to all cultures. Universal human
rights reflect the dynamic, coordinated efforts of the international community to achieve and
advance a common standard and international system of law to protect human dignity.
However, as discussed above challenge comes from cultural perspectives. The argument of
cultural relativism frequently includes or leads to the assertion that traditional culture is
sufficient to protect human dignity, and therefore universal human rights are unnecessary.
Furthermore, the argument continues, universal human rights can be intrusive and disruptive to
traditional protection of human life, liberty and security. When culture does effectively provide
such protection, then human rights by definition would be compatible, posing no threat to the
traditional culture. As such, the traditional culture can absorb and apply human rights, and the
governing State should be in a better position not only to ratify, but to effectively and fully
implement, the international standards.
Traditional culture is not a substitute for human rights; it is a cultural context in which human
rights must be established, integrated, promoted and protected. Human rights must be
approached in a way that is meaningful and relevant in diverse cultural contexts. Rather than
limit human rights to suit a given culture. There is an increased need to emphasize the common,
core values shared by all cultures: the value of life, social order and protection from arbitrary
rule. These basic values are embodied in human rights.
Cultures should be approached and recognized as partners to promote greater respect for and
observance of human rights. Drawing on compatible practices and common values from
traditional cultures would enhance and advance human rights promotion and protection. This
approach is not only encourages greater tolerance, mutual respect and understanding, but also
fosters more effective international cooperation for human rights.
Greater understanding of the ways in which traditional cultures protect the well-being of their
people would illuminate the common foundation of human dignity on which human rights
promotion and protection stand. This insight would enable human rights advocacy to assert the
cultural relevance, as well as the legal obligation, of universal human rights in diverse cultural
contexts. Recognition and appreciation of particular cultural contexts would serve to facilitate,
rather than reduce, human rights respect and observance.
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Working in this way with particular cultures inherently recognizes cultural integrity and
diversity, without compromising or diluting the unquestionably universal standard of human
rights. Such an approach is essential to ensure that the future will be guided above all by human
rights, non-discrimination, tolerance and cultural pluralism.
Human Rights and Democracy

The references to the existence of a link between democracy and human rights can be divided
into two groups. Some texts consider respect for human rights to be a prerequisite for
democracy, or the other way around. Other texts list that democracy and human rights are
interdependent and mutually reinforcing. The following section will examine the difference
between these two approaches and its consequences and possible significance?
Respect for human rights is often perceived to be a prerequisite for democracy or vice versa
namely that democracy constitutes a prerequisite for the respect of human rights. Sometimes
respecting human rights is perceived to be one of a set of various elements, including amongst
others -apart from respect for human rights- respect for the principles of the rule of law and
separation of powers. Other texts seem to consider respect for human rights as the only
requirement that needs to be fulfilled in order to be considered to be a democracy. For instance
the Siracusa Principles on the Limitation and Derogation Provisions in the International
Covenant on Civil and Political Rights for instance state ―the expression "in a democratic
society" shall be interpreted as imposing a further restriction on the limitation clauses it qualifies.
The burden is upon a state imposing limitations so qualified to demonstrate that the limitations
do not impair the democratic functioning of the society. While there is no single model of a
democratic society, a society which recognizes and respects the human rights set forth in the
United Nations Charter and the Universal Declaration of Human Rights may be viewed as
meeting this definition".
Other texts reverse the order and consider democracy to a be a prerequisite for respecting human
rights insinuating that in a democracy respect for human rights is best assured.
Defining democracy in function of human rights is incorrect and problematic as it suggests the
existence of a causal connection between the two. If a nation respects human rights it
automatically may be considered to be a democracy and a democracy automatically respects
human rights.
Respecting human rights does not automatically turn a nation into a democracy. Certain human
rights can adequately be protected in non-democracies. Conversely, the above made insinuation
that in a democracy respect for human rights is best assured is false. Empirical studies have
illustrated that a democracy does not necessarily entail better protection of human rights.
Democracy may even exacerbate ethnic conflict and lead to greater violations of human rights
especially in the period immediately following transition to a democratic system. Respect for
human rights is only said to increase at the end of the democratization process i.e. when a
democracy is well installed.
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In addition, longstanding democracies do not automatically provide the highest and best
protection of human rights. For instance, in many democracies (e.g. Belgium and the United
States) economic and social rights are not justiciable or only partly justiciable. Governments
might provide a variety of welfare benefits including food and shelter, medical care and access to
education. But citizens generally do not have the right to sue the government for such benefits in
court.
Often the term democracy is misused by nations claiming to be a democracy but massively
violating human rights for instance the Democratic Republic of the Congo or the Democratic
People‘s Republic of Korea. Thus ―official" or ―formal" democracies do not always adequately
protect human rights. However, they perfectly can adequately protect certain human rights (while
violating others).
The second manner to identify the link between democracy and human rights is to describe both
concepts as interdependent and mutually reinforcing. Stressing the interdependence and mutual
reinforcing character eliminates the causal connection between two concepts. ―Interdependent"
means that one cannot exist without the other. ―Mutually reinforcing" means that both concepts
directly or indirectly influence each other.
It is evident that a democracy cannot exist without human rights. It is also true that there is a
greater likelihood that human rights are ―better" respected. Democracy is often defined as a
―value" (see above). Democracy comes from the people; it requires a political and cultural
commitment. As such a democracy cannot be imposed from the outside as it consolidation
requires a generation in time. Proponents of the existence of a democratic entitlement in
international law argue that the emergence of a democratic entitlement in international law has
shed a new light on all existing rules and
legislation including human rights. More specifically, these authors argue that a state can only be
recognized if it is democratic ; that the internal aspect of the right to self-determination only
entails the rights to choose for a democratic form of governance and/or that the use of military
violence is allowed to promote and or defend/restore democracy when it is threatened.
Most of us would probably spontaneously hold that both democracy and human rights are
important. We are so used to speaking and hearing of them in conjunction that we often regard
them as more or less synonymous. Or we may think of human rights and democracy as sibling
concepts, both expressing a common notion of human autonomy, dignity and freedom.
Moreover, we usually see them not only as compatible in practice but also as conditions for each
other – we cannot have democracy if human rights are not safeguarded and where democracy is
lacking, the respect for human rights is usually wanting or worse. However, despite our common
intuitive and plausible notion that human rights and democracy are like two sides of a coin, so
that we cannot have one without the other, we may also easily think of cases where the two seem
to be in tension or outright conflict. For instance, should a constitution with a bill of rights or
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international human rights conventions lay constraints on what the sovereign people may decide
in a democratic order? And if so, could such individual rights be decided democratically? If we
perceive these questions as troubling, we also see why human rights and democracy may stand in
a more problematic relation to each other than the common sense notion reveals. It is hardly
surprising that human rights and democracy may serve to restrict what a self-determining polity,
however democratic its political system, may do towards its own members.
Chapter Three:
The Human Rights System
The UN Charter
Drawing lessons from the appalling atrocities of the Second World War, the UN Charter‘s
primary aim was thus to save succeeding generation from the scourge of war (preamble,
paragraph 2) and to ensure the maintenance of international peace and security. Within such
broad and ambitious objectives, a respect for human rights and fundamental freedoms found its
significant though ambivalent reflection. The Charter has demonstrated not only a move towards
the lasting and stable internationalization of human rights but it has also implied their
contribution to ensuring the establishment of the peaceful, post-war world order. It is apparent
that the signing of the Charter of the United Nations (UN) on 26 June 1945 brought human rights
within the sphere of international law. The Charter contains a number of articles specifically
referring to human rights.
As reflected in the preamble to the Charter, the United Nations were guided, among others, by
the motive to reaffirm faith in fundamental human rights, in the dignity and worth of the human
person, in the equal rights of men and women and of nations large and small (preamble,
paragraph 3). Having declared their lofty motives, the United Nations granted respect for human
rights the status of one of the fundamental purposes of the organization. The Charter sets out that
the purpose of the United Nations will be, inter alia, to achieve international cooperation also in
promoting and encouraging respect for human rights and for fundamental freedoms for all
without distinction as to race, sex, language, or religion (Article 1(3)).
Its Article 55 sets forth that with a view to the creation of conditions of stability and well-being
which are necessary for peaceful and friendly relations among nations based on respect for the
principle of equal rights and self-determination of peoples, the United Nations shall promote,
inter alia, universal respect for, and observance of human rights and fundamental freedoms for
all without distinction as to race, sex, language, or religion (Article 55(c)). As a direct extension
these provisions, Article 56 provides that all Members pledge themselves to take joint and
separate action in cooperation with the Organization for the achievement of the proposes set
forth in Article 55.
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With regard to implementation, the Charter translated its objectives and role in the field of
human rights into the functions and powers of number of UN organs. Thus, the General
Assembly was assigned the tasks of initiating studies and making recommendations for the
purpose, inter alia (among other things), of promoting international cooperation in the economic,
social, cultural,
educational, and health fields, and assisting in the realization of human rights and fundamental
freedoms for all without distinction as to race, sex, language, or religion (Article 13(b).
Generally, the UN Human rights machinery consists of three categories of institutions
A) Bodies which have been established directly on the basis of the UN charter, such as the
General Assembly, the security council, the Economic and social council and the commission on
Human Rights or Generally called UN principal organs
B) Bodies, which have been established indirectly by the UN charter that is whose creation was
authorized, by one of the bodies belonging to the first category. E.g. the sub commission on the
promotion of human rights etc. Generally called major subsidiary organs
C) Bodies which have been established on the basis of international treaties, for example the
human Rights committee under International covenant on civil and political rights, the
committee against all forms of discrimination and others. They are also called treaty specific
bodies.
The Security Council

The charter of the NU indicates that the Security Council is given primary responsibility for the
maintenance of international pence and security, which mean issues of peace and war, on
security issues the council could take legally binding decisions under chapter VII of charter
pertaining to enforcement action. Chapter 6, Article 39 of the charter says the Security Council
shall determine the existence of aggression and shall make recommendations or what measures
shall be taken. In addition, it might involve on economic, social, cultural and humanitarian
issues. On these issues the council could make recommendations. Presumably human rights fell
in to one of the categories such as social or humanitarian. But the council was authorized by the
charter of UN to take action to remove threats to the peace. Logically; threats to the peace could
arise from violation of human rights. But during its early age, when states attempted to bring
human rights issues before it, based on the fact on the ground that their relation with security, it
responded to human rights issues an inconsistent fashion being greatly the result of and affected
by the cold war. Later from 1960 onwards the council began to deal more systematically with
human rights issues linked with: racism giving rise to violence, human rights in armed conflict,
armed intervention across international boundaries, and armed supervision of election and
plebiscites (referendum.) During the cold war the Security Council sometimes asserted a link
between human rights issues and transnational violence.
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After the cold war the Security Council expanded the notion of international peace and security
and tries to involve in human rights issues increasingly. The line dividing security issues from
human rights issues was often blurred, the council thus expanded the range of chapter VII
enforcement action and stated, compared with the past, that human rights violations were linked
to international peace and security, thus permitting expansion of chapter VII and even leading to
an occasional enforcement action, the gross human rights violations, mostly in 1990s required
the potential increasing the UN security council's systematic action For human rights, based on
pooled or collective sovereignty.
David P. Forsythe (200:58) summarize the importance of Security Council‘s role in human rights
and problems it faces in five points,
1. First, there were numerous situations of violence in world affairs around the close of the cold
war, but the security council did not address all of them, particularly, problems which the major
states such as USA do not give emphasis For example Chechnya problem Sri Lanka and others
2. The Security Council has continued to say that human rights violations inside states can
threaten international peace and security and implying the possibility of enforcement action
under chapter VII to correct the violation. For example in 1992 a council summit meeting of
heads of state issued Avery impressive statement indicating that threats to security could arise
from economic, ecological and social causes not just traditional Military ones
3. The council sometimes made pronouncement on behalf of council authority, but proceeded to
seek extensive consent from parties to a conflict. This is the major problem to take collective
action to avoid problems that threatened international peace and security
4. The council has frequently deployed lightly armed forces in ―peacekeeping operations with the
consent of the parties, to help ensure, not simple peace, but democratic peace based on civil and
political rights.
5. The council has asserted the authority under chapter VII to create ad hoc (not permanent)
criminal courts, to prosecute and try those engaging in war crimes, crimes against humanity, and
genocide, The council has asserted that all member states of the UN are legally obligated to
cooperate with the ad hoc courts in order to peruse those who have committed gross violations of
internationally recognized human rights.
A number of factors lead to the expansion of the Security Council‘s roll in human rights issues,
in addition to security, recently most situations drew international attention, because of the
prevalence of mass killing, oppression and genocide inside states, For example the break of
Yugoslavia led to the death of many people. The Security Council, no longer paralyzed by cold
war divisions, responded in various ways to repression, oppression, civil war ethnic cleansing
and to other gross violations of human rights. The council also paid attention to murderous wars
in many countries, for instance Congo Kinshasa, Angola, sera Leon etc…
The most striking feature about Security Council‘s action especially in 1990 was its willingness
to deal with the origins of conflicts and it realizes that most fundamental issues were essentially
national rather than international. In states like Angola, Liberia Rwanda, the central issue of the
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conflict revolve around who governs‖ and how humanely, who governs implies the presence or
absence of democracy, free and fair election, freedoms of speech, belief and association. How
humanely implies the respect for all internationally recognized human rights,
In add it to the above, there are international dimensions to the conflict that pushed the council in
to action such as intra state war, refugees problems and some internal violence that expand to
engulf nearby states.
Generally, the bright aspect of the councils role is, its willingness to expand the notion of
security and try to improve the personal security of citizens inside various states by improving
attention to their human rights, the not- so- bright aspect of its roll is that the gap between
resolutions (decisions) of the council endorsing human rights and making reference to chapter
VII enforcement action and seeking of political will to take steps necessary to make council
resolutions effective on the ground. Reference to chapter VII enforcement action is implies that
the chapter VII of the UN charter did not provide with enough power to take legal action,
The overall record of the council on human rights issues after the cold war was complex clearly
the council was /is extensively involved in trying to help apply human rights standards than ever
before. It has demonstrated on a number of occasions that human rights protects could be
intertwined with considerations of peace and security. It had certainly blurred the boundaries of
state sovereignty and its corollary, domestic Jurisdiction. If it lacked collective political will, its
resolutions on human rights would not be effective.
The UN Commission on Human Rights

This commission was established in 1946 as subsidiary organ of ECOSOC with the task of
making studies, preparing recommendation and drafting international instruments on human
rights. In 1967 the commission was authorized by ECOSOC to hold an annual public debate on
gross violation of human rights and decide to examine situation, which reveal a consistent
pattern of violations of human rights, and to report with recommendations to ECOSOC.
The Economic and Social Council, was entrusted in Article 62 with a function to make
recommendations for the purposes of promoting respect for, and observance of, human rights
and fundamental freedoms for all (paragraph 2) and to prepare draft conventions for submission
to the General Assembly, with respect to matters falling within its competence) paragraph 3). For
organizational purposes, Article 68 provides that the Economic and Social Council shall set up
commissions in economic and social fields and for the promotion of human rights, and such
other commissions as may be required for the performance of its functions.
The commission is the center of the global human rights affairs. In its First, several years, the
commission devoted its principal efforts to work on the UDHR and international Human Rights
covenants. The elaboration of international human rights norms remains one of the commission's
most important activities, but its early ages the commission on Human Rights under took no
serious monitoring or enforcement activities. For its twenty year it had no power to take any
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action with regard to complaints concerning human rights violations, ECOSOC denied the
omission even the right to see details of complaints in it Resolution 75, in 1947. This limited
range of the commission‘s activities reflected the conception sovereignty of states.
Furthermore, the members of the commission on human rights are representatives of and directed
by states, not independent experts. Latter in 1967, ECOSOC authorized the commission to
discuss publicly human rights violation in particular countries. This change was made possible
primarily in the greater number of developing countries in the organization and some states
began to talk about specific human rights in the organization. Since then the commission began
to move toward more protection activities rather than promotional ones, it moved from standard
seething to monitor and supervise all states behavior related to international human rights
standards.
It may be concluded that both the number and the scope of human rights provisions in the UN
Charter is prima facie quite impressive in itself. This becomes particularly evident when the UN
Charters is contrasted with its predecessor, the Covenant of the League of Nations, which was
entirely silent on human rights issues. However, as a reflection of the compromise reached at the
San Francisco Conference in 1945, the human rights clauses of the Charter show signs of
ambivalence and vagueness.
Since 1945, the UN has done a lot of ‗Standard setting, institution building and human right
promotion. The Capacity of the UN to implement its own standards is still not effective. It has
faced with challenges in promoting the respect of Human rights. Several factors make the
implementation of Human right standards uneven and generally weak (Freeman, 2002:51). The
following are some of the major constraints:
case of human rights.

-interference in the internal affairs of Member States.
The members of United Nations are sovereign states. They are the principal subjects of
international human rights obligations and the principal violators of international human rights,
are the same sovereign states. There is Wide spread lip-service to human rights by governments
and much hypocrisy. They do not grant the UN significant enforcement powers. The principle of
non-intervention limited the activities of the commission on human rights. Consequently, the
failure of the UN to respond effectively to the situation in Rwanda, despite the fact that it
received early warning of the genocide, shows that its limitation can still lead to disaster. It is
clear that the UN carried a human right revolution in world politics, but is a long revolution in its
early stages, and success is not guaranteed.
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INTERNATIONAL BILL OF HUMAN RIGHTS
Universal Declaration of Human Rights (UDHR)
The covenant of the leagues of Nations did not mention human rights; in contrast the charter of
United Nations endorses the fundamental human rights and fundamental Freedoms. Article one
of the Un charter lists among the main purposes of the United Nations is to achieve international
cooptation in promoting and encouraging respect for human rights and fundamental freedoms for
all without distinction on the basis of race, language, sex, culture, political opinion etc.
In accordance with article 55 of the charter the UN has the duty to promote Universal respect for
and observance of human rights and fundamental freedoms for all, in addition Article 56 says, all
members pledge themselves to take jointly and separate action in co-operation with the
organization for the achievement of the purposes set forth in article 55.
However, the charter specifically apart from the right to non- discrimination does not define the
fundamental human rights, which the members of the UN have to respect. But it is true that
human rights really emerged as standard subject of international relations through the United
National (UN). The UN was devoted to elaborate and establish strong international human rights
standard, as result the general Assembly adopted the universal Declaration of Human Rights on
December 10, 1948. The 1948, 217(A) General Assembly resolution provides the most
authoritative statement of international Human rights norms.
The articles of United Nations Charter with regard to human rights are vague and general. In
order to define the fundamental human rights and to provide specific standards for the guidance
of international community the need to adopt declaration emanates. The task of preparing a
declaration was given to the Commission on Human Rights which started its work in 1947 and
established for that purpose a drafting committee of eight members chaired by Mrs. Eleanor
Roosevelt. In 1948 the Commission adopted the draft Declaration and submitted it through the
Economic and Social Council to the General Assembly. After lengthy discussions at the General
Assembly the Declaration was adopted on 10 December 1948 during the third session of the
Assembly in Paris. Forty-eight (48) states voted in favor, non-against and eight abstain (the
Soviet Unions and its allies the on ground that economic and social rights were not sufficiently
developed).
The UDHR, represent an authoritative statement of international human rights norms, standard of
behavior to which all states should aspire. This was a decisive step. In codifying the guideline
that shows states therein which states treat their own citizens. The adoption of declaration of the
human rights was envisaged as the very first item on the United Nations agenda within the
program of the International Bill of Human Rights.
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The Universal Declaration is made up of the Preamble and 30 articles which comprise its
operative part. Typically for international instruments, the Preamble spells out the philosophy,
motives and purposes which guided the drafters of the Universal Declaration. In the Declaration,
its articles 1 and 2 state that all human beings are born equal in dignity and rights and are entitled
to enjoy rights and freedoms set forth in the Declaration without any discrimination on the basis
of sex, language, religion, political opinion, national or social origin, etc. Its implication is that
all human beings shall enjoy freedom and be treated as equals
That Declaration, given its intended worldwide application, was a historical event without
precedent in any earlier stage of the evolution of global civilization. It clarifies the content of
human rights, which were only vaguely referred to in the UN Charter. The Declaration sets out a
wide-range of human rights and freedoms to be protected ranging from civil and political rights
Articles 3-21 to civil and political rights
on and opinion.
In the Declaration less extensive is the catalogue of economic, social and cultural rights (Articles
22 to 27). This contains the right to social security, the right to work, the right to rest and leisure,
the right to an adequate standard of living, the right to education, and the right to participate in
the cultural life. The declaration also spells out a concept of the duties of everyone to the
community (Article 29(1)) and permissible limitations in the exercise of the human rights and
freedoms (Article 29(2)). And the fourth principle provides for the prohibition of activates by
any State, group or person aimed at the destruction of the rights and freedoms set forth in the
Declaration (Article 30). It recognize that everyone is entitled to a social and international order
in which human rights set further in the declaration may be realized. It emphasizes that each
person has duties to the community in which he lives.
The Declaration has no binding legal force, it is only a declaration, and it makes no provision for
its implementation. It allocates rights to everyone. It says little about who is obliged to do what
to ensure that these rights are respected. In 1948 the UN was committed to state sovereignty. It
could not decide what was to be done if sovereign states violated human rights. At that time
virtually all governments said that the declaration was not legally binding. Therefore UDHR
doesn‘t impose any immediate duty up on member states to implement its provision. The reason
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is that the universal Declaration of Human rights is resolution of United Nations General
Assembly is not a treaty as such is not binding in international law.
The UDHR, adopted by a resolution of the United Nations General Assembly (UNGA), although
not a treaty, is the comprehensive human rights instrument adopted by the international
community. It has had considerable impact on the development of human rights and has been
partially incorporated into many national constitutions, has served as basis for national
legislation. The Declaration provides comprehensive list of human rights and freedoms to be
protected, it represents a consensus of the international community regarding human rights
which each of its members must respect, promote and observe.
The Declaration was made with the intention to follow with treaty or covenant to make it binding
But the process of producing covenants took longer time i.e. more than a decade, primarily
because of ideological rivalry over the status of economic and social rights. In subsequent years
after the adoption of the UDHR the increasing Cold War tensions between East and West
affected the work of the United Nations in human rights and other fields.
The world during the cold war, was divided in two blocks, Western block led by U. S. A. and
Eastern bloc led by U.S.S.R, their ideological difference was reflected on the issue of human
rights. The capitalist (the West) claims that civil and political rights are the most fundamental
rights to human beings. For them these rights are inherent and given for all, therefore primary
protection must be given to civil and political rights on the other hand. Communists east argues
that if there are no economic, social and cultural rights civil and political rights cannot be
realized therefore, primary attention must be given to economic freedoms. To compromise these
conflicting views in 1966 international convention on human rights were signed by two
documents that means two covenants formed in 1966.
The 1966 International Covenants on Human Rights

After the adoption of the Universal Declaration, the Commission on Human Rights based on the
second part of ―the Bill of Human Rights‖ namely the development of norms that were
undisputedly binding on those states that choose to adhere to them. The General Assembly at its
first session in 1946 assigned the commission the task of preparing an ―international bill of
rights.‖ Today, the International Bill of Rights is regarded as consisting of the Universal
Declaration of Human Rights, the International Covenant on Economic, Social and Cultural
Rights, and the International Covenant on Civil and Political Rights and its two optional
protocols. The commission proposed in 1950 to keep all rights in one convention. However,
USA and some other western countries argued against this proposal and in 1951 they succeeded
in persuading the General Assembly not to follow the recommendations of the Commission on
Human Rights but instead decided in favor of two separate conventions, on civil and political
rights and the other on economic, social and cultural rights. The arguments put forward by USA
and others were centered on asserted differences with regard to the possibility for the individual
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to legally enforce his rights and the different kind of monitoring mechanisms the two sets of
rights would require.
Today, most proponents of human rights emphasize on the interrelationship and mutually
reinforcing nature of the various human rights. The tendency in the subsequent development of
standards, starting already in the sixties with the Convention on the Elimination of Racial
Discrimination and onwards, has been to either bring up a particular subject and regulate it in
greater depth or to take up the protection needs of individuals or groups that are especially prone
to discrimination or in need of particular protection. Accordingly, civil, cultural, economic,
political and social rights are all dealt within those instruments.
It should also be noted that although the rights dealt with in the covenants are contained in two
different documents, it has been emphasized in UN resolutions and documents that the covenants
belong together and should be seen as a whole. In only a few instances, a state has decided to
adhere only to one of the two. As of January 2001, 146 states are parties to the Covenant on Civil
and Political rights and 142 states to the covenant on Economic, Social and Cultural Rights.
The two covenants contain some identical or similar provisions, such as the right to self-
determination (Article 17 both covenants) and the principle of non-discrimination (Article 2 of
both covenants). Also the safeguard clauses that the rights should not be used as a pretext for the
destruction of other rights, are the same (Article 5 of both covenants).
International Covenant on Civil and Political Rights (ICCPR)

In order to translate the UDHR in to binding instruments, on 16 December 1966 the General
Assembly adopted the international covenant on civil and political rights. This covenant comes
in to force in 1976. It consists of 53 articles. ICCPR is prepared to promote and protect rights and
freedoms such as the rights to life freedom from cruel or inhuman treatment, freedom from
slavery and forced or compulsory labor. Freedom from arbitrary arrest or detention, freedom to
choose residence, rights to human treatment, etc. right to equality, right to participate in public
affairs.
It also consists of a first optional protocol adopted at the same time as the Covenant in 1966,
establishing a procedure for individual complaints, and a second optional protocol, adopted in
1989 aiming at the abolition of the death penalty. As of January 2001, 98 states are parties to the
first protocol and 45 states to the second.
Pursuant to Article 28 of the Covenant, a Human Rights Committee is established, consisting of

18 members, who are nominated and elected by states but who serve in their individual capacity.
Its mandate is to consider the reports that all states parties are under a duty to submit regularly to
the committee, to consider interstate complaint and to deal with the individual complaints that
may come before it under the first optional protocol.
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States, which ratified the covenant, are required to submit reports on measures taken to
implement the covenant to the human right committee. This committee is elected by contracting
states for a four year term on the basis of equitable geographical representation. Under article
(42) of the covenant the committee is entitled to hear (communication with individuals and
receive and consider individuals communication alleging violation of ICCPR by the state.
On the basis of information submitted by the individual and the state in question the committee
considers the matter and then forwards its opinion to the state concerned and the individual.
Therefore, there is no judicial determination of the issue. The machinery for enforcement is thus
very weak.
International Covenant on Economic, Social and Cultural Rights (ICESCR)

The International Covenant on Economic, Social, and Cultural Rights entered in to force on 3
Jan 1976 the covenant covers three categories of rights and consists of 31 articles. The first 15
are of a normative character and the last 16 of a more procedural nature. In its normative articles
it sets out many of the fundamentals for the well-being and prosperity of an individual. Each
state party is under an obligation to undertake steps ―to the maximum of its available resources
with a view to achieving progressively the full realization of the rights recognized in the present
covenant, by all appropriate means, including particularly the adaption of legislative measures‖
(Article 27 the Covenant). A core provision is Article 11, which recognizes the rights of
everyone to an adequate standard of living, including adequate food, clothing and housing, and
to the continuous improvement of living conditions unfortunately, as the committee itself has
noted, in many parts of the world there exists a disturbingly large situation. Much debate had
been held on the difficulties to enforce and measure to what extent a state party is fulfilling its
obligation under the Covenant. However, several fundamental principles apply, e.g. the
important principle of non-discrimination. Also, the exercise of particular economic, social or
cultural rights presupposed or is linked to the exercise and enjoyment of rights of a civil or
political nature. For example, the enjoyment of many cultural rights presupposes the rights to
freedom of association, of religion and expression.
Taking economic, social and cultural rights seriously implies at the same time a commitment to
social integration, solidarity and equality, including tackling the question of income distribution.
Economic, social and cultural rights include a major concern with the protection of vulnerable
groups, such as the poor, the handicapped and indigenous peoples.
The covenant on Economic, Social and Cultural Rights do not make provision for the
establishment of a separate treaty body. Instead, the responsibility for the supervision of the
Covenant is entrusted to the Economic and Social Council (ECOSOC) originally; the ECOSOC
delegated this work to a special group of government experts. However, in 1985, the ECOSOC
decided to instead create the Committee on Economic, Social and Cultural Rights, a body
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composed of eighteen members, elected by ECOSOC from a list of candidates nominated by

states parties for terms of four years. Members serve in their individual capacities, and meet
twice a year for sessions of three weeks duration. The main function of the committee, as will all
others of the six treaty bodies, is the examination of state report. Under the covenant it is stated
that the contracting parties (states who ratified) the covenant) are obliged to send periodic report
to the UN Economic and social council (ECOSOC) in implementation of its provisions (articles).
Convention on the Rights of the Child (CRC)

One of the first decisions of the General Assembly in 1946 was to create the United Nations
Fund for Children (UNICEF), an organization which during a first phase dealt primarily with
assistance to children affected by emergencies. In 1953 it was made a permanent body and its
mandate expanded to cover development issues and the welfare of children in a more general
sense. Now a day, UNICEF regards the promotion and protection of the rights set out in the 1989
Convention on the Rights of the Child as a general framework and mandate for all its activities
The Universal Declaration of Human Rights, adapted in 1948, recognized in article 25 that
―childhood is entitled to special care and assistance‖ and that ―all children, whether born in or
out of wedlock, shall enjoy the same social protection.‖ In 1959, the United Nations adopted a
Declaration on the Rights of the Child, where the rights from the old 1924 Declaration were
reaffirmed and further elaborated. The need to give the force of legally binding obligations to
children‘s rights also became more evident, and in 1979- the International Year of the Child- the
Commission on Human Rights started its work on the drafting of a convention. The drafting
process took ten years.
Finally, the convention on the rights of the child was adopted by the general Assembly on 20
Nov. 1989 and entered into force in 1990. The Convention on the Rights of the Child is the first
specific Human Rights treaty that has achieved an almost Universal adherence. As of January
2001 it has 190 states parties and only the United States and Somalia have failed to accede to the
Convention. It consists of 54 articles, of which the first 42 are of a normative character. The
Convention is all encompassing and sets up a holistic approach where civil, political, economic,
social and cultural rights are included, all being of importance for safeguarding the dignity of the
child and a harmonious development of his personality. A child is defined as ―every human
being below the age of eighteen years. Unless, under the law applicable to the child, majority is
attained earlier‖ (Article 1 of the Convention).
Four general principles have guided the authors of the Convention, and later been highlighted by
the committee on the Rights in the General Guidelines as the core message of the Convention.
Firstly, the principle of the full and equal value of children and that each child shall enjoy the
rights set out in the convention without discrimination, including equality of opportunity
between boys and girls; (Article 2 and 4 of the Convention.) Secondly, the principle that in all
actions concerning children the best interest of the child shall be the primarily consideration
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(Article 3 of the Convention). Thirdly, the principle of the right to life does not only entail the
right to be protected against being killed but a right to survival and development (Article 6 of the
Convention). Fourthly, the principle that children, who are capable of forming their own views,
shall also have the right to participate and express their views, which shall be duly respected
(Article 12 of the Convention).
The convention aimed at ensuring and protecting the rights and freedoms of children. It provides
that in all actions concerning children, the best interest of the child should be a primary
consideration. In other words state has responsibility to promote, protect and ensure and give
primary concern to the rights and freedoms of children. The convention sets out standard of
treatment of children in contracting states. The convention gives responsibility to the state to
implement its provisions.
In addition to the above four principles the convention stipulates variety of rights. The rights to
life, the rights to acquire nationality (art.7) the rights to freedom of expression, thought,
conscience and religion (art. 14), freedom from arbitrary or unlawful interference with privacy,
family etc. The articles of the convention also describe the commitment and agreement of states
to take measures to protect children from mental and physical violence, from economic
exploitation and use of drugs.
The Convention establishes a Committee on the Rights of the Child, originally composed of 10
members, but which the states parties in 1995, decided should be enlarged to 18 members. As of
January 2001 the amendment had not entered into force and the number of expert members
remains ten. The members of the committee are nominated and elected by states, but serve in
their personal capacity and those covenants of other international instruments. This committee
has the task of receiving reports from states on the implementation of the convention. The
committee itself submits reports every two years to the General Assembly through Economic and
social council (ECOSOC).
The committee held several general discussions on the rights of children. For example in 1992 it
discussed the question of children in armed conflicts (which is called second optional procedure)
and states are required to take all necessary measures to ensure that children under the age of 18
are not directly participating hostilities that any compulsory recruitment is above the age of 18.
The committee also discussed the problem of economic exploitation of children and under the
fourth optional protocol states are required to criminalize the sale of children and child
prostitution.
Convention on the Elimination of all forms of Discrimination against Women (CEDAW)

Before discussing the international convention on elimination of discrimination against women,
it is vital to describe the problems of women and its sources from feminist perspective. Feminists
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questioned patriarchal origin of citizenship and its continuing legacy in state citizen relations.
For example in ancient Athens citizenship status was given only to adult men, discriminate
women, slave and children. Further the feminists argue that state formation and reconstruction
from Westphalia were based on male citizenship, male leadership, male nationality, male
military service and male sacrifice. Even the suffrage extended to women indifferent countries
from 1893 onwards. They believed that this condition provides men with power over their wives
and made women dependent up on men. Feminists want the international system (relation) and
the development activities to be redefined.
The feminists advocate in their writing and participation at international conference contested the
gender neutrality of Human Rights, because the view that human rights are gender neutral
dominates human rights thinking, in theory, in law and popular opinion until the last few years.
For them the opinion of gender neutrality is not real. It is masculine bias in the promotion and
protection of human rights.
Unlit the late 1980‘s few authors and human rights experts within the United Nations or regional
bodies address the question whether women were enjoying the rights guaranteed to them in the
UDHR and the two covenants on civil and political rights and economic, social and cultural
rights, But there was no visible responses- in submission or reporting guide lines – from experts/
governmental or nongovernmental delegates to the UN commission on Human Rights,
It is true that women were described as child bearers and discriminated from political
participation, democracy and democratization process and benefits of development rather they
faced/ are facing or Experiencing harmful traditional practices and health problems than men.
Women were misrepresented in National and international institutions. Non-discrimination is
insufficient to prevent the daily violence and abuse that women experience. The essence of
women ―was described in terms of their fertility not their humanity. To avoid this UN finds
mechanisms (solution).
Equal rights of women and men are a basic principle of law embodied in the charter of the
United Nations and in numerous human rights instruments in the preamble and in the provisions
dealing with non-discrimination, e.g. Article 1, Paragraph 3 and Article 55of the Charter. This
principle is proclaimed in the Universal Declaration as well as in the two covenants (Articles 1
and 2 of the Universal Declaration and in both covenants, but in different paragraphs). In
addition, states parties specifically undertake to ensure the equal right of men and women to the
enjoyment of all rights set forth in each covenant (Article 3 of both covenants).
Despite this basic principle of non-discrimination and of integration of all human rights
regardless of gender, developments relating to their actual implementation in law and practice
have been slow. The United Nations has therefore from the outset tried to promote the necessary
changes in regard to the equal enjoyment by women of human rights and their equal status to
men. The creation of a special functional commission, the Commission on the Status of Women
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and a number of legal instruments relating to the enjoyment of women of human rights has been
decided upon. Such conventions have also been concluded within the framework of the
International Labor Organization (ILO), governing discrimination in employment, equal
remuneration, protection from hazardous work and maternity protection.
The commission on the status of women was established in the early days of the United Nations,
in 1943. In 1967, the General Assembly adopted the Declaration on the Elimination of
Discrimination against Women (DEDAW). This was a reaction based on a growing concern that
additional means for promoting and protecting equal enjoyment of human rights by women is
necessary.
In 1972 the secretary-General asked the Commission on the Status of Women to request the view
of member states as to the form and content of a possible legally binding instrument on the
subject. In 1974 the Commission began drafting a convention. The World Conference of the
International Women‘s year, held in Mexico-city in 1975, encouraged the work in its Plan of
Action. The Plan of Action called for convention on the elimination of discrimination against
women, with effective procedures for its implementation. In 1977 a draft instrument was
submitted to the General Assembly, which appointed a special working group to finalize the
draft.
In the course of the UN Decade for Women (1976-85) the international convention on the
Elimination of All forms of Discrimination against women (CEDAW) was adopted in 1979,
which has been ratified by 168 states. This convention is implemented by means of states‘
reports and came in to force in 1981. The reason for the adoption of the convention is to extend
women‘s rights provisions of the international bill of human rights.
The Convention consists of 30 Articles. The preamble of the convention remarked that despite
the existence of numerous covenants and conventions developed over a long period of time,
discrimination against women was endemic. The decade for women had come about in response
to the evidence that post- colonial develops to the evidence that post- colonial development was
not benefiting women when measured in terms of political participation, wealth, health and
education.
In the Convention, the definition of discrimination against women, contained in the first article,
is more detailed than in many other discrimination clauses. It was inspired by the definition of
racial discrimination as contained in the convention on that subject. In both its definition and in
other provisions the Convention on the Elimination of All Forms of Discrimination against
Women (Article 18 of the Convention) reflects the depth of exclusion and restriction practiced
against women because of their sex. It identifies many areas where there have been a notorious
discrimination against women; for example in regard to political and civil rights, economic rights
and employment. It calls for equal rights for women, regardless of their marital status. It calls for
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national legislation to ban discrimination. It allows for temporary special measures to accelerate
the achievement of equality between men and women.
The Convention provides for equal rights of women in political and public life, equal access to
education and employment, equality in access to health facilitates and an end to discrimination in
the field of finance and areas of economic and social rights. The Convention also stresses the
need to eliminate discrimination in all matters relating to marriage and family related matters and
stresses the social services needed especially childcare facilities for a full participation of women
in public life.
The convention established committee for the Elimination of Discrimination against Women
(CEDAW). The committee, consisting of 23 members nominated and elected by states parties,
was set up to supervise the implementation of the convention and receive reports. The
Committee operates very much like the human Rights committee in its review of reports, but it is
not authorize to receive individual communication. The work of the committee in violence was
further reinforced when, in 1993, the General Assembly adopted the Declaration on the
Elimination of Violence against Women. Another area of growing concerns was the search for
more effective measures to combat and suppress traffic in women and exploitation of prostitution
of women, a subject dealt with in the Convention (Article 6 of the Convention).
The other major supervisory body is the commission on the status of women created in 1946 by
Economic and social council. The commission is responsible for advancing the status of women
around the world it is made up of representatives 45 member states representing the major legal
system and reflecting the geographical distribution of UN membership.
The commission is empowered to make recommendations and reports to ECOSOC, on the
promotion of the rights of women in political, economic, social and educational fields. Although
authorized to study individual communications, it does not have the authority to study or
comment on conditions in individual countries.
Regional Instruments of Human Rights and the Role of Non-governmental Organizations

Introduction
There are important regional human rights instruments formulated to promote the respect of
human rights at regional level. In this lesson emphasis is given to two regional human right
standards such as European and African human rights instruments.
EUROPEAN CONVENTION ON HUMAN RIGHTS
Fifty years ago (in 1949) western European countries created the council of Europe. It is the first
post war European regional organization. Europe which was destroyed by the Second World War
founded the council of Europe, for encouraging and developing cooperation among countries. Its
aim as stated in article (1) of the statue is to achieve greater unity among states for the purpose of
safeguarding and realizing the ideals and principles, which are their common heritage, and
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facilitating their Economic and social progress. Article 3 includes principle of European council;
respect for human rights and the rule of law.
West European countries governments, from the beginning of European regionalism decided
that, the promotion and protection of civil and political rights are the core objectives of this
regional development. They made international human rights guarantee as part of the
reconstruction of Europe. They believed that the respect for rule of law and individual right in
regional system could be successful in avoiding future conflict and post war revolution impulses
backed by the soviet-Union. The statute of the council of Europe provides that each member‘s
state must ―accept principles of rule of law and of the enjoyment of by all persons with its
Jurisdiction of human rights and fundamental freedoms.
Later, these same states agreed to take steps for the collective enforcement of certain rights stated
in the Universal Declaration of Human Rights and adopted the contention for the protection of
Human Rights and Fundamental freedoms i.e. European convention on Human rights. This legal
instrument was approved in 1950 and took legal effect in 1953.It covers wide variety of civil and
political rights .Among the tights covered in the convention include the rights to life, prohibition
of torture and slavery, rights to liberty and security of person freedom of thoughts, conscience
and religion, freedom of expression, in addition, the European convention imposes obligations
up on states parties to respect provisions of the convention.
The convention gives emphasis mostly for negative or blocking rights. This is done to block
public officials‘ interference in the citizen‘s private domain, to block the government from over
steeping its authority when the citizen encounters public authority through arrest, detention and
trial and to guarantee citizen participation in public affairs.
The convention in its articles 25 and 46 states the conventions enforcement machinery. The
convention should be applied so as to make it safe guards practical and effective Therefore, the
European convention focused , primarily on developing machinery to supervise the
implementation and to enforce the guaranteed rights and freedoms, the European convention
initially established two institutions whose mandate was to ensure the observance of the
engagements under taken by the contracting parties, the European commission of Human Rights
and the European court of Human Rights, The convention also confers some supervisory
functions relating to the enforcement of rights to the committee of Ministers, the governing body,
the council of Europe.
A. EUROPEAN HUMAN RIGHTS COMMISSION

The European commission of Human Rights based in Strasbourg, France is the central
enforcement body of the European convention for the protection of Human rights and freedoms.
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The commission‘s principal function is to receive, review and evaluate, applicants complaints)
from individuals or the state.
B. THE COURT
The court is responsible to interpret the convention. Since it is a judicial body its decisions are
final and binding. The jurisdiction of the court extends to all cases involving the interpretation
and application of the convention, but only as regards those states which hare expressly
recognized the jurisdiction of the court. The court has the authority to take legally binding
decision on cases initially decided by the commission. This impels issues cannot be raised before
the court that have not been raised before the commission. The decisions of the European
commission and court and the general guidance provided by the European convention, have had
a considerable impact on law and practice in a number of European states.
Economic and social rights are specified in a separate European social charter. The charter was
signed in 1961, consists of labor rights, and trade union rights, the protection of specific groups
such as children, women, disabled persons and security rights. The council of Europe eventually
produced still other human rights documents including a 1986 convention for the prevention of
torture and a 1995 Framework convention for the protection of National Minorities
AFRICAN CHARTER ON HUMAN AND PEOPLES RIGHTS

The Organization of African Unity (OAU) adopted the African Charter on Human Rights in
1987, in Banjul, Gambia, and entered into force in 1986. The charter gives emphasis to collective
or people's rights and individual duties. The African charter on Human and people's rights
recognizes the equality of all peoples, the right to self-determination and their rights of all
peoples to development and to peace. The philosophy of emphasis in African charter on Human
rights was summed up by Cobbah, J as ‗I am because we are, and because we are therefore I am‘.
These also reflects the fact that Africans emphasize on groupings, sameness and commonality
The reason for focusing on the rights of peoples is to direct the attention of African states to
challenge the external, international threats to human rights, the threats posed by powerful
foreign governments, international markets and multinational corporation.
Although the charter focuses attention on the collective dimension of human rights and collective
goods of peace and development and more traditional human rights, it also mentions that every
individual shall have the rights to respect of the dignity inherent in human being and the
recognition of his legal status. All forms of exploitation and degradation of man particularly
slavery, slave trade, torture, cruel or inhuman or degrading punishment and treatment shall be
prohibited (Art. 5)
In addition to the above, the charter, discusses the duties of individual to serve his national
community by placing his physical and intellectual abilities at its service (Art 29((2) .The Africa
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charter is the First human rights convention that details the duties of the individual to the state
society, and family. under the duty individual it included the duties to avoid com promising the
security of the state and preserve and strengthen social and national solidarity and independence.
The charter set up the African commission on human and peoples‘ Rights charged with the
promotion and protection of the rights set out in the charter. It has the mandate to interpret and
implement the provision of the charter. The commission has important educational and
promotional responsibilities including under taking studies, organizing conferences
disseminating information and making recommendations to governments. The commission has
the rights to receive and examine complaints from individual or states. The commission may
hear interstate complaints and other non-state communications. An obligation is imposed up on
states to produce reports every two years. The commission has an authority to study the reports
submitted by states and make observations up on them and has adopted guidelines.
In 1998, the thirty-fourth summit of Head of State and Government of the OAU adopted a
protocol to the ACHPR for the establishment of an African Court on Human and People‘s
Rights.
NON-Governmental Organizations and Human Rights

International non-governmental organizations (INGOS) are made up of private individuals or
associations that is draw membership from individuals and private associations located in several
countries. Basically NGOS are non-profit making organizations. These groups exert influence on
states and international government organizations (IGOS) in many cases, among them Human
rights issues are their concern.
States by concluding treaties in international organization and conferences produce international

Human rights standards. Most states endorse the international Bill of Rights [universal
Declaration of Human Rights, international covenants on civil and political Rights and
international covenant on Economic social and cultural Rights (ICESCR)] in their National law.
Therefore international treaties of human rights primarily obligate states but private actors can
play important role in effecting exsiccation of states and implementation of human rights. They
exert influence in the formulation of laws on human Rights and its implementation.
NGOS advocate Human Rights ideas, which are focused on the creation and application of
Human Rights norms. For this the best-known example is amnesty international, it pushes for
more liberalism in the form of human rights protection in international Relations. Based on their
focus on particular human rights, NGOS can be divided into different categories such as private
advocates for human rights, relief or development.
A. Private Advocacy for Human Rights

There are many private organizations operate a cross borders that take the reason of their
existence (raison deter) the advocacy of the international law of human rights and humanitarian
affairs on a global basis. Some of these group have huge budget contain experts, and have access
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to global medias and they can contact (get) major government Among this group Human Rights
Watch, Amnesty International l, the International Federation For Human Rights, lawyers without
borders, antislavery International, play tremendous role in promoting and creating influence for
the respect ion and implementation of Human Rights across the world. The core advocacy
groups are NGOs or INGOS and governmentally created non- governmental organizations
(quasi-private human Rights organization (GONGO).
The oldest human rights NGOs concerned primarily with civil and political rights, in peacetime
and international humanitarian law during armed conflict. They advocate the importance of
respecting civil and political rights but after the cold war the range of their activities and their
number (NGOs active on human Rights) has been increased and they try to work together with
National Human Rights institutions. What is the instrument that NGOs use in their effort to
influence states to respect and implement Human Rights norms?
The bedrock of their work is collection of accurate information and its dissemination. For
advocacy groups reporting and dissemination of accurate Information enable them to generate
influence on government and other public authorities. On the basis of their analysis and
dissemination of information try to persuade public authorities to adopt new human rights
standards or apply those already adopted. This activity may be termed as lobbying.
The other major important role carried out by Human rights NGOs is that they publish
information in the hopes of long-term education. The purpose is to influence policy in the short
term through dissemination and they have strong belief that today‘s education may become the
context for tomorrow‘s policy making. Those educated today may be the policy makers of
tomorrow. They publish books; reports etc. and they make use of internet to disseminate their
information. For instance Amnesty international Publish magazine every year which shows
human rights violations across the world and in its report criticize certain states which commit
human rights violations seriously. Generally they wish to raise the consciousness of both policy
Makers and general public so as to provide a better environment for their lobbying efforts.
B. Private Action for Relief and Development

International Bill of Rights contains Economic rights such as the rights to adequate food,
clothing, shelter and medical care in peacetime and contains rights of emergency. Assistance –
refereeing to similar food, clothing, shelter and medical care in armed conflict. Private groups
working to implement this socio- economic rights in peace and war are not normally referred to
as human rights groups, but as relief (or humanitarian) and development agencies.
The private groups, which involve, in relief and development activities are frequently supported
by state donations one type or another, frequently work together with inter-governmental
organizations. Their activity is both private and public at the same time. In both relief and
development, the U.S and the European Union provide most of the resources. The UN agencies
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also involved such as UNICEF, The WHO, WFP, the UN development program etc. involved in
both relief and development.
Some argue that these rights are guaranteed by international law on the paper, it is weak to check
whether persons on the ground get basic needs or not, therefore, private groups try to turn the
law on the books in to the law in action. The major private agencies, which carried out important
functions, are the international committee on Red Cross, Doctors without borders, Oxfam and
save the children and others.
There is a process that private relief agencies should pass to provide assistance in armed conflict
or emergencies, these can be called challenges.
the gun on the ground;
hat is they
must control unneeded provisions;
mobilization, for example by creating linkage with domestic private groups, they have to deliver
the assistance in a timely and cost effective way.
NGOS that advocate human rights ideas (norms) that implement the right to humanitarian
assistance for those in need and that contribute for development have impacted both public
authorities and private individuals in a number of ways. They play a role in the implementation
of human rights standards, deliver humanitarian assistance, try to promote sustainable human
development and some extent make the people at grass root level beneficiary.
But NGOS, particularly involved in development activities are criticized for their achievement in
the third world countries. They bring the money in to third world countries, take it in the form of
salary or other form to their own workers, with doing nothing for the people, further, they got a
name ‗masters of poverty‖ that reflect their work (objective) is not bringing development but
worsening poverty in the third world countries.
Chapter Four
The Meaning and Foundations of Humanitarian Assistance
A. The Meaning of Humanitarianism and Humanitarian Assistance Humanitarianism is an

ideology focused on the value of human life. Humanitarian activities promote human dignity and
wellbeing through social reform, crisis response, public health initiatives and more. A key
principle of humanitarianism is that all people deserve equal dignity and human rights based
solely on the fact that they are members of humanity. Humanitarian activities are often supported
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by NGOs, major philanthropists, charity and volunteer organizations and governments. In 2014,
107 million people were affected by conflict, technological disasters, like plane crashes and
industrial accidents, and environmental disasters, like floods and earthquakes. With the help of
an international humanitarian system, the suffering of people affected by disasters can be
reduced and their dignity can be protected.
Humanitarianism is an active belief in the value of human life, whereby humans practice
benevolent treatment and provide assistance to other humans, in order to better humanity for
moral, altruistic and logical reasons. It is the philosophical belief in movement toward the
improvement of the human race in a variety of areas, used to describe a wide number of activities
relating specifically to human welfare. A practitioner is known as a humanitarian.
Humanitarianism is based on a view that all human beings deserve respect and dignity and
should be treated as such. Therefore, humanitarians work towards advancing the well-being of
humanity as a whole. It is the antithesis of the "us vs. them" mentality that characterizes tribalism
and ethnic nationalism. Humanitarians abhor slavery, violation of basic human rights, and
discrimination on the basis of features such as skin color, religion, ancestry, or place of birth.
Albert Schweitzer: "Humanitarianism consists in never sacrificing a human being to a purpose."
A universal doctrine
Jean Pictet, in his commentary on The Fundamental Principles of the Red Cross, argues for the
universal characteristics of humanitarianism:
The wellspring of the principle of humanity is in the essence of social morality which can be
summed up in a single sentence, whatsoever ye would that men should do to you, do ye even
so to them. This fundamental precept can be found, in almost identical form, in all the great
religions, Brahminism, Buddhism, Christianity, Confucianism, Islam, Judaism and Taoism. It is
also the golden rule of the positivists, who do not commit themselves to any religion but only to
the data of experience, in the name of reason alone. It is indeed not at all necessary to resort to
affective or transcendental concepts to recognize the advantage for men to work together to
improve their lot.
Historically, humanitarianism was publicly seen in the social reforms of the late 1800s and early
1900s, following the economic turmoil of the Industrial Revolution in England. Many of the
women in Great Britain who were involved with feminism during the 1900s also pushed
humanitarianism. The atrocious hours and working conditions of children and unskilled laborers
were made illegal by pressure on Parliament by humanitarians. The Factory Act of 1833 and the
Factory Act of 1844 were some of the most significant humanitarian bills passed in Parliament
following the Industrial Revolution.
In the middle of the 19th century, humanitarianism was central to the works of Florence
Nightingale and Henry Dunant in emergency response and in the latter case led to the founding
of the Red Cross.
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Today, humanitarianism is particularly used to describe the thinking and doctrines behind the
emergency response to humanitarian crises. In such cases it argues for a humanitarian response
based on humanitarian principles, particularly the principle of humanity.
Humanitarianism has existed in many ways throughout history. We can define humanitarianism
as providing assistance to those impacted by natural or human-induced disasters and conflicts.
Humanitarian assistance is intended to save lives, alleviate suffering and maintain human dignity
during and after man-made crises and disasters caused by natural hazards, as well as to prevent
and strengthen preparedness for when such situations occur.
Humanitarian Assistance: Aid that seeks to save lives and alleviate suffering of a crisis
affected population. Humanitarian assistance must be provided in accordance with the basic
humanitarian principles of humanity, impartiality and neutrality, as stated in General Assembly
Resolution 46/182. In addition, the UN seeks to provide humanitarian assistance with full respect
for the sovereignty of States. Assistance may be divided into three categories - direct assistance,
indirect assistance and infrastructure support - which have diminishing degrees of contact with
the affected population. (OCHA)
Assistance: Aid provided to address the physical, material and legal needs of persons of concern.
This may include food items, medical supplies, clothing, shelter, seeds and tools, as well as the
provision of infrastructure, such as schools and roads. ―Humanitarian assistance‖ refers to
assistance provided by humanitarian organizations for humanitarian purposes (i.e., non-political,
non-commercial, and non-military purposes).
Humanitarian Intervention: While there is no agreed upon international definition of

―humanitarian intervention‖ yet, it is a doctrine generally understood to mean coercive action by
States involving the use of armed force in another State without the consent of its government,
with or without authorization from the UN Security Council, for the purpose of preventing or
putting to a halt gross and massive violations of human rights or international humanitarian law.
The UN‘s operations in Northern Iraq and Somalia, and NATO‘s operation in Kosovo have all
been termed humanitarian intervention. (OCHA)
B. The Core Principles of Humanitarianism

There are four basic principles that govern humanitarian aid: Humanity, neutrality, impartiality
and independence. These principles were formally established by the UN General Assembly in
1991 (humanity, impartiality and neutrality) and 2004 (independence) and reiterated by the
ICRC. Humanity refers to the provision of aid to all who are in need, wherever the need exists,
with the purpose to protect and respect all human beings. Neutrality is the responsibility of aid
organizations not to choose sides in conflict or to favor a particular political, religious or
ideological bent. Impartiality demands aid be given based on need alone and not based on any
other distinctions including gender, race, nationality, ethnicity, class, political party or religious
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belief. Finally, independence refers to the requirement that aid organizations are autonomous
from any political or military objectives or with those goals in mind.
Several well accepted international documents elucidate and expound upon these principles. The
UN Code of Conduct, signed by more than 492 aid organizations, provides a set of common
standards for organizations involved in the provision of aid and a commitment to the four
principles. The code establishes humanitarian assistance as a right to be provided to citizens of
all countries, regardless of race, creed or nationality; without political agenda and with the
preservation of the recipient's dignity and respect for the recipient's culture. It also delineates the
need for transparency, capacity building and long-term planning for rebuilding and prevention of
future disasters; in this way it presents a framework for aid which is both present and forward
thinking. The Sphere Handbook was
written to develop a set of ―minimum standards‖ for international relief to be adopted by NGOs,
government and donor agencies. It was first published as a draft in 1998, and since has gone
through several iterations with a cadre of international agencies and impartial observers. The
Sphere handbook was devised by the Sphere project, a group of international NGOs who came
together with intentions to improve the effectiveness of humanitarian aid and encourage
accountability of aid organizations.
Underpinning humanitarian action are several major principles of humanitarian law, specifically
the rules set out by the Geneva conventions of 1949. While not directly addressing aid
organizations, they provide some justification for the provision of relief to civilians and wounded
military and impose upon the ratifying countries the obligation to allow assistance to be
provided. They also insist upon the provision of aid to be impartial, humanitarian and without
favoring one particular side of the conflict, thus strengthening the principles of neutrality and
impartiality.
Today, aid workers face an increasingly complex environment fraught with controversy, political
battles and multiple international organizations. As conflicts and disasters become more frequent
and increasingly geopolitical, adherence to the basic four principles becomes ever more
important. To alleviate suffering and mitigate the effects of disasters always remain at the
forefront of provision of aid.
Nicholas de Torrente, Executive Director of MSF-USA writes:

"The most important principles of humanitarian action are humanity, neutrality, independence
and impartiality, which posits the conviction that all people have equal dignity by virtue of their
being human based solely on need, without discrimination among recipients. Humanitarian
organizations must refrain from taking part in hostilities or taking actions that advantage one side
of the conflict over another, the action serves the interests of political, religious, or other
agendas." These fundamental principles serve two essential purposes. They embody
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humanitarian action‘s single-minded purpose of alleviating suffering, unconditionally and

without any ulterior motive. They also serve as background document to develop operational
tools that help in obtaining both the consent of communities for the presence and activities of
humanitarian organizations, particularly in highly volatile contexts. Humanitarian assistance
should be governed by the key humanitarian principles of: humanity, impartiality, neutrality and
independence. These are the fundamental principles of the International
Red Cross and Red Crescent Movement (IRCRC), which are reaffirmed in UN General
Assembly resolutions and enshrined in numerous humanitarian standards and guidelines.
- Humanity: Human suffering must be addressed wherever it is found, with particular attention to
the most vulnerable in the population, such as children, women and the elderly. The dignity and
rights of all victims must be respected and protected.
- Neutrality: Humanitarian assistance must be provided without engaging in hostilities or taking
sides in controversies of a political, religious or ideological nature.
- Impartiality: Humanitarian assistance must be provided without discriminating as to ethnic
origin, gender, nationality, political opinions, race or religion. Relief of the suffering must be
guided solely by needs and priority must be given to the most urgent cases of distress. (OCHA)
The first three principles (humanity, neutrality and impartiality) are endorsed in General
Assembly resolution 46/182, which was adopted in 1991. This resolution also established the
role of the Emergency Relief Coordinator (ERC). General Assembly resolution 58/114 (2004)
added independence as a fourth key principle underlying humanitarian action. The General
Assembly has repeatedly reaffirmed the importance of promoting and respecting these principles
within the framework of humanitarian assistance.
The principle of impartiality signifies that aid is provided regardless of the race, creed or
nationality of the recipients and without adverse distinction of any kind. This is of particular
importance in conflict situations, where the provision of aid should be equitably applied to both
sides dependent only on the need. Sometimes this aspect is not as assiduously adhered to by all
humanitarian agencies as possibly it should be. Indeed, the overriding importance of the
humanitarian imperative can sometimes be used by agencies to overlook, ignore or dismiss local
capacities in favor of their own capabilities.
As stated in the ICRC code, we will not tie of the promise, delivery or distribution of assistance
to the embracing or acceptance of a particular political or religious creed. Agencies will strive to
maintain their independence and, as such, will endeavor not to act as instruments of government
foreign policy. Essentially, non-government humanitarian organizations will act independently
of governments. This means they formulate their own policies and strategies and will not seek to
implement the policy of any government, except where such policies and strategies coincide with
the agency's independent stance.
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The principle of independence cannot be underestimated nor taken for granted, especially in the
current context, where counterterrorism understandings permeate the foreign policy motives of
donor governments. It is in this particularly charged context that perceptions of independence are
severely challenged and sometimes disastrous results for agencies, but more importantly for aid
workers in the field. Another aspect of independence is the desire of agencies to avoid single-
source funding, as this can lead to complications and an identification of the agency to the
principles and politics of the funding source.
C. History of Humanitarianism and Humanitarian Assistance

A Memory of Solferino (French: Un souvenir de Solférino) is a book of the Swiss humanist
Henry Dunant published in 1862. It proved decisive in the founding of the International
Committee of the Red Cross.
Witnessing the suffering of thousands of wounded soldiers of the Battle of Solferino in 1859 led
the Swiss Dunant to write the book A Memory of Solferino. In the book, he describes the battle,
the sufferings, and the organization of aid and asks:
ties for the purpose of
having care given to the wounded in wartime by zealous, devoted and thoroughly qualified
volunteers?"
different nationalities meet at Cologne or Châlons, would it not be desirable that they should take
advantage of this sort of congress to formulate some international principle, sanctioned by a
Convention inviolate in character, which, once agreed upon and ratified, might constitute the
basis for societies for the relief of the wounded in the different European countries?"
The publication of the book led to the establishment of the International Committee of the Red
Cross (International Red Cross and Red Crescent Movement) and the Geneva Conventions.
Broadly defined, the act of providing material assistance to people in need has existed
throughout human history, often in the form of food or material aid provided during famine,
drought or natural disaster. Yet the modern concept and system of humanitarian aid as we know
it; the impartial, independent and neutral provision of aid to those in immediate danger; has only
existed since the mid part of the 20th century. Although a system of international aid first
originated after World War
I with the Treaty of Versallies, a broadly accepted definition and key principles of humanitarian
aid have only become part of conventional wisdom since the 1990s.
The underpinning philosophies contributing to humanitarian action are diverse. Multiple
religious beliefs such as the concept of Christian charity prevalent in the West and the Islamic
tradition of Zakat are reflected, as are ethical concepts of appropriate wartime conduct. Issues
surrounding treatment of soldiers and civilians during conflict that has had perhaps the greatest
impact on the organization of humanitarian aid into the systems we see today; the horrors of war
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have led to many of the principles relevant to humanitarian aid. The empires of Greece and
Rome were among the first to record principles that outlined acceptable conduct in wartime;
likewise in ―The Art of War‖ Chinese general Sun Tzu alludes to appropriate conduct during
wartime. In more modern times the various Geneva conventions represent a modern consensus
on appropriate treatment of civilians, wounded soldiers and prisoners during conflict.
During the Black Death Pandemic of the middle ages, public health boards were created to
handle isolation, quarantine and disposal of bodies and represent the very beginnings of what
might be called disaster medicine. Modern technological advances in weaponry, transportation
and communication in the late 1800s enabled not only destruction of human life and property on
a never before seen scale; but also the communication of those events to the world at large. This
communication and transportation infrastructure also allowed the potential for timely
organization and provision of aid for the first time in history.
While today humanitarian aid is often thought of as response to natural and manmade disasters
such as hurricanes, earthquakes and typhoons, it was once almost exclusively related to military
conflict. The concept of appropriate treatment of wounded soldiers was put forth by Swiss
activist Henry Dunant in ―A Memory of Solferino‖ proposing a permanent relief agency to
provide aid to wounded soldiers and civilians during battle. This book prompted the creation of
the Red Cross in 1863; one of the first true international aid organizations. The Red Cross
received a formal mandate at the first Geneva Convention in 1864 to provide neutral and
impartial assistance to civilian and military victims of conflict under the organization of national
Red Cross Committees. The very beginnings of international monetary aid can likewise be traced
to the late 1800s with the Northern Chinese Famine of 1876-1879, which prompted one of the
first formal international relief funds.
After World War I, the Treaty of Versailles established the League of Nations, which would
become the United Nations (UN); the first permanent international organization tasked with
protecting vulnerable populations and maintaining peace. Post WWII there was a sudden and
unprecedented growth of non-governmental organizations (NGOs), with over 200 organizations
established in the 4 years immediately following. Aid began to become more global with
increasing advances in transportation and communication, and began to shift from Europe to the
less developed parts of the world. The term ―third world,‖ was initially used to describe countries
not aligned with North Atlantic Treaty Organization (first world) or the Soviet Block (second
world). It contained many of the poorly developed new, post-colonial governments in Africa,
Latin America and Asia and thus over time became collectively used to describe those
underdeveloped and impoverished countries. In the post-cold war humanitarian aid began to be
focused on those so-called third world countries as the ideas of development and
underdevelopment began to take hold in modern society. As NGOs proliferated, so did
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advertising campaigns with images of starving children, largely African; these images became
the dominant Western idea of humanitarian aid which tend to persist to this day.
There are many controversies surrounding the modern provision of aid; however the modern era
can be largely characterized by a shift in thinking from short term aid provision and mitigation of
suffering to development, largely provided by so-called developed countries. The rapid growth
of NGOs and aid organizations has been attributed to many causes, including increased need in
the post-colonial era, the proliferation of both natural and manmade disasters and an increasingly
integrated global system. However, it is important to note that this also points to a potential shift
in political and governmental interest and funding, with as-needed provision of assistance
preferred over long term and complex developmental strategy.
The face of humanitarian aid today is complex, with hundreds if not thousands of NGOs and
other organizations from many countries providing a variety of aid and development efforts.
Today, both armed conflict and natural disasters affect an ever increasing number of people.
Between 1980 and 2004, an estimated two million people were killed and five billion affected by
approximately 7,000 natural disasters with staggering economic and social costs. Around the
clock media outlets provide to the general public extensive coverage of many of these natural
disasters and conflicts, and internet and social media provide easy communication, organization
and fundraising. This proliferation has led to both positive and negative developments in aid
provision and will likely continue to greatly impact the delivery of aid far into the future.
Various ways of dividing the history of humanitarian action into chronological periods have been
proposed. Barnett has suggested three ‗ages of humanitarianism‘, reflecting his emphasis on the
ideological incarnations that the humanitarian sentiment has taken over time. Barnett identifies
‗an imperial humanitarianism, from the early nineteenth century through World War II; a neo-
humanitarianism from World War II through the end of the Cold War; and a liberal
humanitarianism, from the end of the Cold War to the present‘ (Barnett, 2011: 29). In a similar
vein, Walker and Maxwell (2009) view the world wars as marking distinct changes in the story
of the humanitarian sector; they characterize the period of the Cold War as one of ‗mercy and
manipulation‘ and the 1990s as the period of the ‗globalization of humanitarianism‘. Focusing on
disaster relief, Randolph Kent (1987: 36) sees the Second World War as a turning point, arguing
that ‗it was only in the midst of World War II that governments began to fully appreciate the
need for greater international intervention in the plight of disaster-stricken people‘. This mirrors
the chronology proposed by the influential historian Eric Hobsbawm (1994), who divided up the
‗short twentieth century‘ into two major eras, 1914–45 and 1946–89. French accounts of
humanitarianism, in contrast, have often emphasized the importance of the Cold War period and
specifically the Biafra/ Nigeria Civil War (1967–70) in promoting emergency relief (Ryfman,
2008: 19; Aeberhard, 1994; Davey, 2012).
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Four main periods have been identified: from the mid-nineteenth century until the end of the
First World War in 1918, when nineteenth-century conceptions drove humanitarian action; the
‗Wilsonian‘ period of the interwar years and the Second World War, when international
government was born and then reasserted; the Cold War period, when humanitarian actors turned
more concertedly towards the non-Western world and the development paradigm emerged; and
the post-Cold War period, when geopolitical changes again reshaped the terrain within which
humanitarians worked.
1. From the beginnings of the system until the First World War
In a broad cultural, political, philosophical and practical sense, ‗humanitarian‘ action can be
traced through hundreds of years of history, across the globe. Two of the most widely cited
forces – though it would be inaccurate to think of them as entirely distinct categories – are
religious belief and the articulation of laws of war. Christian ideas of charity have been
particularly important in Europe and North America, and scholarship has emphasized the
importance of charitable gestures in other religions, including notably the tradition of zakat in
Islam, one of several ways in which Islamic duty involves assisting others (Ghandour, 2002;
Benthall and Bellion-Jourdan, 2003; Krafess, 2005). Laws of war or limits on the acceptable
conduct of war were adopted in ancient Greece and Rome; articulated in The Art of War ascribed
to Sun Tzu in Warring States China; promoted by Saladin in the Middle East in the 1100s; taught
to Swedish soldiers by Gustavus Adolphus in the 1600s; and recognized in the tenets of
Hinduism, Islam and Judaism (Sinha, 2005; Cockayne, 2002; Solomon, 2005).
These precedents notwithstanding, a history of the modern humanitarian system can, for most
intents and purposes, identify its conceptual, operational and institutional roots in the nineteenth
century. A series of factors, especially in mid-century, is commonly understood to have
contributed to the flourishing of humanitarian initiatives at this time, of which the creation of the
ICRC in 1863 remains the most powerful example. The technologies of the industrializing
nations increased the human costs of conflict, and improvements in transport and
communications technology made the world a smaller place; the founders of the ICRC, for
instance, were highly conscious that ‗the very instantaneousness of communications‘ had helped
foster humanitarian efforts. In the words of one of their early publications: ‗Those who remain at
their hearths follow, step by step, so to speak, those who are fighting against the enemy; day by
day they receive intelligence of them, and when blood has been flowing, they learn the news
almost before it has been stanched, or has time to become cold‘ (Moynier and Appia, 1870: 51).
With information about war travelling more quickly, governments had greater incentive to
minimize its impact upon soldiers so as to contain discontent at home. As David Forsythe (2005:
16) notes, ‗armed conflict was becoming less and less a chivalrous jousting contest for the few,
and more and more a mass slaughter. Dunant was not the only one who noticed‘.
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Across the nineteenth century, military medicine saw a series of innovations such as the practice
of triage, instituted by Baron Dominique Jean Larrey during the Napoleonic Wars (1803–15),
and the refinement of medical transportation and evacuation, including notably during the
American Civil War (1861–65) (Haller, 1992). During the Crimean War (1854–65), Florence
Nightingale and her nursing team drastically reduced the mortality rates of British soldiers;
Nightingale was also one of the first to advocate for what would now be called ‗evidence-based
action‘. In a slightly different vein, the St John Ambulance association (established in 1887) was
part of the flourishing of humanitarian ideas in the nineteenth century. These initiatives were
local, or national, in the sense that they focused on the treatment of nationals from their own
countries, even though they often involved working abroad. They were distinct from the Red
Cross/Red Crescent Movement by virtue of the Red Cross‘ emphasis on standing, international
legal agreements, which provided a framework for action on behalf of citizens of other countries
as well as fellow nationals. In this, the Geneva Convention for the Amelioration of the Condition
of the Wounded in Armies in the Field (1864), in which the ICRC had a direct hand, had more in
common with the Hague Conventions (1899 and 1907), which likewise aimed to minimize the
impact of war by placing rules upon the conduct of hostilities.
Other areas of international cooperation of relevance to the history of humanitarian action also
took institutional form at this time. The first International Sanitary Conferences were held in the
1850s, and international medical conferences became a regular fixture; an international Health,
Maritime and Quarantine Board was established in 1881 in Alexandria, later becoming the
Eastern Mediterranean Regional Office (EMRO) of the World Health Organization (WHO)
(Roemer, 1994: 406–08). Natural disaster response was another generator of international as well
as domestic efforts in the late nineteenth and early twentieth centuries. In the mid-1800s,
regulations for assistance practice began to be codified through laws for emergency
communications, disease control and vessels in distress (IFRC, 2007: 25). In the United States,
the end of the Civil War (1861–65) allowed the American Red Cross (ARC) to direct its
attention towards a series of hazards including floods in 1889 and a hurricane in 1900. When a
major earthquake struck San Francisco on 18 April 1906, more than 28,000 buildings were
destroyed and some 36,000 people left homeless (Hutchinson, 2000: 10). The following year a
large earthquake and subsequent fire in the Jamaican capital Kingston virtually flattened the city,
leaving some 1,000 of its inhabitants dead and causing around £1.6 million-worth of damage. In
1908, another earthquake, this time in Italy, left more than 75,000 dead and approximately half a
million people homeless. In all three cases, international assistance was a major part of the
response; in the aftermath of the Kingston earthquake, for example, British, US and French naval
ships provided immediate assistance and medical care, and relief and reconstruction funds
flowed in from around the Empire (HMSO, 1907). In the wake of these disasters, the first
International Congress of Lifesaving and First Aid in the Event of Accidents was held in
Frankfurt in 1908.
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Imperial expansion also provided a context for efforts to ameliorate the suffering of others,
through public works, epidemiology and other ‗improvements‘ in the colonies. Although
territorial conquest began in the sixteenth century and imperialist ambition arguably peaked in
the nineteenth, colonial structures of power continued until decolonization in the second half of
the twentieth century. Colonial practices represent a point of overlap between state, secular and
religious versions of humanitarian action, with missionaries forming an integral part of the
colonial project, even if not always perfectly aligned with colonial policies (Barnett and Weiss,
2008: 22). As a recent call for further study pointed out:
It is not a simple matter of resemblance – how contemporary humanitarian action appears to
echo the patterns and ambitions of earlier imperial ‗projects‘– but that the two phenomena are
ultimately bound together in a series of mutually constituting histories, in which the ideas and
practices associated with imperial politics and administration have both been shaped by
and have in themselves informed developing notions of humanitarianism (Skinner and Lester,
2013: 731).
From the nineteenth century until decolonization, the colonial field served as a laboratory for the
techniques of later humanitarian action, including famine relief, the provision of cash assistance
to the needy and colonial medicine and health services. Like emergency relief on European soil,
the first beneficiaries of medicine in the colonies were Europeans. The first task of missionary
doctors was to address the sharp attrition rates of mission members due to disease; between 1860
and 1917, 17.5% of members of the Universities‘ Mission to Central Africa (UCMA) died and a
further 18.8% had to be transferred home due to illness (Jennings, 2008: 42). Treatments were
later extended to indigenous populations, and the proselytizing aspect of missionary activity was
often subsumed into medical work in the conviction that the benefits of medical science would
by themselves promote conversion (see for example Bjørnlund, 2008). The provision of health
services to indigenous populations was also a response to the need to protect colonial workforces
from disease. The link between colonial health and colonial labor was exemplified by the South
African Institute for Medical Research (SAIMR), which was founded in 1913 and funded by the
Chamber of Mines to carry out research on diseases that affected mine laborers (Farley, 1988:
194).
Colonial practices have an important yet complex relationship with contemporary humanitarian
action. In India, the Famine Codes established by the colonial state defined famine and proposed
ways of measuring it, as well as providing guidelines to govern prevention and response. These
codes, developed in the early 1880s after a series of devastating crises, were influenced by
Victorian ideas about the ‗deserving poor‘ in that they sought to limit relief as much as possible
to those who were deemed ‗really destitute‘ and therefore morally deserving of assistance
(Kalpagam, 2000: 433). There were however significant differences in attitudes towards
beneficiaries in the colonies as compared to at home: ‗while the British were committed to the
maintenance of the eligible poor in England, they refused to consider this as a possibility in
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normal times in India, preferring to rely upon the private charitable institutions and practices of
the people over whom they ruled‘ (Brennan, 1984: 93). Cash and food relief rates in the Famine
Codes were set at roughly 75% of the prevailing labor rate, so as not to provide a disincentive to
those who could find work. The emphasis was on emergency relief, which was to be planned and
systematized, but would not constitute general assistance. The principles of the Indian Famine
Codes were influential in other parts of the British colonial empire, including Sudan (see De
Waal, 1989), and remained so for decades.
Humanitarian action in the early twentieth century thus encompassed, as early histories of
humanitarianism indicated, a broad range of activities (Carlton, 1906; Parmelee, 1915). Yet often
and increasingly so as nationalist tensions rose prior to 1914 – war, and the mitigation of its
human impacts, was at the forefront. The Red Cross/Red Crescent Movement was a leading
forum for international humanitarian cooperation, thanks to its work during the Franco-Prussian
War (1870–71) and other late-nineteenth-century conflicts. Beyond Western Europe and North
America, the Ottoman Red Crescent Society (founded in 1868) and the Japanese National
Society (founded in 1877) provided relief in conflicts such as the Russo-Turkish War (1877–78)
and the Russo-Japanese War (1904–05) (see Checkland, 1994).
Despite this growing expertise, the vast extent of the humanitarian challenges posed by the First
World War was almost entirely unexpected. The personal and material resources available to the
ICRC at the beginning of the war bore no relation to the enormity of the work it would
accomplish between 1914 and 1918 in assisting the huge numbers of prisoners of war (POWs)
captured during the conflict – even at the peak of the war, the Committee employed only 41
delegates (Forsythe, 2005: 33). Although the ICRC was never directly appointed the task of
caring for POWs (Moorehead, 1998: 187), it assisted communications between POWs and their
families, campaigned for the repatriation of gravely wounded or ill soldiers, helped unite families
and facilitated the work of the National Societies. Likewise, while it has never formally been
appointed as the watchdog for observance of the Geneva Convention and laws of war, this
rapidly became part of the ICRC‘s wartime role.
In providing prisoner assistance, the ICRC cooperated with the Catholic and Protestant churches,
as well as Jewish and Muslim associations. Delegates from neutral countries carried out camp
inspections, as did Church bodies such as the Mission Catholique Suisse. In addition, Red Cross
Societies from the Nordic countries provided relief to POW camps in Siberia and supported the
repatriation of prisoners from Russia after the war. Gerald Davis (1993: 32) argues that the
Swedish and Danish National Societies in particular were able to exploit their ‗double neutrality‘
to gain access to prisoners and other victims of war in Russian-held territories. The ICRC was
also able to negotiate access to non-international armed conflicts in this period; including the
Finnish Civil War (1918) and the Hungarian Revolution led by Béla Kun (1919) (see Freymond,
1969).
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2. The Wilsonian period and Second World War reforms

Humanitarian needs in the early interwar years often derived from the Great War – food security
issues, disease (including the influenza epidemic of 1918–19), mass displacement and issues
around statelessness caused notably by the withdrawal of citizenship from those who had left
Russia after the Bolshevik Revolution. In the 1930s, the Depression brought widespread poverty
but also prompted welfare regimes such as the US New Deal. Refugee crises remained
prominent, as the repressive policies of the Nazi regime in Germany contributed to the flight of
minority groups, above all Jews, into other European countries. Beyond Europe, greater
realization of the challenges facing colonial populations contributed to more systematic and
scientific approaches to issues such as nutrition and public health. Eventually, however, the
turmoil of the Second World War resonated throughout the colonial territories as well as in the
metropolitan centers. In Europe alone – not counting the war in the Pacific, for instance– over
34m people died (Roberts, 1996: 581). While many accounts see the Second World War as the
beginning of a new age for humanitarian action, it can also be regarded as being in continuity
with the major reforms that took place in the aftermath of the First World War. The institutional
developments of the interwar period foreshadowed those of the 1940s by heralding the
emergence of a new, modern and international humanitarianism which – unlike previous efforts–
was ‗envisioned by its participants and protagonists as a permanent, transnational, institutional,
and secular regime for understanding and addressing the root causes of human suffering‘
(Watenpaugh, 2010: 1319).
The first swathe of humanitarian reforms came with the Treaty of Versailles in 1919, which
regulated the end of the First World War and instigated the creation of international
organizations to address humanitarian issues. The League of Nations, established through Part I
of the Treaty of Versailles, was a central part of US President Woodrow Wilson‘s vision of
international reform and the first permanent international organization whose mission was to
maintain world peace. As well as the goal of preventing war through collective security (via
disarmament, negotiation and arbitration), the League‘s Covenant and related treaties covered
issues including labor conditions, the treatment of indigenous inhabitants in colonial territories
and the protection of minorities and displaced people in Europe (see Pedersen, 2007).
One of the most important reforms of the interwar period was the League‘s creation of the post
of High Commissioner for Refugees (HCR) under Dr Fridtjof Nansen, a well-known Norwegian
polar explorer and scientist. Initially, the High Commissioner‘s mandate was limited to Russian
refugees and his office‘s role to coordination rather than actual operations. However, through a
combination of diplomacy, the respect in which he was held and close collaboration with private
and voluntary organizations, Nansen was able to expand the activities of his office and to
negotiate official international recognition of a travel document known as the ‗Nansen passport‘,
as well as measures in relation to the education and employment of refugees. Nansen was also
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involved in efforts on behalf of survivors of the Armenian genocide through the League‘s Rescue
Movement. On his death in 1930 the League of Nations created the Nansen International Office
for Refugees as an autonomous body, and the Office played a central role in the development of
a draft 1933 treaty on refugees‘ rights. These marked ‗the emergence of a regime‘ for the relief
and protection of refugees (Skran, 1995).
The same pattern of international organization and institution-building was evident elsewhere
during this period. In the field of health, to which the League of Nations also contributed
strongly, historians have identified the interwar period as marking ‗the transition from treaties
and conventions between nation states to the establishment of a brave new world of international
organizations, designed to promote health and welfare‘ (Weindling, 1995: 2). International
disease management, shaken by the influenza pandemic in which approximately 50m people
died worldwide (Taubenberger and Morens, 2006: 15), was overhauled during the 1926
International Sanitary Convention (Sealey, 2011). International coordination and
institutionalization of humanitarian practice continued through the creation of the League of Red
Cross Societies (LRCS) in 1919, the forerunner of the International Federation of the Red Cross
and Red Crescent (IFRC). There were also ideological variants: in 1922, the Communist
International created Workers International Relief (WIR) to channel relief donations for
international Communist parties and union organizations into the newly consolidated Soviet
Union. WIR was followed the next year by International Red Aid (MOPR, from the Russian
acronym), which established national chapters around Europe (Schilde, Hering and Walde, 2003;
Ryfman, 2008: 46–47).
The devastation of the First World War also prompted the birth of what would become ‗the first
recognizable trans-national humanitarian NGO‘ (Walker and Maxwell, 2009: 25), the Save the
Children Fund (SCF). SCF, formed in Britain in 1919, insisted that all children, including the
children of former enemies, were eligible for relief (Freeman, 1965). As more national SCF
sections were established in different countries, its leader Eglantyne Jebb oversaw the formation
of the International Save the Children Union in Geneva in 1920, with the British SCF and the
Swedish Rädda Barnen as its leading members. In the early1920s, the Save the Children Union
under Jebb‘s leadership developed a Declaration of the Rights of the Child, which the League
adopted in 1924.
Humanitarian efforts were also directed outside of Europe in this period. This reflected colonial
expansion, as well as the existence of conflict in East Asia, particularly China, and proto anti-
colonial conflicts such as the Rif War in Morocco (1921– 26). The assumptions of imperialism
and colonialism often influenced how humanitarian action was conceived, in the imperial
holdings in particular. This was exemplified by Karen Jeppe, a Danish relief worker and
missionary who worked amongst Armenians in the Ottoman Empire. Although officially
affiliated with Danish Protestant missionaries, Jeppe chose to work with the secular Danish
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Friends of Armenians (DA), and was eventually appointed League of Nations Commissioner for
the Protection of Women and Children in the Middle East (Bjornlund, 2008). If Jeppe, a colonial
missionary who worked with secular organizations and campaigned for Armenian self-
determination, embodied some of the contradictions inherent in imperial relief, similar tensions
could be seen in the work of NGOs such as SCF. This organization, while officially independent
of government and international in mindset, nonetheless perpetuated British imperial attitudes
and rule through its promotion of ‗enlightened relief‘ in the colonial world (Baughan, 2012).
By the mid-1930s, a series of political and geopolitical developments had had a significant
impact on the context of humanitarian operations. Economic depression had resulted in a
reduction of both the resources devoted to humanitarian action and the will for international
relief operations, although domestically speaking it encouraged more state welfare, particularly
in the United States with Theodore Roosevelt‘s New Deal. The rise of Nazism, Fascism and
Stalinism, exploiting economic inequality, nationalism and general popular discontent, increased
tensions and hostility in Europe and beyond. The League of Nations was unable to cope with the
intensifying aggression of the Axis powers, had little success in sanctioning its own members
and was greatly weakened by the withdrawal of Germany, Italy, Spain and Japan in the lead-up
to the Second World War. It operated on a skeleton structure during the war – the outbreak of
conflict standing as proof of the League‘s ineffectiveness – and held its final meeting in 1946.
This period was also a difficult one for the Red Cross/Red Crescent Movement. While the ICRC
successfully negotiated access to nominally civil conflicts, notably the Spanish Civil War (1936–
39) (see Bartels, 2009), it did not denounce the indiscriminate use of mustard gas by Italian
forces following Italy‘s invasion of Ethiopia in 1935, and notoriously failed to speak out against
Nazi atrocities. As Ian Smillie writes, ‗where the Holocaust is concerned, history and hindsight
have been hard on the Red Cross‘ (Smillie, 2012). Despite rounds of drafts and negotiations, the
International Conference had been unable to build consensus on the issue of protection of
civilians (Bugnion, 1994: 140–44). Because the pre-war Geneva Conventions did not cover
civilians subjected to brutality by their own governments, the ICRC had no mandate to intervene
on behalf of the Jews, gypsies, homosexuals, political prisoners and others who were being
gathered into the Third Reich‘s concentration and (later) extermination camps. Immediately after
the war, the ICRC was accused of having failed to denounce the camps and was also criticized
for doing nothing to mitigate the harsh punishment meted out to Soviet prisoners held by
Germany; the Soviet Union lobbied unsuccessfully for the ICRC to be dissolved and its functions
transferred to the LRCS (Bugnion, 2000: 43). In the 1980s the ICRC opened its archives to the
historian Jean-Claude Favez, whose work showed that the decision not to issue a public appeal
against abuses by the Third Reich was robustly debated within the ICRC, to the point that the
text of such an appeal was drafted before the decision against this option was taken in October
1942.
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Many of those involved in relief operations during the Second World War had also worked
during the First World War and in the interwar period, and were influenced by the New Deal‘s
practical programs as well as the wide-ranging research programs carried out by the League of
Nations and others. The desire to learn from past experience was conscious and explicit, and
affected the way humanitarian action was conceived by the Allies – the original ‗United Nations‘
– during and after the Second World War. It was applied to the work of the United Nations
Relief and Rehabilitation Administration (UNRRA), founded in 1943 with the objective of
providing aid, rehabilitation and resettlement assistance. For four years, before its closure in
1947, UNRRA was the world‘s preeminent humanitarian organization.
The UN itself was officially established at a conference in San Francisco in April 1945. Fifty
countries endorsed its 111-article Charter, which was ratified by the five Permanent Members of
the Security Council on 24 October 1945. These institutional developments were accompanied
by a series of normative changes, notably the Universal Declaration of Human Rights, with its
simple statement on the most basic of all human rights: ‗Everyone has the right to life, liberty
and security of person‘ (Article 3). Although there has been a tendency to see the Declaration as
a reaction to the Holocaust, it has also been placed in a broader perspective, both chronologically
and geographically, that favors its interpretation as ‗an amalgam of competing or converging
universalisms – imperial and anti-colonial, ―Eastern‖ and ―Western‖, ‗old and new‘ (Amril and
Sluga, 2008: 256; see for example Anderson, 2006; Carozza, 2003).
These post-war rights frameworks represented ‗the beginning of a period of unprecedented

international concern for the protection of human rights‘ (Clapham, 2007: 42). On 9 December
1948 – one day before the Universal Declaration was passed – the UN General Assembly
adopted the Convention on the Prevention and Punishment of the Crime of Genocide. In 1949
the four additional Geneva Conventions expanded and strengthened existing IHL. Among the
most significant additions was the extension of the law to include non-international armed
conflicts and the protection of civilian populations. Within the UN, institutional reforms
distributed UNRRA‘s assets and personnel between new specialized agencies: the United
Nations International Children‘s Emergency Fund (UNICEF), the Food and Agriculture
Organization, the World Health Organization and the International Refugee Organization (IRO,
replaced by UNHCR in 1951).
Other agencies were mandated to act in specific crises. One example was the United Nations
Korean Reconstruction Agency (UNKRA), which established a dedicated fund for South Korea
in light of the 1945 partition of the country and the Korean War (1950–53). UNKRA was built
upon – or subsumed into – a longer-standing US program of aid intended to stabilize and protect
South Korea from the communist North. The United States consistently spent over $200m a year
on aid to South Korea, with $380m going in the peak year of 1957 (Ekbladh, 2004: 18). UNKRA
was an example of what Kent (1987: 38) describes as ‗relief that was conceptually limited in
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terms of time, geography and approach‘ (it lasted only five years beyond the war, in operation
from 1950–58). It was also a good example of the intersection between official assistance and
strategic interest as Cold War tensions intensified: as Barnett puts it, ‗the willingness of states to
become more involved in the organization and delivery of relief owed not only to a newfound
passion for compassion but also to a belief that their political, economic, and strategic interests
were at stake‘ (Barnett, 2011: 107).
In contrast with the short-lived UNKRA, the UN Relief and Works Agency for Palestine
Refugees in the Near East (UNRWA), established in 1949 in response to the plight of Palestinian
refugees fleeing the newly-created state of Israel, is still in existence over 60 years after its
creation. Like UNKRA, UNRWA began as a special fund thanks to US momentum. Its work was
understood to fall into two phases: immediate relief to sustain refugees, and educational and
economic assistance to facilitate their integration into host countries (see Bocco, 2009). The
scale and duration of UNRWA‘s operations – with staff numbers in the tens of thousands,
responsible for approximately 4,700,000 registered refugees, dozens of camps and hundreds of
schools – have led to it being described as a surrogate state (Bocco, 2009: 234).
The post-war period also saw major developments in the structure and mechanisms of
international assistance, notably around food aid. In essence, international coordination and
regulation according to universal need gave way to a system driven by surplus production and
Cold War imperatives (see Jachertz and Nützenadel, 2011). The first herald of this was the
Marshall Plan (1947–51), through which the United States gave financial aid to help rebuild
European states (see Clay, 1995). By the late 1950s, American aid represented nearly one-third
of the total world wheat trade (Trentmann, 2006: 35). According to Frank Trentmann, ‗instead of
the New Internationalist vision of global coordination and of boosting local knowledge and
centers of production, the logic of food aid was to turn food producing developing countries into
importers of American wheat surpluses‘ (ibid.). In 1954 the United States introduced Public Law
(PL) 480 ‗Food for Peace‘, which enabled US food aid to be used for international development
and relief purposes. In the same year, FAO developed its ‗Principles of Surplus Disposal‘, an
agreed framework for the use of surplus agricultural production to support recovery and
development abroad (see Shaw, 2011). In 1961, US President John F. Kennedy established the
Food for Peace office and proposed the trialing of a multilateral mechanism for managing food
aid in emergencies and development contexts. Operating under FAO, the ‗World Food Program‘
trial was approved by the UN General Assembly in 1961.
3. Engagement in the global South during the Cold War

Humanitarian needs during the Cold War were perceived more explicitly through the lens of
global poverty and inequality. This was the period when the development discourse came to
prominence and leaders of less developed countries made the claim that the suffering caused by
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‗underdevelopment‘ was as great as relief and reconstruction needs in Europe, and as deserving
of international attention.
The immediate post-war years continued the expansion of humanitarian action that had occurred
during the Second World War. This pattern had already been seen, under different geopolitical
circumstances, following the First World War. After the Second World War, however, the
proliferation of agencies was especially striking: in addition to organizations established during
the war, nearly 200 NGOs were created between 1945 and 1949, most of them formed in the
United States (Barnett, 2011: 112). Meanwhile, the main beneficiaries of humanitarian action
shifted from being Europeans in need to all peoples in need, the world over. Of course, there
were some significant constraints: people living under communist rule in China, the Soviet
Union and Cuba were largely off-limits to international agencies more closely identified with the
Western (capitalist) ‗first world‘ than the Eastern (communist) ‗second world‘. It was the people
of the so-called ‗third world‘ that, in the post-colonial period, became the main focus of the
humanitarian system. The period when the image of starving African children came to dominate
Western conceptions of humanitarian aid, often disseminated by NGO fundraising campaigns,
coincided with the emergence of the third-world nations as a geopolitical bloc, asserting their
independence and equality for the first time.
The burgeoning humanitarian sector entered the 1950s with many elements recognizable in
today‘s system already in place, if not quite in their current shape: international governance
mechanisms, specialized agencies, NGOs, a language of rights, a legal framework, engagement
in conflicts, natural disasters, epidemiology, food and nutrition and a global ambition for what
was soon to be called ‗development‘. In 1948, the UN General Assembly passed Resolution 198
(III), calling for extra efforts for the ‗economic development of under-developed countries‘. In
1952, the UN published a report linking development to global stability, and ten years later, in
1961, the UN declared the first Decade of Development.
The process of decolonization structured the development agenda by creating a body of newly
independent nations that, for the first time, had clout on the global stage. The effects of
decolonization were strongly felt in the United Nations. In the first ten years after its formation,
the UN added 72 new states to its original membership. By 1955, of the 122 members 87 were
developing countries (or ‗less developed countries‘ as they were then known). Many of these
states participated in the Non-Aligned Movement (NAM), founded in 1961 to create a forum and
negotiating position for countries that did not identify with either of the two major superpower
blocs (see Willetts, 1978). The impact this had upon the workings of the UN, and in particular
the General Assembly, can be gauged from a highly-regarded account of the organization
published in 1979 by British politician Evan Luard. In his foreword, Luard outlined some of the
complaints being made against the UN, including the claim that ‗it has become little more than a
debating chamber, dominated by very small nations, where hotheads angrily abuse each other,
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and where nothing effective ever gets done‘ (Luard, 1979: vii). He went on to outline some of
the geopolitical changes that had impacted upon the UN:
the influx of new members, many of them very small, the role of great power diplomacy in
diminishing its role, the prevalence of internal rather than external conflict in the modern world,
the inadequate peace-keeping capacity, the disordered state of the finances, the poor morale of
international civil servants, the chronic political conflicts, once mainly between East and West
and now mainly between rich and poor.
The decolonization process also had a profound impact on the development of NGOs. The skills,
material and money wielded by Northern organizations were called upon to supplement those of
the newly established Southern governments, many of whom were struggling with inadequate
resources and infrastructure after the rapid withdrawal of the colonial powers. While official
international politics were constrained by the rivalry of the superpowers, ‗NGOs expanded as a
non-state or petty sovereign power within the liminal space between the West, the Soviet bloc
and independent Third World states emerging from colonization‘ (Duffield, 2007: 52). As a
result, the Cold War has often been regarded as a fertile period for humanitarian action by
private or voluntary groups: in 1960, Oxfam‘s annual budget went over the £1m mark for the
first time; by the end of the decade, 289 major new NGOs had been created (ibid.: 46; Kent,
1987: 46). Ties between these non-governmental agencies and the Cold War policies and
priorities of their home governments were often extremely close; in Vietnam, for instance,
Catholic Relief Services (CRS) was actively involved in delivering food aid to the US-allied
Popular Forces militia. The ‗thoroughgoing penetration of humanitarian activities by political
agendas‘ was typical of most NGOs, including CRS, CARE, International Voluntary Services
(IVS) and the Vietnam Christian Service (VCS) (Minear, 2012: 45–48).
Although the Cold War paradigm structured much of the environment in which aid actors had to
operate, not all situations conformed to the rigidity of the East–West division. One notable
example, with major significance for humanitarian action, was the Nigeria/Biafra Civil War.
Initially, the situation was treated as a civil conflict. The position of U Thant, the UN Secretary-
General, was that the Biafran secession in May 1967 represented an internal issue for the
Nigerian federal government – a position also advocated by Britain as the former colonial power.
A proposed airlift into Biafra (a predominantly Christian region) was opposed by the Nigerian
government, but as famine conditions intensified NGOs including Oxfam and CARE and a
coalition of Church agencies under Joint Church Aid began their own airlifts. Having made little
headway in its own negotiations, in August 1968 the ICRC announced its intention to begin
airlifting supplies into Biafra despite the lack of government authorization. The ICRC airlift
operated from September 1968 to June 1969, when an ICRC plane was shot down by a Nigerian
government fighter. Thereafter, Biafra was solely dependent on supplies carried at night by unlit
Joint Church Aid flights and NGO-chartered aircraft. Of the 7,800 flights into Biafra, 5,310 were
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operated by Joint Church Aid, which transported 66,000 tons of relief supplies (Stremlau, 1977:
244). For a time Uli airstrip in Biafra was the busiest airport in Africa, handling 50 or more
flights each night. It was this crisis that demonstrated the ability of NGOs to provide
humanitarian assistance in contexts where the UN and ICRC could not.
The Biafra war, all accounts agree, was of huge consequence: ‗a formative experience in
contemporary humanitarianism‘; ‗a test case and a turning point for international humanitarian
assistance‘; ‗opening a new chapter in humanitarian action‘; ‗everyone is in agreement that
modern humanitarian action was born in Biafra‘ (De Waal, 1997: 72; Macalister-Smith, 1985:
118; Barnett, 2011: 133; Maillard, 2008). It was crucial in the formation of at least two NGOs:
Concern and Médecins Sans Frontières (MSF). Concern (now Concern Worldwide) was formed
in Ireland by Aengus Finucane. Finucane, the Catholic parish priest at Uli, had been deeply
involved in managing the arrival of supplies at the airstrip. MSF was formed in 1971 with
témoignage (‗bearing witness‘) as a core principle, in opposition to the ICRC‘s traditional
discretion (Vallaeys, 2004; Maillard, 2008; Desgrandchamps, 2011–12). It is also now accepted
that the humanitarian effort was co-opted by the Biafran leadership in their campaign for
international recognition, and provided resources for their war effort. Smillie (1995: 104)
concludes that the relief effort was ‗an act of unfortunate and profound folly‘ that prolonged the
war and contributed to the deaths of thousands of people.
The East Pakistan crisis, if less symbolic now than Biafra, presented another major challenge to
the humanitarian system. In November 1970, a severe cyclone and storm surge hit the coastal
areas of the Ganges delta in what was then East Pakistan, killing an estimated 300,000 people.
The cyclone interrupted planned national elections, polls for which were held in December and
January. The government‘s refusal to acknowledge the resounding success of the Bangladeshi
nationalist Awami League led to widespread uprisings in East Pakistan, which were in turn
repressed by West Pakistani forces. The perception that the authorities in West Pakistan had been
slow to respond to the cyclone exacerbated tensions between the two halves of the country, with
massacres of civilians by Pakistani authorities fuelling Bengali resistance, leading to a bitter civil
war from March to December 1971. By the end of the year, an estimated 10m refugees from East
Pakistan had sought safety across the border in India. Of these, approximately 7m were living in
825 camps, while the remainders were given shelter by friends and family (Loescher, 2001a:
156).
The scale of the refugee crisis encouraged U Thant to nominate UNHCR as the ‗Focal Point‘ for
the coordination of all UN assistance. At the time, this was an innovative approach, giving the
High Commissioner powers distinct from those of his role as head of UNHCR, and can be seen
as a kind of precursor to the post-2005 cluster system. Even so, relief efforts inside Bangladesh,
the new name for East Pakistan as declared by the Awami League in March 1971, were
hampered by conflict and a lack of independence from Pakistani officials and the military. A
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contemporary study concluded that ‗In retrospect, no relief at all might have been better‘ (Chen
and Northrup, 1973: 272).
Beyond conflict response, understandings of humanitarian action evolved rapidly in the 1970s.
One crucial area of action was in African food crises, especially when famine struck seven
countries in the Sahel region (Chad, Gambia, Mali, Mauritania, Niger, Senegal and Upper
Volta/Burkina Faso) more or less at the same time as it took hold in Ethiopia. Like other
humanitarian mobilizations of the period, the response to these food crises revealed the poor
coordination of the growing humanitarian system and its difficult relationship with affected
governments. These experiences led to the establishment of the FAO‘s Global Information and
Early Warning System for Food and Agriculture in 1973. The following year the UN held a
World Food Conference, which affirmed the importance of planning for food crises and
cemented WFP‘s position of leadership in this field (Shaw, 2011: 56). Meanwhile, Amartya
Sen‘s ‗entitlement theory‘, which proposed that famine was caused not by an outright shortage of
food but by the inability of certain population groups to procure or access food (Sen, 1981),
prompted more sustained analysis of the ways that affected populations responded to food
shortages, and how these responses might be read as signs of an impending food security crisis.
The 1980s saw another series of major crises, often involving protracted displacement and
characterized by heavy media attention and the manipulation or ‗instrumentalization‘ of aid,
whether by affected governments, armed groups or Western states (see Terry, 2002; Donini,
2012). One of the most glaring examples was the system of refugee camps in Honduras,
effectively host to both left-wing and right-wing movements from Central America and subject
to significant US intervention. Instrumentalization was also a major issue along the Thai–
Cambodian border, where some 200,000 refugees massed following the toppling of the genocidal
Khmer Rouge regime by the Vietnamese. It became clear that the camps were being used as a
sanctuary by the Khmer Rouge to sustain their military campaign against the Vietnamese-backed
regime in Phnom Penh (Terry, 2002: 114–54). During the Ethiopian famine of 1984–85, the
humanitarian operation was manipulated by the Ethiopian government, which used the food aid
as part of a large program of population resettlement from conflict-affected areas to less densely
populated regions in the south of the country (see Clay, 1989). This crisis became perhaps the
defining example of a media-driven humanitarian mobilization, with massive sums raised
through charity sales of records by Band Aid and internationally televised Live Aid concerts (see
Vaux, 2001: 43–68).
Another major international mobilization took place following the Soviet invasion of
Afghanistan in 1979. The conflict resulted in major flows of refugees into neighboring countries.
It was estimated that 3.5m Afghan refugees had sought refuge in Pakistan alone by the end of the
decade (Loescher, 2001a: 62). Hundreds of refugee camps were established by the Pakistani
government and UNHCR, many of which were militarized by the mujahedeen groups fighting
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Soviet occupation. In addition to billions of dollars in direct military support, Cold War tensions
encouraged Western governments to support these groups indirectly through refugee networks,
while for newly formed Islamic relief organizations the war represented a first terrain of
transnational operations (Juul Petersen, 2011: 95–98). When the Soviet Union withdrew from
Afghanistan in 1989, funding for refugees in neighboring countries declined significantly,
despite a civil war resulting in new waves of displacement and humanitarian needs.
4. From the fall of the Iron Curtain to the close of the century
From the mid-1980s, signs of strain within the Soviet bloc were beginning to show. The power
of the Solidarity trade union movement in Poland was one such sign, the fall of the Berlin Wall
in November 1989 another. By the end of 1991 the Soviet Republics and finally Russia itself had
declared independence. The Union of Soviet Socialist Republics had ceased to exist. Initially,
humanitarian action seemed to benefit from the easing of superpower tensions. Following a
devastating earthquake in Soviet Armenia in early December 1988, for example, the Soviet
government opened its borders to Western humanitarian workers for the first time since the
famine of the 1920s. Another example of humanitarian cooperation in this period was Operation
Lifeline Sudan (OLS), established in April 1989. OLS was based on the establishment of
‗corridors of tranquility‘ through which aid could be delivered after negotiations with the
government and the Sudan People‘s Liberation Movement/Army (SPLM/A). ‗At the time,‘
Richard Barltrop writes (2011), ‗the creation of OLS was a new and significant step, both for the
UN and the SPLM/ A. The UN had never before dealt directly with what would previously have
been considered only a rebel movement, fighting against a sovereign African state.‘
Hopes that the end of the Cold War would lead to a more satisfactory international environment
proved short lived. While the likelihood of a recurrence of the great set piece battles that marked
the two world wars receded, this did not mean that the ‗age of wars‘ was at an end: ‗the years
after 1989 saw more military operations in more parts of Europe, Asia and Africa than anyone
could remember, though not all of them were officially classified as wars: in Liberia, Angola, the
Sudan and the Horn of Africa, in ex-Yugoslavia, in Moldova, in several countries of the
Caucasus and Transcaucasus, in the ever-explosive Middle East, in ex-Soviet Central Asia and
Afghanistan‘ (Hobsbawm, 1994: 560). In 1993 there were 47 active conflicts, of which 43 were
civil wars (MSF, 1997: 7). These conflicts became known as ‗new wars‘ – not because
everything about them was so very new, but because of their frequency and the intensification of
certain key features, including attacks on civilians, a breakdown of public authority or state
legitimacy and their containment within a country‘s borders (see Newman, 2004).
For humanitarian actors, ‗the race to find ... early indicators of emergent conflict [was] to the
1990s what the race for the magic formula of famine early warning indicators was to the 1970s
and 1980s‘ (Slim, 1995: 114). They came to refer to the situations they confronted as ‗complex
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emergencies‘. This term may have been coined in Mozambique, where the UN was negotiating
simultaneously with the government and with non-state actors, in this case the RENAMO
movement, to allow the provision of assistance outside of its standard country agreements
(Calhoun, 2008: 84). The central idea of the complex emergency, it has been argued, is that
‗some emergencies have multiple causes, involve multiple local actors, and compel an
international response‘ (ibid.). The idea of a system-wide response is therefore integral to their
conception. Mark Duffield (1994: 3), writing when the term was only a few years old, provided a
more assertive definition:
So-called complex emergencies are essentially political in nature: they are protracted political
crises resulting from sectarian or predatory indigenous responses to socioeconomic stress and
marginalization. Unlike natural disasters, complex emergencies have a singular ability to erode
or destroy the cultural, civil, political and economic integrity of established societies.
Facing such crises, with greater collaboration possible following the end of the Cold War, in the
1990s the members of the Security Council showed a greater willingness to authorize military
operations to halt or prevent the widespread suffering or death of civilians without the consent of
the government concerned. Analysts at the time discerned that ‗a new rule is emerging: There are
circumstances in which the world community can, in defense of our common humanity, interfere
in the national affairs of a sovereign nation state‘ (Soguk, 1999: 183; see also Wheeler, 2000:
289).
From 1948–88, the UN undertook only five peacekeeping missions; from 1989–94 it authorized
20 missions and increased the number of peacekeepers from 11,000 to 75,000. The UN also
reformed its humanitarian apparatus. Following a review of capacity and coordination
arrangements, on 19 December 1991 the General Assembly passed Resolution 46/182 on the
‗Strengthening of the coordination of humanitarian emergency assistance of the United Nations‘.
In addition to reinforcing the Office of the UN Disaster Relief Coordinator (UNDRO), which
became the Department of Humanitarian Affairs (DHA), the resolution placed the following key
elements into a new architecture: the post of Emergency Relief Coordinator; the Humanitarian
Coordinator system; the Inter-Agency Standing Committee (IASC); inter-agency needs
assessments; the Consolidated Appeals Process (CAP); the Central Emergency Revolving Fund
(CERF); and the Financial Tracking System (FTS).
The resolution also made possible greater UN involvement in internal conflicts (Tsui and Myint-
U, 2004). In so doing, it built upon Resolution 43/131 of 8 December 1988, passed in the
aftermath of the Armenian earthquake, which affirmed the principle of access to victims (see
Bettati, 1994). The 1990s also saw a large growth in the number and reach of humanitarian
actors on multiple levels. NGOs became even more important players. This shift shows up in
funding statistics: in 1976 no European Community (EC) emergency aid funding went through
NGOs; by 1982–83 they were receiving 40% (Borton, 1993: 191). States also became more
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involved in relief, and agencies shifted their focus more towards relief and away from
development assistance: WFP, for instance, cut its development projects from over half of its
activity in 1989–90 to less than one-sixth by 2000 (Clay, 2003: 701).
The 1990s also witnessed a number of major crises and conflicts which contributed directly to
significant changes in the humanitarian world, including the 1991 intervention in Iraq, authorized
by the UN in the name of Kurds who had suffered repression at the hands of the Iraqi
government; the conflict in the former Yugoslavia; civil war and famine in Somalia; and the
Rwandan genocide and Great Lakes crisis (Walker and Maxwell, 2009: 60). Events in Somalia in
particular have cast a long shadow over humanitarian action. Following the overthrow of
President Siad Barre in 1991, factional militia warfare and famine resulting from the loss of food
production, a UN peacekeeping force to protect aid convoys was approved in April 1992. After
two ramped-up UN deployments and the death of 24 Pakistani UN troops in June 1993, US
forces launched an attack on the militia of the Somali National Alliance, losing 18 soldiers and
two Blackhawk helicopters in the process. Gruesome footage of the body of a US soldier being
dragged through the streets of Mogadishu by cheering Somalis had a traumatic effect on US
public opinion: all US troops were withdrawn from Somalia by March 1994. ‗The impact of this
debacle,‘ it has been claimed, ‗is difficult to over-estimate‘ (Walker and Maxwell, 2009: 66).
Experiences in Somalia had a direct effect on the international response to the Yugoslav conflict.
As Yugoslavia splintered apart after 1991, a brutal policy of ‗ethnic cleansing‘ was practiced by
Croatian and especially Serbian nationalists, with the population of Bosnia the principal victims.
By 1993, the cost of aid to the Balkans was more than $1m per day, with UNHCR assisting 2.7m
people inside Bosnia as well as 1.4m in other parts of the former Yugoslavia (Rieff, 2002: 136).
‗Humanitarian action was the ―filler‖ that was used to plug the policy gaps caused by the
inability of the major powers to agree on political solutions to a profoundly political problem‘
(Kent, 2004: 856). Emblematically, the peacekeeping mission (UNPROFOR) was referred to by
Bosnians as the UN ‗Self-Protection Force‘. UNPROFOR‘s inability to provide meaningful
protection for civilians was graphically demonstrated in July 1995, when a UN-designated ‗safe
area‘ in Srebrenica fell to Serb forces. The ensuing massacre of 8,000 men and boys prompted
the US and other Western governments to order air strikes on Serb positions in August 1995.
The impact of Somalia upon the international community was again starkly apparent as tensions
rose in Rwanda. On 6 April 1994 – barely a month after the US withdrawal from Somalia– a
genocide orchestrated by extremists within the majority Hutu ethnic group against the minority
Tutsi ethnic group and politically moderate Hutus began. The genocide had been preceded by
decades of tension between the two groups that had generated previous atrocities, the mass flight
or expulsion of many Tutsis in 1959 to neighboring countries and, starting in 1990, conflict as
the Tutsi-led Rwandan Patriotic Front (RPF) tried to fight its way back into Rwanda after 40
years of exile in Uganda. By July, an estimated 800,000 people had been killed by Hutu
extremists and members of the Rwandan Armed Forces (FAR), assisted by ‗ordinary‘ Hutus
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incited to kill their neighbors. A multinational UN peacekeeping force, the UN Assistance

Mission to Rwanda (UNAMIR), had been
deployed in October 1993 to help with the implementation of a power-sharing agreement.

However, most of the UNAMIR force was withdrawn by the troop contributing nations shortly
after the killing of ten Belgian peacekeepers on 7 April. Even when it became clear that a
genocide directed against Tutsis and moderate Hutus was underway, there was reluctance within
the UN Security Council to characterize the massacres as genocide in order to avoid invoking the
obligation to intervene, as required by the 1948 Genocide Convention. With no international
willingness to act decisively, the genocide against Tutsis and moderate Hutus was only brought
to an end by the victory of the RPF in July 1994 and the mass movement of 1.8m Hutus into
refugee camps in eastern Zaire.
By the end of 1994, there were over 2m refugees in the countries neighboring Rwanda, and
roughly 1.5m displaced internally; over half of the country‘s 7m-strong population had been
directly affected by the crisis (UNHCR, 2000: 246). Humanitarian agencies working in camps in
Goma, in Zaire close to the border, were poorly prepared and overwhelmed by the scale of
needs, and an estimated 30,000 refugees died of cholera in Goma alone (Stockton, 1998: 352;
Borton et al., 1996). Residents of the camps became ‗more like hostages than refugees‘ as the
FAR and Interahamwe militia used the camps as a recruiting ground, source of income and base
for night raids into Rwanda (UNHCR, 2000: 258; see Terry, 2002). Military assaults by
Rwandan-backed militia on the refugee camps in late 1996 and 1997 forced many refugees back
into Rwanda, whilst others were pursued deep into Congo where they were killed or perished.
Experiences in the Great Lakes galvanized a spate of initiatives to improve accountability and
standards. A group of bilateral donor organizations led the Joint Evaluation of Emergency
Assistance to Rwanda, the first comprehensive evaluation of collective emergency operations,
ground breaking for its system-wide approach (Dabelstein, 1996: 287–88; see Eriksson et al.,
1996). One of the most important of the subsequent initiatives was the Sphere Project, which in
May 1998 resulted in a draft Handbook of Minimum Standards and a Humanitarian Charter. As
Margie Buchanan-Smith wrote, although concerns about operations and principles in the early
1990s ‗created an atmosphere conducive to the Sphere project, it was the scale and intensity of
the humanitarian crisis in Rwanda in 1994 which determined the vigor, depth and direction of its
study‘ (Buchanan-Smith, 2003: vi; see also Walker and Purdin, 2004). The Code of Conduct for
the International Red Cross and Red Crescent Movement and Non-Governmental Organizations,
launched in 1994, predated these initiatives, but was nonetheless galvanized by the attention to
beneficiary accountability in the years after Rwanda (see Walker, 2005). The Great Lakes crisis
thus directly and fundamentally shaped the conduct of humanitarian practitioners today.
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It also had a powerful effect on the normative frameworks associated with, although not directly
responsible for, humanitarian action. Several precepts of international humanitarian action,
including the droitd‘ingérence advocated by members of the French sans-frontiériste (‗without
borders‘) movement, presented a challenge to the Westphalian principle of state sovereignty. In
the field of humanitarian intervention, NATO intervention in Kosovo in 1999 and the
‗Responsibility to Protect‘ outlined by the International Commission on Intervention and State
Sovereignty (ICISS) remain highly contested and controversial (see Weiss, 2007). The
establishment of the International Criminal Court (ICC) in 2002, along with the international
tribunals and special courts for the former Yugoslavia, Rwanda, Sierra Leone, Timor-Leste,
Cambodia and Lebanon, is another expression of the principle of international engagement
around human rights abuses against civilians.
Although protection of civilians (POC) had long been a concern of specialists in international
law, human rights and refugee law, the experiences of Somalia, Bosnia and Rwanda brought the
protection agenda into the work of a much larger number of actors. While recognizing that much
protection work, like relief assistance, is accomplished by affected communities themselves,
Elizabeth Ferris (2011) outlines three strands of modern protection work in the international
humanitarian domain. The earliest legal work of the ICRC – the first Geneva Convention, in
1864 – involved the protection of combatants; since then, the remit of the ICRC and IHL has
expanded to include protection of prisoners of war and POC.
In tandem, refugee crises starting with the wars in Europe, the creation of UNHCR and the later
recognition of the needs of internally displaced people (IDPs) gave rise to protection
mechanisms for displaced people. The expanding human rights movement contributed to this
process by addressing the protection of ethnic and racial minorities, children, women and gay
and lesbian people through declarations of rights, UN resolutions and other forums. As a sign of
the increasing adoption of protection work, all but one of the 11 international peacekeeping
missions begun from 2001–11 included POC in their mandates (ibid.: 2).
During the twentieth century, global relationships between states provided a changing framework
for the practice of international humanitarian action. The two world wars devastated Europe and
contributed to the consolidation of the United States‘ position as an international power.
Colonization, which began decades before, arguably peaked during the interwar period, and
became the subject of inter-governmental management with the League of Nations mandate
system. After the Second World War, humanitarian action expanded into what was then called
the ‗third world‘, a label that reflected the process of decolonization and the emergence of the
former colonies and developing nations as a political bloc. Since the late Cold War, and
especially since the decline of the ‗second world‘ – the communist bloc – with the fall of the
Soviet Union, the same group of countries has been designated the ‗global South‘. Although the
relevance of this classification has been challenged by the rapid development of certain Southern
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nations and the complex fallout from the events of 9/11, the global South remains one of the
defining terrains for humanitarian action in the twenty-first century
Chapter Five:
Actors in Humanitarian Assistance
1. The UN System
United Nations Office for the Coordination of Humanitarian Affairs (OCHA)
Part of the United Nations offices, OCHA is one of the principal agencies within the
humanitarian sector. They work as a platform for other organizations to liaise and set out basic
standards for humanitarian aid. Additionally, OCHA responds during emergencies and deploys
their teams when necessary.
The Office for the Coordination of Humanitarian Affairs (OCHA) of the UN Secretariat is
responsible for coordinating responses to emergencies. It does this through the Inter-Agency
Standing Committee, whose members include the UN system entities most responsible for
providing emergency relief. The IASC is a unique inter-agency forum for coordination, policy
development and decision-making involving the key UN and non-UN humanitarian partners. The
IASC develops humanitarian policies, agrees on a clear division of responsibility for the various
aspects of humanitarian assistance, identifies and addresses gaps in response, and advocates for
effective application of humanitarian principles. With the Executive Committee for
Humanitarian Affairs (ECHA), the IASC forms the key strategic coordination mechanism among
major humanitarian actors. A coordinated, system-wide approach to humanitarian relief is
essential in providing assistance quickly and efficiently to those in need.
The UN Central Emergency Response Fund (CERF), managed by OCHA, is one of the fastest
and most effective ways to support rapid humanitarian response for people affected by natural
disasters and armed conflict. CERF receives voluntary contributions year-round to provide
immediate funding for life-saving humanitarian action anywhere in the world.
What key UN entities deliver humanitarian aid?

Four UN entities, the United Nations Development Program (UNDP), the United Nations
Refugee Agency (UNHCR), the United Nations Children's Fund (UNICEF) and the World Food
Program (WFP) have primary roles in the delivery of relief assistance. UNDP is the agency
responsible for operational activities for natural disaster mitigation, prevention and preparedness.
When emergencies occur, UNDP Resident Coordinators coordinate relief and rehabilitation
efforts at the national level.
Helping Refugees
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The UN Refugee Agency (UNHCR) emerged in the wake of World War II to help Europeans
displaced by that conflict. The agency leads and co-ordinates international action to protect
refugees and resolve refugee problems worldwide. The General Assembly created the United
Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) to provide
emergency relief to some 750,000 Palestine refugees, who had lost their homes and livelihoods
as a result of the 1948 Arab-Israeli conflict. Today, some 5 million Palestine refugees are eligible
for UNRWA services. The Office of the United Nations High Commissioner for Refugees is
mandated to lead and co-ordinate international action to protect refugees and resolve refugee
problems worldwide. Its primary purpose is to safeguard the rights and well-being of refugees. It
strives to ensure that everyone can exercise the right to seek asylum and find safe refuge in
another State, with the option to return home voluntarily, integrate locally or to resettle in a third
country. It also has a mandate to help stateless people.
Helping Children
Since its beginning, The United Nations Children's Fund (UNICEF) has strived to reach as many
children as possible with effective, low-cost solutions to counter the biggest threats to their
survival. UNICEF also consistently urges governments and warring parties to act more
effectively to protect children.
Feeding the Hungry

The World Food Program (WFP) provides relief to millions of people, who are victims of
disasters. It is responsible for mobilizing food and funds for transport for all large-scale refugee-
feeding operations managed by UNHCR. The Food and Agriculture Organization of the United
Nations (FAO) is often called on to help farmers re-establish production following floods,
outbreaks of livestock disease and similar emergencies. The FAO Global Information and Early
Warning System issues monthly reports on the world food situation. Special alerts identify, for
Governments and relief organizations, countries threatened by food shortages.
Healing the Sick

The World Health Organization (WHO) coordinates the international response to humanitarian
health emergencies. WHO is responsible for providing leadership on global health matters,
shaping the health research agenda, setting norms and standards, articulating evidence-based
policy options, providing technical support to countries and monitoring and assessing health
trends. In the 21st century, health is a shared responsibility, involving equitable access to
essential care and collective defense against transnational threats.
A. International NGOs International Federation of Red Cross and Red Crescent Societies
(IFRC)
Present in 192 countries, the IFRC is one of the largest and oldest humanitarian organizations in
the world. National Societies in each country comprise the Federation. They actively respond to
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disasters when they happen. Additionally, the organization works to build resilience in
communities prior to when disaster strikes. In recognition of 100 years since Henri Dunant
founded the Red Cross, both the International Committee of Red Cross and what is today known
as the International Federation of Red Cross and Red Crescent Societies were awarded the Nobel
Peace Prize.
International Committee of Red Cross Red Crescent (ICRC)

Part of the Red Cross Red Crescent Movement, the ICRC is a sister organization of the IFRC.
Rather than responding to disaster emergencies, however, ICRC works in conflict-affected areas.
This includes protecting victims of conflict, as well as working in prisons and with victims of
torture. Today it is the largest humanitarian organization in the world. In their auxiliary role,
National Red Cross and Red Crescent Societies provide emergency relief in armed conflict,
natural disasters, and other emergencies. They also play a key role in disseminating International
Humanitarian Law and humanitarian principles. Local actors, like National Red Cross and Red
Crescent Societies, ultimately drive the effectiveness and quality of humanitarian responses.
They have the local knowledge, relationships and access that enable them to be fast,
impactful and cost-effective responders before, during and after crises hit. They are often in the
strongest position to save lives and promote dignity.
When a disaster overwhelms local capacities, and upon request from the host National Society,
the International Federation of Red Cross and Red Crescent Societies (IFRC) – often pool their
assets and resources to support the national response. By leveraging the complementary roles and
strengths of local, national and international humanitarian actors, the Red Cross Red Crescent
extends the reach and effectiveness of its collective action.
Oxfam International
Working in more than 90 countries, Oxfam is a confederation with 20 organizations. One of their
lines of work focuses on poverty and development. At the same time, they respond when disaster
strikes. Currently, they are providing support in different conflict or natural disaster situations.
Doctors Without Borders (MSF)

Doctors Without Borders originated in France, which is why their acronym stands for Médecins
Sans Frontières (MSF). The organization delivers medical aid in case of emergencies. MSF is
also known for their strong focus on advocacy and condemning crimes against humanity
publicly.
Cooperation for Assistance and Relief Everywhere (CARE)

Working in 94 countries, CARE focuses on international development and delivering aid during
emergencies. Currently, they have more than 1000 projects in operation. Their focus is on
women and girls when it comes to development projects. In humanitarian aid, CARE works
closely with local partners to ensure effective aid delivery.
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International Rescue Committee

IRC responds to the world‘s worst humanitarian crises and helps people to survive and rebuild
their lives. It is at work in over 40 countries.
ALNAP
ALNAP (Active Learning Network for Accountability and Performance) is a sector-wide
network in the international humanitarian system made up of key international humanitarian
organizations and experts. Established in 1997 following the multi-agency evaluation of the
humanitarian response to the Rwandan Genocide, ALNAP provides the humanitarian sector with
a forum to address issues of accountability and learning, as well as producing research and
analysis of shared challenges facing the humanitarian sector.
Members
ALNAP full members include agencies and individuals from five key constituencies that make
up the international humanitarian sector:
Donors- AECID; AusAID; Canadian International Development Agency; DANIDA; DFID;
European Community Humanitarian Aid Office; Irish Aid; JICA; Ministry of Foreign Affairs,
Germany; Ministry of Foreign Affairs, Netherlands; NZAID; Norwegian Agency for
Development Cooperation; Swedish International Development Cooperation Agency; Swiss
Agency for Development and Cooperation; USAID
UN agencies- FAO; OCHA; UNICEF; UNDP; UNHCR; WHO; WFP
Red Cross and Red Crescent movement- British Red Cross; ICRC; IFRC
International and national NGOs- Action Against Hunger; Africa Humanitarian Action; All India
Disaster Mitigation Institute; CAFOD; CARE (relief agency); Catholic Relief Services; Christian
Aid; DARA (international organization); Danish Refugee Council; Disasters Emergency
Committee; Focus Humanitarian Assistance; Global Hand; Humanitarian Accountability
Partnership; ICVA; International Rescue Committee; Mercy Malaysia; MSF-Holland;
Norwegian
Refugee Council; OFADEC; Oxfam; People In Aid; RedR; Save the Children; Sphere Project;
Steering Committee for Humanitarian Response; Tearfund; Voice; World Vision
Academic establishments, research institutions and independent consultants- DARA; Glemminge
Development Research AB; Groupe URD; ; IECAH; Humanitarian Futures Programme; Oxford
Brookes University; Overseas Development Institute ; Tufts University
ALNAP Observer Members are individuals with a keen interest in humanitarian performance
issues, who wish to keep up to date with ALNAP's activities and events.
Areas of Activity and Resources

The State of the Humanitarian System, Humanitarian leadership, Humanitarian Evaluation , The
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quality and use of evidence in humanitarian action, Effective humanitarian feedback

mechanisms, Urban response, and Syria Evaluation Portal for Coordinated Accountability and
Lessons Learning (CALL)
Chapter Six:
International Law and Humanitarian Assistance
I. Interface Between Humanitarian Issues and Human Rights

Three ways that humanitarianism links with human rights:
1. Caring for humanity

The central theme of humanitarianism and human rights protections is to preserve dignity and
humanity. Both are applied indiscriminately and are based on equal treatment. For example in
2015, the United Nations Office of the Coordination of Humanitarian Affairs (OCHA) helped
13.5 million Syrians who were displaced because of conflict. It helped with their safe transport
out of the country where they faced persecution and by advocating for their protection.
Humanitarian assistance happens in the UK as well; the British Red Cross helped 15,914 people
in the UK because of flooding, fires, and power cuts, by providing warm beds and fresh clothes.
2. A truly neutral approach

There are some important differences between humanitarianism and human rights protections.
The human rights agenda is concerned with justice and bringing perpetrators of abuse to justice.
The humanitarian agenda is less concerned with justice. Their intention is to take care of the sick
and wounded, rather than to identify injustice. Over the last couple of decades, however, there
has been a shift with humanitarian organizations advocating from a rights-based perspective. A
main drive for this shift is the realization that to alleviate future human suffering, root causes
have to be identified.
3. Human rights in armed conflict

At the time that the ICRC was created, the Geneva Conventions were drafted, initiated by Henry
Dunant. These conventions, along with other international treaties, make up International
Humanitarian Law (IHL). IHL is the law that regulates armed conflict, and it works to
complement international human rights law during these times. Specifically, IHL protects
civilians and those that are no longer taking part in the conflict, like wounded soldiers. It also
sets out limits to weaponry, like the banned use of chemical weapons. Both IHL and human
rights legal frameworks are concerned with protecting human dignity and making conflict as
humane as possible.
II. International Humanitarian Law: History and Development

International humanitarian law forms a major part of public international law and comprises the
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rules which, in times of armed conflict, seek to protect people who are not or are no longer
takingpart in the hostilities, and to restrict the methods and means of warfare employed.
International humanitarian law applicable in armed conflicts is international treaty or customary
rules which are specially intended to resolve matters of humanitarian concern arising directly
from armed conflicts, whether of an international or non-international nature; for humanitarian
reasons those rules restrict the right of the parties to a conflict to use the methods and means of
warfare of their choice, and protect people and property affected or liable to be affected by the
conflict.
Geneva and The Hague

International humanitarian law (IHL) – also known as the law of armed conflicts or law of war
has two branches:
• the ―law of Geneva‖, which is designed to safeguard military personnel who are no longer
taking part in the fighting and people not actively involved in hostilities, i.e. civilians;
• the ―law of The Hague‖, which establishes the rights and obligations of belligerents in the
conduct of military operations, and limits the means of harming the enemy. The two branches of
IHL draw their names from the cities where each was initially codified. With the adoption of the
Additional
Protocols of 1977, which combine both branches, that distinction is now of merely historical and
didactic value.
An international armed conflict means fighting between the armed forces of at least two States (it
should be noted that wars of national liberation have been classified as international armed
conflicts). A non-international armed conflict means fighting on the territory of a State between
the regular armed forces and identifiable armed groups, or between armed groups fighting one
another. To be considered a non-international armed conflict, fighting must reach a certain level
of intensity and extend over a certain period of time. Internal disturbances are characterized by a
serious disruption of internal order resulting from acts of violence which nevertheless are not
representative of an armed conflict (riots, struggles between factions or against the authorities,
for example).
The parties to a conflict must at all times distinguish between the civilian population and
combatants in order to spare the civilian population and civilian property. Neither the civilian
population as a whole nor individual civilian may be attacked. Attacks may be made solely
against military objectives. People who do not or can no longer take part in the hostilities are
entitled to respect for their lives and for their physical and mental integrity. Such people must in
all circumstances be protected and treated with humanity, without any unfavorable distinction
whatever. It is forbidden to kill or wound an adversary who surrenders or who can no longer take
part in the fighting. Neither the parties to the conflict nor members of their armed forces have an
unlimited right to choose methods and means of warfare. It is forbidden to use weapons or
methods of warfare that are likely to cause unnecessary losses or excessive suffering.
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The wounded and sick must be collected and cared for by the party to the conflict which has
them in its power. Medical personnel and medical establishments, transports and equipment must
be spared. The red cross or red crescent on a white background is the distinctive sign indicating
that such persons and objects must be respected. Captured combatants and civilians who find
themselves under the authority of the adverse party are entitled to respect for their lives, their
dignity, their personal rights and their political, religious and other convictions. They must be
protected against all acts of violence or reprisal. They are entitled to exchange news with their
families and receive aid. They must enjoy basic judicial guarantees.
Prior to the advent of contemporary humanitarian law

First there were unwritten rules based on customs that regulated armed conflicts. Then bilateral
treaties (cartels) drafted in varying degrees of detail gradually came into force. The belligerents
sometimes ratified them after the fighting was over. There were also regulations which States
issued to their troops like the Lieber Code. The law then applicable in armed conflicts was thus
limited in both time and space in that it was valid for only one battle or specific conflict. The
rules also varied depending on the period, place, morals and civilization.
Who were the precursors of contemporary humanitarian law?

Two men played an essential role in its creation: Henry Dunant and Guillaume- Henri Dufour.
Dunant formulated the idea in A Memory of Solferino, published in 1862. On the strength of his
own experience of war, General Dufour lost no time in lending his active moral support, notably
by chairing the 1864 Diplomatic Conference.
How did the idea become a reality?

The Swiss government, at the prompting of the five founding members of the ICRC, convened
the 1864 Diplomatic Conference, which was attended by 16 States who adopted the Geneva
Convention for the amelioration of the condition of the wounded in armies in the field.
What innovations did that Convention bring about?

The 1864 Geneva Convention laid the foundations for contemporary humanitarian law. It was
chiefly characterized by:
• standing written rules of universal scope to protect the victims of conflicts;
• its multilateral nature, open to all States;
• the obligation to extend care without discrimination to wounded and sick military personnel;
• respect for and marking of medical personnel, transports and equipment using an emblem (red
cross on a white background).
Initiated in the form of the first Geneva Convention of 1864, contemporary humanitarian law has
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evolved in stages, all too often after the events for which they were sorely needed, to meet the
ever growing need for humanitarian aid resulting from developments in weaponry and new types
of conflict. The following are the main treaties in chronological order of adoption:
1864 Geneva Convention for the amelioration of the condition of the wounded in armies in the
field 1868 Declaration of St. Petersburg (prohibiting the use of certain projectiles in wartime)
1899 The Hague Conventions respecting the laws and customs of war on land and the adaptation
to maritime warfare of the principles of the 1864 Geneva Convention
1906 Review and development of the 1864 Geneva Convention
1907 Review of The Hague Conventions of 1899 and adoption of new Conventions
1925 Geneva Protocol for the prohibition of the use in war of asphyxiating, poisonous or other
gases and of bacteriological methods of warfare
1929 Two Geneva Conventions:
• Review and development of the 1906 Geneva Convention
• Geneva Convention relating to the treatment of prisoners of war (new)
1949 Four Geneva Conventions:
I Amelioration of the condition of the wounded and sick in armed forces in the field
II Amelioration of the condition of wounded, sick and shipwrecked members of armed forces at
sea
III Treatment of prisoners of war
IV Protection of civilian persons in time of war (new)
1954 The Hague Convention for the protection of cultural property in the event of armed conflict
1972 Convention on the prohibition of the development, production and stockpiling of
bacteriological (biological) and toxic weapons and on their destruction
1977 Two Protocols additional to the four 1949 Geneva Conventions, which strengthen the
protection of victims of international (Protocol I) and non-international (Protocol II) armed
conflicts 1980 Convention on prohibitions or restrictions on the use of certain conventional
weapons which may be deemed to be excessively injurious or to have indiscriminate effects
(CCW), which includes:
• the Protocol (I) on non-detectable fragments
• the Protocol (II) on prohibitions or restrictions on the use of mines, booby traps and other
devices
• the Protocol (III) on prohibitions or restrictions on the use of incendiary weapons
1993 Convention on the prohibition of the development, production, stockpiling and use of
chemical weapons and on their destruction
1995 Protocol relating to blinding laser weapons (Protocol IV [new] to the 1980 Convention)
1996 Revised Protocol on prohibitions or restrictions on the use of mines, booby traps and other
devices (Protocol II [revised] to the 1980 Convention)
1997 Convention on the prohibition of the use, stockpiling, production and transfer of
antipersonnel mines and on their destruction
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1998 Rome Statute of the International Criminal Court

1999 Protocol to the 1954 Convention on cultural property
2000 Optional Protocol to the Convention on the rights of the child on the involvement of
children in armed conflict 2001 Amendment to Article I of the CCW Only States may become
party to international treaties, and thus to the Geneva Conventions and their Additional
Protocols. However, all parties to an armed conflict – whether States or non-State
actors – are bound by international humanitarian law. At the end of 2003, almost all the world‘s
States – 191, to be precise – were party to the Geneva Conventions. The fact that the treaties are
among those accepted by the greatest number of countries testifies to their universality. In the
case of the Additional Protocols, 161 States were party to Protocol I and 156 to Protocol II by the
same date.
The purpose of international humanitarian law is to limit the suffering caused by war by
protecting and assisting its victims as far as possible. The law therefore addresses the reality of a
conflict without considering the reasons for or legality of resorting to force. It regulates only
those aspects of the conflict which are of humanitarian concern. It is what is known as jus in
bello (law in war). Its provisions apply to the warring parties irrespective of the reasons for the
conflict and whether
or not the cause upheld by either party is just. In the case of international armed conflict, it is
often
hard to determine which State is guilty of violating the United Nations Charter. The application
of humanitarian law does not involve the denunciation of guilty parties as that would be bound to
arouse controversy and paralyse implementation of the law, since each adversary would claim to
be a victim of aggression. Moreover, IHL is intended to protect war victims and their
fundamental rights, no matter to which party they belong. That is why jus in bello must remain
independent of jus ad bellum or jus contra bellum (law on the use of force or law on the
prevention of war). Jus in bello: to protect and assist victims of armed conflicts.
Basic rules of IHL

1. Persons who are hors de combat (outside of combat), and those who are not taking part in
hostilities in situation of armed conflict (e.g., neutral nationals), shall be protected in all
circumstances.
2. The wounded and the sick shall be cared for and protected by the party to the conflict which
has them in its power. The emblem of the "Red Cross", or of the "Red Crescent," shall be
required to be respected as the sign of protection.
3. Captured persons must be protected against acts of violence and reprisals. They shall have
the right to correspond with their families and to receive relief.
4. No one shall be subjected to torture or to cruel, inhuman, or degrading treatment or
punishment.
5. Parties to a conflict do not have an unlimited choice of methods and means of warfare.
6. Parties to a conflict shall at all times distinguish between combatants and non-combatants.
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Attacks shall be directed solely against legitimate military targets.
IHL provisions and principles protecting civilians

Principle of distinction
The principle of distinction protects civilian population and civilian objects from the effects of
military operations. It requires parties to an armed conflict to distinguish at all times, and under
all circumstances, between combatants and military objectives on the one hand, and civilians and
civilian objects on the other; and only to target the former. It also provides that civilians lose
such protection should they take a direct part in hostilities. The principle of distinction has also
been found by the ICRC to be reflected in state practice; it is therefore an established norm of
customary international law in both international and non-international armed conflicts.
Necessity and proportionality
Necessity and proportionality are established principles in humanitarian law. Under IHL, a
belligerent may apply only the amount and kind of force necessary to defeat the enemy. Further,
attacks on military objects must not cause loss of civilian life considered excessive in relation to
the direct military advantage anticipated. Every feasible precaution must be taken by
commanders to avoid civilian casualties. The principle of proportionality has also been found by
the ICRC to
form part of customary international law in international and non-international armed conflicts.
Principle of humane treatment The principle of humane treatment requires that civilians be
treated humanely at all times. Common Article 3 of the GCs prohibits violence to life and person
(including cruel treatment and torture), the taking of hostages, humiliating and degrading
treatment, and execution without regular trial against non-combatants, including persons hors de
combat (wounded, sick and shipwrecked). Civilians are entitled to respect for their physical and
mental integrity, their honor, family rights, religious convictions and practices, and their manners
and customs. This principle of humane treatment has been affirmed by the ICRC as a norm of
customary international law, applicable in both international and non-international armed
conflicts.
Principle of non-discrimination
The principle of non-discrimination is a core principle of IHL. Adverse distinction based on race,
sex, nationality, religious belief or political opinion is prohibited in the treatment of prisoners of
war, civilians, and persons hors de combat. All protected persons shall be treated with the same
consideration by parties to the conflict, without distinction based on race, religion, sex or
political opinion. Each and every person affected by armed conflict is entitled to his fundamental
rights and guarantees, without discrimination. The prohibition against adverse distinction is also
considered by the ICRC to form part of customary international law in international and non-
international armed conflict.
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What is a war crime?

War crimes are understood to mean serious violations of international humanitarian law
committed during international or non-international armed conflicts. Several legal texts contain
definitions of war crimes, namely the Statute of the International Military Tribunal established
after the Second World War in Nuremberg, the Geneva Conventions and their Additional
Protocols, the Statutes and case law of the International Criminal Tribunals for the former
Yugoslavia and Rwanda, and the Statute of the International Criminal Court. Definitions of the
notion of war crime are also given in the legislation and case law of various countries. It is
important to note that one single act may constitute a war crime.
The following acts are, among others, included in the definition of war crimes:
• wilful killing of a protected person (e.g. wounded or sick combatant, prisoner of war, civilian);
• torture or inhuman treatment of a protected person;
• wilfully causing great suffering to, or serious injury to the body or health of, a protected person;
• attacking the civilian population;
• unlawful deportation or transfer;
• using prohibited weapons or methods of warfare;
• making improper use of the distinctive red cross or red crescent emblem or other protective
signs;
• killing or wounding perfidiously individuals belonging to a hostile nation or army;
• pillage of public or private property.
It should be noted that the International Criminal Tribunal for the former Yugoslavia has
recognized that the notion of war crime under customary international law also covers serious
violations committed during non-international armed conflicts. The Statute of the International
Criminal Court and the Statute of the International Criminal Tribunal for Rwanda also include in
their respective lists of war crimes those committed during internal armed conflicts.
International humanitarian law and international human rights law (hereafter referred to as
human rights) are complementary. Both strive to protect the lives, health and dignity of
individuals, albeit from a different angle. Humanitarian law applies in situations of armed
conflict whereas human rights, or at least some of them, protect the individual at all times, in war
and peace alike. However, some human rights treaties permit governments to derogate from
certain rights in situations of public emergency. No derogations are permitted under IHL because
it was conceived for emergency situations, namely armed conflict. Humanitarian law aims to
protect people who do not or are no longer taking part in hostilities. The rules embodied in IHL
impose duties on all parties to a conflict. Human rights, being tailored primarily for peacetime,
apply to everyone. Their principal goal is to protect individuals from arbitrary behavior by their
own governments. Human rights law does not deal with the conduct of hostilities. The duty to
implement IHL and human rights lies first and foremost with States.
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Humanitarian law obliges States to take practical and legal measures, such as enacting penal
legislation and disseminating IHL. Similarly, States are bound by human rights law to accord
national law with international obligations. IHL provides for several specific mechanisms that
help its implementation. Notably, States are required to ensure respect also by other States.
Provision is also made for an enquiry procedure, a Protecting Power mechanism, and the
International Fact- Finding Commission. In addition, the ICRC is given a key role in ensuring
respect for the humanitarian rules. Human rights implementing mechanisms are complex and,
contrary to IHL, include regional systems. Supervisory bodies, such as the UN Commission on
Human Rights, are either based on the UN Charter or provided for in specific treaties (for
example the Human Rights Committee, which is rooted in the International Covenant on Civil
and Political Rights of 1966).
The Human Rights Commission and its Sub commissions have developed a mechanism of
―special rapporteurs‖ and working groups, whose task is to monitor and report on human rights
situations either by country or by topic. Six of the main human rights treaties also provide for the
establishment of committees (e.g. the Human Rights Committee) of independent experts charged
with monitoring their implementation. Certain regional treaties (European and American) also
establish human rights courts. The Office of the UN High Commissioner for Human Rights
(UNHCHR) plays a key part in the overall protection and promotion of human rights. Its role is
to enhance the effectiveness of the UN human rights machinery and to build up national, regional
and international capacity to promote and protect human rights and to disseminate human rights
texts and information.
CHAPTER SEVEN: POLITICS AND HUMANITARIANISM

Humanitarian action has always been a highly political activity. The provision of humanitarian
assistance and protection has relied upon engaging with political authorities in conflict-affected
countries, and thus influenced the political economy of conflict. At the same time the provision
of humanitarian assistance has been influenced by domestic political considerations in donor
countries, reflected by the fact that different emergencies, and different groups affected by them,
have received more or less relief aid. The issue is not whether humanitarian aid is political, but
how. The past decade has seen profound changes in the relationship between humanitarian and
political action. Increasing recognition of the political origins of vulnerability in complex
emergencies led the 1996 Joint Evaluation of the International Response to the Genocide in
Rwanda to famously conclude ‗...that humanitarian aid cannot be a substitute for political
action‘, and to call for increasing coherence between political and humanitarian efforts. Thus, the
Rwanda experience challenged the idea of separation, and urged closer integration between aid
and political responses.
This report added momentum to a new approach to security articulated by the UN Secretary-
General in 1992 in his Agenda for Peace. This sought to overcome the conceptual and
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bureaucratic divisions that had previously separated aid and politics, by pursuing a new vision of
what was called ‗human security‘. The analysis of the causes of conflict was broadened to
include social, economic and environmental factors, and the UNSG called for the mobilization of
political, military and aid assets in a coherent manner to build peace and security.
International intervention in the internal affairs of states – including humanitarian intervention –

was limited during the Cold War by an unconditional respect for states‘ sovereignty. Such
respect was a key premise of the decolonization process, in that it protected the right to self-
determination, free of external interference, and was functional in containing the risk of direct
confrontation between the superpowers.
In the post-Cold War era, unconditional respect for sovereignty has given way to a much more
interventionist regime of international relations. Of itself, sovereignty is no longer a sufficient
qualification for membership of the international community. Instead, states must be able to
demonstrate their commitment to uphold international law and to adhere to basic principles of
economic and political behavior. States that do not adhere to these values are increasingly
excluded from the mainstream of international relations, and are subject to a range of punitive
measures.
These range from punitive conditionalities on economic aid, to sanctions, to full-blown invasion.
Until NATO‘s intervention in Kosovo in 1999, these experiments in political and military
intervention were regulated by the UN Security Council.
These experiments have coincided with a redefinition of security. States and international bodies
such as the UN and EU, no longer define security primarily in terms of armies, alliances and
treaties. Instead, national and global security is seen to embrace not only political and military
dimensions, but economic, social, and environmental factors. Thus, for example, addressing the
root causes of conflict in developing countries for example, is seen to be important in preventing
large refugee flows into the West. This renewed scope for intervention has coincided with the
emergence of new patterns of conflict.
During the Cold War, the superpowers were an important source of finance and political
legitimation for allied states and their opponents. This gave the Permanent Members of the
Security Council considerable leverage over their respective allies. This influence was
sometimes used to remind warring parties of their obligations under international law and to
promote peace settlements. In the post-Cold War era, political disengagement by the major
powers from various proxy wars has meant that their influence over many contemporary
conflicts has diminished. The withdrawal of superpowers‘ subsidy for proxy wars in the South
has also meant that warring parties have come to rely upon extracting resources from civilians
and exploiting primary commodities such as gems, oil and forest products. This process has
served to loosen the ties of reciprocity between civilians and armed groups that characterized
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revolutionary and independence struggles, and created the conditions for massive abuse of
human rights and destruction of livelihoods. It has created an economic rationale for sustaining
conflict. Thus, while many conflicts have become more lethal for civilians, so the means of
international political influence over the belligerents have diminished. Although there is now
greater consensus on the international community‘s right to intervene in other people‘s wars,
there is much less agreement regarding what types of intervention are legitimate and effective.
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COURSE 14: DEVELOPMENT THEORIES AND PRACTICES

Unit One
Development: An Introduction
1.1 The Concept of Development

You might have some clue about what development is because it is a term that is often used by
people especially in academic institutions. Development is multi-faceted and its understanding
presupposes the recognition that there exist several disciplines which have their own approaches
to the concept and its conceptualization. In this course, and for this program of governance and
development studies, development is all about changes and progress of a society in economy,
technology, politics, and socio-cultural organizations.
Because the term development may mean different things to different people, it is important at
the outset that we have some working definition or core perspective on its meaning. You know
that some countries are considered to be more developed than others. It is not uncommon to
come across references to the Less Developed Countries (LDC) as compared to the Developed
Countries (DCs). Similarly, within our own country, some regions are said to be more developed
than others. Clearly, development, therefore involves making relative comparisons.
Development implies an overall positive change in the physical quantity and quality of life. This
positive change for the better encompasses economic growth as well as social aspects. Therefore,
development not only calls for economic but also the equitable distribution of the gains made
from economic growth. In other words, development implies growth with justice. It means an
improvement in the quality of life through better health, education, housing and overall material
and social welfare.
1.2 Elements of Developments

The basic elements of development are the following:
 Removal of inequality and poverty
 Increase in material welfare of the people
 Increase in social well-being (education, health, housing, etc.)

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 An equitable distribution of the gains of development among different groups of

people in a region or country
 An enhancement in technology and the capacity to produce a wider range of goods

and services in the economy leading to a better quality of life.
 Building institutional structures which permit participation in decision-making at all

levels, equalization of opportunities for development and removal of disparities.
Development is a value-laden and subjective concept with different definitions as given by

different professionals. Development means basically unfolding or opening-up something, which
is latent and with people it means opening up or unfolding their potential powers. It just refers to
a change that is desirable.
But since what is desirable at a particular time, place and in a particular culture or context may
not be desirable at other places, or at other times in the same place and in the same cultural
setting, it is impossible to think of a universally acceptable definition of development. However,
at best one can define development in the given societal context as a set of desirable societal
objectives which society seeks to achieve.
For a long time, it was assumed that development depends primarily on economic growth and
would automatically occur if economic growth took place. This view of development has,
however, been criticized on the ground that it ignores the distribution of the gains from growth,
and also how the growth has been achieved and at what costs. An increase in production in a
country doesn‘t automatically mean that there has been better distribution of what has been
produced. This has meant that the question of distributive justice has assumed greater
importance.
1.2 Development and Growth
It is necessary to understand the difference between the concept of economic growth and
development. Economic growth means an increase in the value of all goods and services
produced in an economy. The sum total of all goods and services in an economy is termed as the
Gross Domestic Product (GDP). Growth is, therefore a sustained expansion in the productive
capacity of an economy leading to sustained rise in its GDP. Development, on the other hand is
asustained improvement in material welfare, particularly for those who are poor and afflicted by
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poverty, illiteracy and poor health conditions. Development is therefore, a qualitative concept
involving a qualitative improvement in the general standard of living in a country or economy.
1.3 Indicators/characteristics of Development and underdevelopment
The following are some of the most important characteristics of under-development. Using these,
you should be able to roughly differentiate between developed and developing countries. Thus,
we can consider these characteristics as yardsticks or indicators or bases of measurement by
which comparisons between/among regions and countries can be made.
Most developing countries are characterized by the following conditions:
o Mass poverty-The poverty levels are very striking in the developing countries.
o Low levels of income and concentration of incomes in a few hands- Low levels of
income for large sections of the masses and high inequalities in the distribution of income
are very apparent in the developing countries due to the fact that assets are unequally
distributed. This perpetuates the problem of low incomes for the poor. The existence of
mass poverty amidst glaring inequalities is among the most important symptoms of
inadequate development in the low income counties.
o Low levels of productivity and backward technology are the other problems of the
developing countries. Increased productivity is an indication of greater efficiency.
Improvement in technology and better management and organization are necessary for
this purpose. For instance, in the agricultural sector greater use of fertilizers, improved
varieties of seeds, better ploughs, etc can lead to increase in output from the same unit of
land. Generally, crop yields per hectare in the developed world are far higher than those
in developing countries. The need to improve technology and the overall input package in
agriculture is obvious.
o High levels of unemployment and underemployment are characteristics of developing

countries. Since the level of industrialization is low and the agricultural sector cannot
absorb the entire workforce, the problem of unemployment and underemployment
continues to grow. The pressure of unemployment also perpetuates the problem of low
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wages as employers take advantage of surplus labor and pay low wages; workers are not
able to bargain because there are thousands willing to do the same work at the prevailing
rates.
o Poor health, nutrition, illiteracy and poor housing are also characteristic features of
developing countries. The low levels of income obviously play a central role in
perpetuating these problems. As earnings are low, people aren‘t able to consume a
balanced diet providing the requisite number of calories and nutrients. The most
vulnerable are the children in the developing countries. Compared to standards prevailing
in the developed countries, the death rates are still very high in the developing countries.
Similarly, there are huge gaps between the developed and developing countries in the
field of education. It is particularly striking that the major problem is with respect to
female illiteracy. As mentioned earlier, inadequate growth and low levels of income are
obviously the reasons that perpetuate such deprivations. It must be stressed; however that
public policy has to play a critical role in addressing these problems.
o Lower status of women- In underdeveloped countries, women are much more vulnerable
than their counterparts in the developed countries. On most development indicators, they
rank lower than their own country. Their health and nutrition is not at satisfactory levels
for large numbers. Female illiteracy is highly widespread. They also have to put up with
both covert and overt forms of discrimination and the barriers regarding their roles in the
society. Women are often paid lower wages even though they perform the same work.
The crudest and the most gruesome form of discrimination against women in many parts
of the world is reflected in the terrible phenomenon of what has come to be known as
„missing women‟ caused by practices such as female feticide, infanticide, etc resulting in
excessive mortality among them.
1.4 Dissatisfaction with the Conventional Indicators of Development
Traditionally, growth was taken as the most, if not the only, indicator of development. The use of
Gross National Product (GNP) or the Gross Domestic Product (GDP) as the indicator of
development has been criticized on several accounts. Development can be viewed in terms of
progress in (i) Output and income (ii) Conditions of production (iii) level of living (nutrition,
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health, housing and education, etc.), (iv) attitude toward work (v) proliferation of sound
institutions and policies.
 GNP as an average level of income (per capita) ignores the inequality in the distribution
of national income;
 It also ignores the availability and utilization of goods and services and has nothing to say
on availability or otherwise of a whole range of basic needs such as health, education,
water, shelter, etc; and
 It tends to conceal the lower than average condition of the deprived.
Given these deficiencies of GNP/GDP as an indicator, several alternative contending indicators

of development have been suggested at different juncture by social scientists.
Hence, Human Development Index (HDI) is a recently developed index to measure development
involving both economic and social key indicators. It measures the average achievements in a
country in three basic dimensions of human development.
 A long and healthy life, as measured by life expectancy at birth;
 Knowledge, as measured by the adult literacy rate and the combined primary, secondary
and tertiary gross enrollment ratio; and
 A decent standard of living as measured by GDP per capita in PPP (purchasing Power
Parity) $ USD.
The fundamental criterion of economic development is the total output/products (goods and
services) of the economy. Production function is therefore the keystone of economic growth
structure. Total output rate at a given time is (Yt) is the function of the quantities of various
inputs actually used in production and the major forces conditioning the productivity of the
production factors. Production/ productivity conditioning forces include technology, institutions
and other elements of socio-economic environment.
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There are other common socio-economic indicators of development used by many organizations
including UN organizations. Accordingly, the following are identified as some of the indicators:
 Expectation of life at birth;
 Consumption of animal protein per capita per day;
 Combined primary and secondary school enrolment;
 Average number of persons per room;
 Newspaper circulation per 1000 population;
 Agricultural production per male agricultural worker;
 Percent of adult men labor in agriculture;
 Percent of economically active population in service sector (gas, electricity, water etc);
 Percent of GDP derived from manufacturing;
 Electric consumption, kw/h Per capita;
 Steel consumption per capita;
 Percent of population in localities of 20, 000 and over, cities (urbanization level)
The view that income and wealth are not ends in themselves but instruments for other purposes
goes back at least as far as Aristotle. Amartya Sen, the 1998 Nobel laureate in economics, argues
that the ―capability to function‖ is what really matters for status as poor or non-poor person. As
Sen puts it, ―Economic growth cannot be sensibly treated as an end in itself. Development has to
be more concerned with enhancing the lives we lead and the freedoms we enjoy.‖
In effect, Sen argues that poverty cannot be properly measured by income or even by utility as
conventionally understood; what matters is not the things a person has-or the feeling these
provide-but what a person is, or can be, and does, or can do. What matters for well-being is not
just the characteristics of commodities consumed, as in the utility approach, but what use the
consumer can and does make of commodities. For example, a book is of little value to an
illiterate person (except perhaps as cooking fuel or as a status symbol). Or as Sen noted, a person
with parasitic disease will be less able to extract nourishment from a given quantity of food than
someone without parasites. Sen‘s approach is valid for more developed countries as well. For
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example, most of the things one could do with the personal computer one buys are never
understood or even known, let alone ever used, by anyone other than specialists. Of course,
sometimes people want more ―features‖ just in case they might want to use them. But if we
exclude items of this kind, a computer with unused characteristics is no better than one without
these characteristics. `
1.5 Values of Development
Is it possible to define or broadly conceptualize what we mean when we talk about development
as the sustained elevation of an entire society and social system toward a ―better‖ or ―more
humane life? What constitute the good life is a question as old as philosophy and humankind,
one that must be periodically revalued and answered afresh in the changing environment of
world society.
Values are desired conditions in a society (e.g. health, fame, long life, high income, etc.). There
are at least three basic and practical guidelines for understanding the inner meaning of
development. These core values are sustenance, self-esteem, and freedom. They represent
common goals sought by all individuals and societies. They related to fundamental human needs
that find their expression in almost all societies and cultures at all times. Dear students, let us
therefore examine each in turn.
1.5.1 Sustenance: The Ability to Meet Basic Needs
All people have certain basic needs without which life would be impossible. These, life
sustaining, basic human needs include food, shelter, health and protection. When any of these is
absent or in critically short supply, a condition of ―absolute underdevelopment‖ exists. A basic
function of all economic activity, therefore, is to provide as many people as possible with the
means of overcoming the helplessness and misery arising from a lack of food, shelter, health and
protection. To this extent, we may claim that economic development is a necessary condition for
the improvement in the quality of life that is development. Without sustained and continuous
economic progress at the individual as well as the societal level, the realization of the human
potential wouldn‘t be possible. One clearly has to ―have enough in order to be more.‖ Raising
per capita income, elimination of absolute poverty, greater employment opportunities and
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lessening income inequalities therefore constitute the necessary but not the sufficient conditions
for development.
Without improving the levels of living (life sustenance) the prospect for development is non-
existent. The first priority of moving from a chronic state of underdevelopment to one of
development must be raising people‘s level of living in terms of food, shelter, clothing, footwear,
education, health, employment and social services.
1.5.2 Self-esteem: To be a person
A second universal component of the good life is self-esteem. Self-esteem is an inherent value of
human beings. Self-esteem features a sense of worth and self-respect, of not being used as a tool
by others for their own ends. It is difficult to feel self-esteem without development, which
includes better material welfare. From this natural value of human being, development is
legitimized as a goal of gaining self-esteem.
All peoples and societies seek some basic form of self-esteem, although they may call it
authenticity, identity, respect, honor, or recognition. The nature and form of this self-esteem may
vary from society to society and from culture to culture. However, with the proliferation of the
―modernizing values‖ of developed nations, many societies in Third World countries that have
had a profound sense of their own worth suffer from serious cultural confusion when they come
in contact with economically and technologically advanced societies. This is because national
prosperity has become an almost universal measure of worth. Due to the significance attached to
material values in developed nations, worthiness and esteem are nowadays increasingly
conferred only on countries that possess economic wealth and technological power-those that
have ―developed.‖
The relevant point is that underdevelopment is the lot of the majority of the world‘s population.
As long as esteem or respect was dispensed on grounds other than material achievement, it was
possible to resign oneself to poverty without feeling disdained. Conversely, once the prevailing
image of the better life includes material welfare as one of its essential ingredients it becomes
difficult for the materially ―underdeveloped‖ to feel respected or esteemed. Nowadays the Third
World seeks development in order to gain the esteem which is denied to societies living in a state
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of disgraceful ―underdevelopment.‖ Development is legitimized as a goal because it is an

important perhaps even an indispensable, way of gaining esteem.
1.5.3 Freedom from Servitude: To be able to choose
A third and final universal value that constitute the meaning of development is the concept of
human freedom. Freedom here is to be understood in the sense of emancipation from alienating
material conditions of life and from social servitude to nature, ignorance, other men, misery
institutions and dogmatic and harmful beliefs. Freedom involves an expanded range of choices
for societies and their members together with a minimization of external constraints in the
pursuit of some social goal we call development.
W. Arthur Lewis stressed the relationship between economic growth and freedom from servitude
when he concluded that ―the advantage of economic growth is not that wealth increases
happiness, but that it increases the range of human choice.‖ Wealth can enable people to gain
greater control over nature and the physical environment (e.g. through the production of food,
clothing and shelter) than they would if they remained poor. It also gives them freedom to
choose greater leisure, to have more goods and services, or to deny the importance of this
material wants and live a life of spiritual contemplation. The concept of human freedom should
also encompass various components of political freedom including, but not limited to personal
security, the rule of law, freedom of expression, political participation, and equality of
opportunity. Some of the most notable economic success stories of the 1970s and 1980s (Saudi
Arabia, Chile, South Korea, Singapore, Malaysia, Thailand, Indonesia, Turkey, and china,
among others) did not score highly on the 1991 Human Freedom Index compiled by the United
Nations Development Program (UNDP). Development is expected to endow people with ability
of choosing. Development in wealth increases happiness, control over nature and physical
environment.
1.6 Objectives of Development
We may conclude that development is both a physical reality and a state of mind in which
society has through some combination of social, economic and institutional processes, secured
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the means for obtaining a better life. Whatever the specific components of this better life,
development in all societies must have at least the following objectives:
 Increasing availability and widening the distribution of basic life sustaining goods and
services to members of society;
 Improved family income of an adequate level for subsistence package of food, shelter,
clothing, footwear and other expenditure;
 Providing of more jobs (employment). Job or employment in addition to its role of

distribution of income to assure consumption, it plays an important role in developing
personality of individuals;
 Improved conditions of production and work;
 Improving access to education that also serves not only to enhance material well-being,
but also to generate greater individual and national self-esteem;
 Improving social and economic equality;
 Providing or opening opportunities to the people to participate in governance at all and

grassroots level;
 Promoting cultural and humanistic values and social discipline (positive attitude to work)
 Expanding the range of economic and social choice of individuals and nations by freeing
them from servitude and dependence not only in relation to other people and nation but
also to forces of ignorance and human misery.
 Keeping-up national independence, consolidation and sovereignty without interference

from other foreign governments.
1.7 Major Issues in Development
It must be emphasized that there cannot be a single well defined path towards development.
Different countries and regions will have their own specificities into account in order to develop
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their societies. This is one reason why development has been a much debated subject. In this
section we will highlight some of the major issues, which have featured in this debate and
provide contrasting accounts for making policy priorities.
i) Growth – versus – Distribution
For a long time it was assumed that economic growth would be an engine that will lead naturally
towards development. Consequently, little or no attention was paid to the question of distributive
justice. One of the major outcomes of this situation was the ‗trickle down‘ theory, which stated
that if there was sufficient growth everybody would benefit from it. However, growth by itself
doesn‘t guarantee an improvement in the quality of life for the vast number of people.
ii) Agricultural Versus Industrial Development
This has been one of the most important issues at stake in the debate on development. If the
agricultural sector doesn‘t grow there may be sharp increase in the prices of food-grains that will
affect the poor. On the other hand, industrial stagnation will mean that surplus labor from the
agricultural sector can‘t be usefully employed. Therefore, both agriculture and industry will have
to grow so that the pace of development is fast enough to improve the living conditions of the
people.
iii) Capital versus Labor Intensive Technology and Development
Youmay have heard the term ‗technology‘ being used quite often in debates pertaining to
development. Technology is a means by which goods are manufactured in an economy. Any
goods, however crude or sophisticated, can actually be manufactured by several means. The
development in technology is the process by which the manufacture of goods is made cheaper,
faster and more efficient.
You may be aware of the fact that tractors, harvesters, etc. are being used on a wider scale now
than a couple of decade‘s age. They are now used to perform many of the agricultural operations,
which were hitherto performed manually using ploughs and other equipments; this change may
be termed a technological change.
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Now that you are familiar with this concept you must be able to appreciate that at any given
point of time, we may have a number of technologies to choose from in order to produce the
same goods. Cloth can be woven on traditional looms in your village or town, or it can be
manufactured in the factories located in bigger cities. The end product is more or less the same,
but the process of making it is different.
An improvement in technology calls for investment to make this change feasible. Sophisticated
technology, when it uses less labor, is termed ―labor displacing technology‖. On the other hand,
an improvement in technology can also be made without displacing labor and also less
expensively. This is called ―labor intensive technology‖. Capital intensive and labor displacing
technologies are often expensive and call for large investments. Labor intensive technologies on
the other hand have the advantage of being able to absorb the surplus labor in a developing
country.
During the 196os and the early 1970s, a new trend of thinking on technology suitable to
developing societies became popular. The question raised was that of “Appropriate
Technology”. It was said that developing countries should adopt technologies that are suitable
for their own specific needs, situations and socio-cultural framework rather than copy the
western technologies blindly. Thus it was suggested that countries like Ethiopia should use
technologies that have evolved over many decades and adapt them to make the best use of their
cost-effectiveness.
The choice between these types of technology, however, is not easy for a developing country. On
the one hand, rapid increase in output is necessary to solve the problems of the people and, on the
other; the problem of unemployment (thus created) accentuates the problem of poverty. A balance is,
therefore, required so that both technology and living conditions of the people improve.
iv) Centralization versus Decentralization
This has been another major issue in the debate on development. Generally, it is agreed that development
is a long-term phenomenon and therefore, needs to be planned. While a certain degree of centralization is
necessary to coordinate the efforts towards development, too much of centralization in the case of
decision making powers can weaken the process of popular participation. It also leads to the formulation
of programs and projects, which have limited local relevance.
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It is hoped that decentralization of the development process would also lead to greater accountability to
those who are actually involved in the decision making process. Devolution of power is very vital for
development. This ensures that the administration is brought closer to the people. Consequently, there is
greater accountability of planners towards those whom programs and policies are meant to reach.
v) Urban versus Rural Development
The vast majority of the population in Ethiopia and other developing countries live in rural areas. There is
a continuing influx of people into the cities looking for jobs as the rural economy is not been able to
provide employment to them. It needs to be pointed out that the problem of poverty, poor health and
illiteracy is widespread in both rural as well as urban areas of developing countries. The problem of rural
poverty and unemployment is the crux of the problem, without solving it, there cannot be genuine
development. Hence, rural development has come to acquire critical importance. Sustained improvement
in the quality of life in rural areas is likely to slacken the pace of large-scale migration of villagers to
cities in search of jobs.
vi) Respective roles of the State and the Market
One of the most contentious issues in Economics has been the scope and extent of government
intervention in the economy of the country. During the immediate post WWII era, there was a near
consensus among economists, for a variety of reasons, such as important developments in economic
theory around the idea of „market failure‟ (which had several dimensions) that governments have to play
major roles in the economic sphere.
Unit Two
Theories of Development and Underdevelopment
Section One: Classical Theories of economic growth and Development:

Modernization School of Thought
2.1.1 The Modernization Theory: A General Overview

The modernization theory has roots from the historical North-South relations. In the years since
the late 1940‘s, two related, but far from being identical discourses of development theories
emerged. These were the modernization theory and the neo-liberal development doctrine (there
is a separate section on the neo-liberal doctrine). In the 1950‘s and 1960‘s, newly independent
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states came into existence and hence the conceptualization of ―modernization process‖ became
central. Theories of modernization are based on the assumption that societal change is a linear
process involving the transformation of traditional, agrarian societies into modern, industrial
societies.
Modernization theory was initially optimist about the prospect of development in the South. It
encompassed questions and answers of economic growth, development of social institutions,
political change, and psychological factor in the South. The theory was believed to be designed
as a problem solving theory; it is also policy-oriented towards social change and economic
growth. It offers an explanation of how and why change take place, but it is based largely on the
assumption that the capitalist model is universally applicable.
Modernization theory viewed the process of development as a series of successive stages of

economic growth through which all countries must pass. The right quantity and mixture of
saving, investment and foreign aid were all thought to be necessary to enable Third World
nations to proceed along an economic growth path that had been followed by the more developed
countries. Development thus became synonymous with rapid economic growth.
The proponents of modernization theory argue that Third World countries could and should
follow a path of political and economic development parallel to the one traveled by the advanced
western societies. To accomplish this, the theory insisted that societies of the South should create
and acquire modern cultural values and modern political and economic institutions.
According to this theory, development in developing countries would come about and would be
engineered through the diffusion of innovations, capital, technology, modern ideas,
entrepreneurial ship, democratic institutions, and values from the developed western societies.
For this theory, the diffusion of these modernizing factors faced barriers that hampered
development in the South. These barriers are traditional, cultural values of the societies of the
South. To deal with these barriers, revolution in economic and social sphere is important.
2.1.2 Rostow’s Stages of Economic Growth: A Non-Communist Manifesto

Walter W. Rostow subscribes to some forms of evolution. All societies go through the same
stages of economic development. He wanted to come up with a generalization which is supposed
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to characterize the history of the industrialization of the developed capitalist countries. His model
was based up on a detailed analysis of the economic history of a number of major industrialized
societies.
His theory was that all nations pass through the same five stages of economic development: the
traditional society, preconditions for take-off, take-off, the drive to maturity, and the stage of
mass consumption. He assumes that it is possible to identify all societies, in their economic
dimension, as lying within one of these stages. For him, technology, saving, entrepreneurialism,
and the correct political system were all key motors in moving countries along this path.
He tried to define the various stages of economic growth by certain economic and social
characteristics. This theory of five stages is practically a theory of the industrial revolution
interpreted in a particular way, in which the first two stages were seen as being preparatory to the
industrial revolution, and the last two as its results, i.e. self-sustained growth. The fact of the
industrial revolution of the take-off however can only be inferred from its results, from sustained
growth. The concept of self-sustained growth is however a misleading oversimplification. No
growth is purely self-sustaining or purely self-limiting. Now let‘s dwell on the different stages
proposed by Rostow through which he expected all societies to pass.
Stage one: The Traditional Society

A traditional society is one whose structure is developed within the limited production function.
In this stage, varying degrees of manufacturing developed, but as in agriculture, the level of
productivity was limited by the inaccessibility of modern science and its application. Because of
the limitation of productivity, these societies had to devote a very high proportion of their
resources to agriculture. Flowing from the agriculture system, there was a hierarchical social
structure with relatively narrow scope for vertical mobility. Moreover, family and clan
connections played a large role in social organizations.
In terms of history, with the phrase ―traditional society‖, he referred to societies like the
dynasties in China, the civilizations of the Middle East and the Mediterranean, the world of the
medieval Europe, and those current societies that remained untouched or unmoved by man‘s new
capability for regularly manipulating his environment to his economic advantages.
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Stage two: Precondition for Take-off

This second stage of growth embraces societies in the process of transition. The major
characteristics of the traditional society began to change such a way as to permit regular growth;
its politics, social structure, ant its values as well as its economy. However it takes time to
transform a traditional society in the ways necessary for it to exploit the fruits of modern science.
This stage initially developed, in a clear marked way, in Western Europe of the late 17th and
early 18th Centuries as the insights of modern science began to be translated in to new production
functions in both agriculture and industry. Among the western European powers, Britain favored
by its geography, natural resources, trading possibilities, and social and political structure, was
the first to develop fully the preconditions for take-off
The factors that accelerated this stage in other societies are not endogenous, but also external
intrusions by some advanced societies. This invasion shocked the traditional society and set in
motion ideas and sentiments which initiated the process by which modern alternatives to
traditional society was constructed out of the old culture. The ideas spread not merely that
economic progress is possible, but that economic progress is a necessary condition for some
other purpose. At this stage, education expanded. New types of enterprises come forward willing
to mobilize savings and to take risks in pursuits of profit. Banks and other institutions for
mobilizing capital appeared. Investment increases, notably in transport, communication and in
raw materials. The scope of internal and external commerce widens. Here and there, modern
manufacturing enterprises appear that use the new method. But still the society is characterized
by traditional low productivity method, and by the old social structures and values. In any case,
the precondition for take-off is a transition between the traditional society and the take-off.
Stage three; Take-off

This is stage is the interval when the old blocks and resistances to steady growth are finally
overcome. Growth becomes its normal condition. In many societies, the proximate stimulus for
take-off is mainly technological.
During this stage, the rate of effective investment and saving rise. New industries expand rapidly
yielding profits, a large proportion of which are reinvested in a new plant. These new industries
in turn stimulate the service sector and a further expansion of urban areas. The whole process of
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expansion in the modern sector yields an increase in income. The new class of entrepreneurs
expands, and it directs the enlarging flows of investment in the private sector. The economy
exploits hitherto unused natural resources and methods of production. New techniques spread in
agriculture and industry, and agriculture is commercialized. The radical change in agricultural
productivity is an essential condition for successful take-off.
Stage four: The Drive to Maturity
The take-off stage is followed by a long interval of sustained progress, even if fluctuating as the
now regularly growing economy drives to extend modern technology over the whole front of its
economic activity. The economy finds itself in the international economy; goods formerly
imported are produced at home, new import requirements develop, and new export commodities
are produced. The economy becomes increasingly efficient, adapting rapidly to further
technological innovations.
The economy, focused during the take-off around a relatively narrow complex of industry and
technology, has extended its range into a more refined and technologically often more complex
processes. This is a stage in which an economy demonstrates that it has the technological and the
entrepreneurial skill to produce not everything, but anything that it chooses to produce. It may
lack the raw material and other supply conditions required to produce a given type of output
economically, but its dependence is a matter of economic choice or a political priority, rather
than a technological or institutional necessity.
Stage five: The Age of High Mass Consumption

At this stage, the leading sectors shift toward durable consumers‘ goods and services. Consumer
durable goods include automobiles, books, household goods (home appliances, consumer
electronics, furniture, tools, etc.), sports equipment, jewelry, medical equipment, firearms, and
toys. Real income per head rises to a point where a large number of people gain a command over
consumption which transcends basic necessities such as food, shelter and clothing. These are
nondurable goods or soft goods (consumables) which are the opposite of durable. structure of
the working force changes in a way which increases not only the proportion of urban to total
population, but also the proportion of the population working in offices or in skilled factory job.
In addition to these economic changes, societies cease to accept the further expansion of modern
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technology as an over-riding objective. The emergence of welfare state is one manifestation of a

society‘s moving beyond technical maturity.
2.The Harrod–Domar model (the note on this part is a direct copy from a text)
The Harrod–Domar model is an early post-Keynesian model of economic growth. It is used in

development economics to explain an economy's growth rate in terms of the level of saving and
productivity of capital. The model assumes that Natural Growth is the growth in economy
required to maintain full employment.
The model was developed independently by Sir Roy F. Harrod in 1939 and EvseyDomar in
1946. They developed their models independently, but the assumptions and results are,
nevertheless, basically the same. They built their theory in the late 1930‘s and mid 1940‘swas
still present, when the memory of industrialized countries being jumped into deep recessions,
with a high unemployment rate and a sharp decline of Gross Domestic Product due to the
recession in 1929 and 1930. Harrod and Domar based their theorizing on the famous work by
Keynes who offered an explanation of why markets may fail to bring about full employment.
The early classical writers fully believed in Say‘s law, stating that supply creates its own
demand. This belief was based on the assumption of the efficient working of markets, especially
factor markets, and on the speedy adjustment of prices to their equilibrium levels at which
demand equals supply. John Maynard Keynes (1936), in The General Theory of Employment,
Interest and Money, denied the frictionless functioning of this process and asserted that
unemployment of factors is even more probable in an economy than full employment. But his
emphasis was on short run implications of his theory underlining the income effect resulting
from additional investment, for example. The capacity effect, resulting from increases in the
capital stock, however, was neglected by Keynes. It is this latter effect that Harrod and Domar
integrated in their work, thus forming a Keynesian theory of economic growth.
The Harrod-Domar model considers a closed economy in which one homogenous good Y is
produced. This good may be either used as an investment good, I , or as a consumption good, C .
The use of it depends on the economic agent. Households consume and save whereas firms
produce and invest. All variables are real and the money market is absent.
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The GDP which equals national income at time t, then, is given by Y (t) = C (t) + I (t).
Consumption and savings are supposed to be a linear homogenous function of national income,
with m c the marginal propensity to consume and m m s =1- c the marginal propensity to save: m
mC(t) = c Y(t), 0 < c <1 and m S(t) = s Y(t) . The constancy of m c and m s implies that marginal
values equal average values. In addition, an equilibrium condition is imposed assuring that
investment equals savings in every period. Another condition asserts that firms intend to realize a
certain capital-output ratio vd = Kd (t) /Y (t), where the superscript d denotes desired values.
This capital-output ratio vd reflects the notion that capital is fully employed if the desired ratio is
realized and again brings about the equivalence of marginal and average variables.
Given the Keynesian character of this model it becomes immediately clear that all variables have
to grow at the same rate. If, for example, investment is constant for all years, the level of
aggregate demand will also remain constant according to Keynesian multiplier theory. But even
a constant level of investment will steadily increase the productive capacity of the economy. This
demonstrates that there must be growth in investment in order to prevent that the growth of
demand does not fall short of the growth of the productive capacity.
The above reasoning has shown that there exists a warranted rate of growth for a Keynesian
economy. But this growth path can only be realized if firms anticipate the growth rate m s / v
and, thus, choose the correct level of investment. Besides the question of the existence of such a
path, it is worth to investigate whether the economy reaches this path if it does not start on it. Let
us assume that an economy does not start on the warranted growth path. Then the capital stock as
a percentage of investment will decline, or, equivalently, the level of investment per unit of the
capital stock will rise, if the actual capital-output ratio is below the desired one and vice versa if
it is above the desired ratio. Omitting the time argument t, this leads to the following differential
equation:
2.1.3 Samuel Huntington’s Political Modernization and Development

Modernization theory makes its philosophical tenet in the comparison between modern and
traditional society. The essential difference between the two lies in the greater control which
modern societies have over natural and social environment. This control, in turn, is based on the
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expansion of scientific and technological knowledge. These differences reflect differences in

fundamental attitudes towards and expectations from the environment.
At the intellectual level, modern society is characterized by the tremendous accumulation of

knowledge about man‘s environment and by the diffusion of this knowledge through society by
means of education and mass communication. In contrast to traditional society, modern society
also involves much better health, longer life expectancy, and higher rates of occupational and
geographical mobility. It is predominantly urban than rural. Economically, there is
diversification of activity as a few simple occupations give way to many complex ones.
Agriculture declines in importance compared to commercial, industrial and other non-
agricultural activities; and commercial agriculture replaces subsistence agriculture. The
geographical scope of the economic activity is far greater in modern society than in traditional
society.
The bridge across the great dichotomy between modern and traditional societies is the grand
process of modernization. The broad outlines and characteristics of this process are described as
follows:
1. Modernization is a revolutionary process. This follows directly from the contrast

between modern and traditional society. The one differs fundamentally from the other,
and the change from tradition to modernity consequently involves a radical and total
change in pattern of human life.
2. Modernization is a complex process. It involves in changes in virtually all areas human

thought and behavior. At a minimum its components include: industrialization,
urbanization, social mobilization, differentiations, secularization, media expansion,
increasing literacy and education, and expansion of political participation.
3. Modernization is a systemic process. Changes in one factor are related to and affect
changes in the other factors.
4. Modernization is a global process. Modernization originated in the fifteenth- and

sixteenth-century Europe, but it has now become a worldwide phenomenon. This is
brought about primarily through the diffusion of modern ideas and techniques from the
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European center, but also in part through the endogenous development of non-western
societies. In any event, all societies were at one time traditional; all societies are now
either modern or in the process of becoming modern.
5. Modernization is a lengthy process. The totality of changes which modernization

involves can only be worked out through time. Consequently, while modernization is
revolutionary in the extent of changes it brings about in traditional society, it is
evolutionally in the amount of time required to bring about those changes.
6. Modernization is a phased process. It is possible to distinguish different levels of phases

of modernization through which all societies will move. All societies will move
essentially the same stages.
7. Modernization is a homogenizing process. Many different types of traditional societies

exist. They have little in common except their lack of modernity. Modern societies, on
the other hand, share basic similarities. Modernization produces tendencies toward
convergence among societies.
8. Modernization is an irreversible process. A society which has reached certain levels of

urbanization, literacy and industrialization in one decade will not decline substantially
lower levels in the next decade. The rates of change will vary significantly from one
society to another, but the direction of change will not.
9. Modernization is a progressive process. The traumas of modernization are many and

profound, but in the long run modernization is not only inevitable, it is also desirable.
Modernization in the long run enhances human well-being.
Huntington defines development more specifically as the ability of society to cope with changes
caused by modernization, arguing that it was therefore necessary top develop institutions capable
of controlling the modernization process. This would, in certain circumstances, mean
authoritarian or totalitarian regimes are necessary for the Third World for them to achieve some
form of development. He, thus, shifted the focus of development and modernization from a
progression toward ‗democracy‘ to a concern with political stability and the role of the
government in the modernization process.
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2.1.4 Talcott Parsons Structural Functionalism: Pattern Variables

Modernization theories attempt to identify the social variables which contribute to the social
progress and development of certain societies and seek to explain the details of social evolution.
French philosopher Emile Durkheim, who is considered one of the founding fathers of sociology,
developed the concept of functionalism which stresses the interdependence of the institutions of
a society and their interaction in maintaining cultural and social unity. His most famous work is
The Division of Labour in Society which described how social order was to be maintained in a
society and how "primitive" societies would make the transition to more economically advanced
industrial societies. Durkheim suggested that in a capitalist society, with the complex division of
labour, such economic regulation would be needed in order to maintain order. He stressed that
the major transition from a primitive social order to a more advanced industrial society could
bring about crisis and disorder. Furthermore, Durkheim developed the idea of social evolution
which indicates how societies and cultures develop over time-much like that of a living
organism, essentially saying that social evolution is just like biological evolution in reference to
the development of its components. Like organisms, societies progress through several stages
generally starting at a simplistic level, and then developing into a more complex level. Societies
adapt to their surrounding environments, but they interact with other societies which further
contribute to their progress and development.
A similar proposition is made by Talcott Parson. Parsons constructed a set of variables that can
be used to analyze the various systems. For him, human behavior follows two dichotomies.
These are the categorization of modes of orientation in personality systems, the value patterns of
culture, and the normative requirements in social systems. These became a way of describing and
classifying different societies, and the values and norms of that society. All of the norms, values,
roles, institutions, subsystems and even the society as a whole can be classified and examined on
the basis of these patterned variables.
For Parsons, these were necessary to make the theory of action more explicit and to develop
clearer specifications of what different contingencies and expectations actors were likely to face.
The patterned variables are set up as polar opposites that give the range of possible decisions and
modes of orientation. Any actual role or decision may be a combination of the two, between the
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opposites. For Parsons though, these provided an ideal type of conceptual scheme that allowed
analysis of various systems of parts of systems. The five pattern variables are as follows.
i. Ascription and Achievement
Ascription refers to qualities of individuals, and often inborn qualities such as sex, ethnicity,
race, age, family status, or characteristics of the household of origin. This best characterizes the
traditional societies. Achievement, on the other hand refers to performance, and emphasizes
individual achievement. For example, we might say that someone has achieved a prestigious
position even though their ascribed status was that of poverty and disadvantage. This is,
according to Parson, typically a characteristic of modern societies.
ii. Functional Diffuseness and Functional Specificity
These refer to the nature of social contacts and how extensive or how narrow are the obligations
in any interaction. For example, in a bureaucracy, social relationships are very specific, where
we meet with or contact someone for some very particular reason associated with their status and
position, e.g. visiting a physician. Friendships and parent-child relationships are examples of
more diffuse forms of contact. We rely on friends for a broad range of types of support,
conversation, activities, and so on. While there may be limits on such contacts, these have the
potential of dealing with almost any set of interests and problems. Accordingly, in traditional
societies there is functional diffuseness. There is no strict delimitation of functions. In modern
societies, institutions and individuals have very specific functions.
iii. Affectivity and Affective Neutrality
Neutrality refers to the amount of emotion or affect that is appropriate or expected in any given
form of interaction. Again, particularism and diffuseness might often be associated with
affectivity, whereas contacts with other individuals in a bureaucracy may be devoid of emotion
and characterized by affective neutrality. Affective neutrality may refer to self-discipline and the
deferment of gratification. This is a characteristic of modern societies. In contrast, affectivity can
mean the expression of gratification of emotions, which characterizes traditional societies.
iv. Particularism and Universalism
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These refer to the range of people that are to be considered, whereas diffuseness and specificity
deal with the range of obligations involved. The issue here is whether to react on the basis of a
general norm or reacting on the basis of someone‘s particular relationship to you. A particular
relation is one that is with a specific individual. Parent-child or friendship relationships tend to
be of this sort, where the relationship is likely to be very particular, but at the same time very
diffuse. In contrast, a bureaucracy is characterized by universal forms of relationships, where
everyone is to be treated impartially and much the same. No particularism or favoritism is to be
extended to anyone, even to a close friend or family member.
v. Collectivity or Self-oriented
These emphasize the extent of self-interest as opposed to collective or shared interest associated
with any action. Each of our social actions is made within a social context, with others, and in
various types of collectivities. Where individuals pursue a collective form of action, then the
interests of the collectivity may take precedence over that of the individual. Various forms of
action such as altruism, charity, self-sacrifice (in wartime) can be included here. In contrast,
much economics and utilitarianism assumes egoism or the self-seeking individual as the primary
basis on which social analysis is to be built. In general, in modern societies behavior is
individualistic (self-oriented), it is collective in traditional societies.
The pattern variables provide a means of looking at various forms that norms and social actions
can take, and what their orientation is. These can describe the nature of societal norms, or the
basic values that guide, and form the basis for decisions in, the personality system. Perhaps these
pattern variables can be thought of as a way that people do relate to situations they face, the type
of orientation they have, and how they are likely to interpret meaning in each social action.
These variables can generally be categorized into expressive and instrumental. Parsons regards
the first half of each pair as the expressive types of characteristics and the second half of the
pattern as the instrumental types of characteristics. Expressive aspects refer to the integrative and
tension aspects. These are people, roles, and actions concerned with taking care of the common
task culture, how to integrate the group, and how to manage and resolve internal tensions and
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conflicts. This may take many different forms but often is associated with the family, and more
specifically with the female role in the family.
The instrumental characteristics refer to the goal attainment and adaptation aspects. These are the
characteristics, people, roles, and actions associated with ideas, problem solving, getting the task
done. These tasks are often associated with male roles, public activities, the economy, or politics.
These can also be used to refer to the type of society. Social action and interaction in early forms
of society were more likely to be characterized by expressive characteristics. In contrast, in
modern societies, with a more complex division of labour and differentiation of statuses and
roles, much of social action and interaction is characterized by instrumental characteristics.
2.1.5 Critiques against the Modernization School of Thought

Although the modernization thinking has been influential in areas of academics and policy
making, it has been criticized by different theories at different times. Some of the major
criticisms waged against the modernization school are the following.
1. One of the structural problems of the modernization theory was that it has uncritically
accepted the relations between the North and the South. It visualized the North as
culturally, politically and economically modern. As a result, it is racist.
2. A related critic argues that modernization theory is Eurocentric. It draws too heavily on
American experience and tends to look at the world from an American point of view.
3. It was too optimistic and simplistic. The proponents of the modernization theory expected
that countries of the South can easily achieve greater economic growth, equity,
democracy, stability, etc… simultaneously and smoothly. As it is observed from different
experiences, economic growth proved to be no guarantee to democracy and other
elements of political development. This was against the expectations of the
modernization theory proponents.
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4. Rostow‘s model in particular is ahistorical. Meaning it is not really historical. His stages
of economic growth do not actually reflect the reality of a single developed capitalist
society.
5. Modernization theory made all poorer countries seem the same. But in reality, there is
diversity within this large category.
6. Modernization theory also wrongly assumes that a process of societal change that was
open to one or more societies in the past is open to all societies in the present or future.
7. It blames only the internal conditions of societies of the South for their lack of
development. It disregarded the external factors that have continued to hamper the
development of these groups of countries.
8. The modernization theory blindly suggested that the western model of development is the
only path of development that the South should adopt. It ignored other alternative paths
to development.
9. The other criticism is related to pattern variables. The critiques argue that there is no as
such strict dichotomy as far as behavior is concerned. There may be elements of
traditional behaviors in modern societies and there may also be modern behaviors in
traditional societies. There is interpenetration of behaviors.
Section Two: The Marxian Concept of Development
This section will try to explore the Marxian conception of development. In this section, you will
learn how Karl Marx theorized the possibilities of development in a society. This section is
further divided into two sub-sections. First section presents the general overview of the Marxist
theory. Economic theories of Marx will be elaborated in the second sub-section. Essentially, you
will learn and will be able to discuss the different economic theories of Marx and analyze the
concept of class struggle in societal progress.
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2.2.1 Marxism: A General Overview

In 1867, Karl Marx published Das Kapital (The Capital), the first volume in the series, and a
work that systematically and historically analyzed the capitalist system. His theories provide
much of the material for arguments that have opposed development models based on capitalism
and the laissez faire system. Marxism is the best-known strand of Structural Thought. The
ideology put forward by Karl Marx termed as Communist Ideology advocates that history
proceeds by means of a historical dialectic or clash of opposing ideas (thesis versus anti-thesis)
with a resulting new order called synthesis. Marxism also holds that the economic material order
determines political and social relationships. Thus, history, the current situation, and the future
are determined by economic struggles between classes, termed dialectical materialism. Thus, the
material dialectic was transformed from domestic class struggle into an international struggle
between bourgeois and proletariat. According to Marx, the state is a creation and tool of the rich
capitalist class and he holds that the state will no longer exist once communism is fully realized.
Focus of Marxist view of development
The Marxian view of development emphasizes the role of classes and class antagonism in
society. In this system, vested class interest can inhibit overall development of society. The
question of poverty in society is seen as the exploitation of the poor working class. Property
relations in the society create and accentuate the problem of poverty and development. Since
land and other productive assets are privately owned and concentrated in the hands of few, the
problem of inequalities remains unsolved. From a Marxist perspective, development is a process
of class struggle.
The Bourgeoisie and the Proletariat class in continuous struggle
Marx believed that just as the bourgeoisie (the capitalist middle class) had relied on
revolutionary movements to wrestle power from the nobility, so, too, could the working class,
called the "proletariat," eventually overthrow the bourgeoisie. For Marx, the eventual fall of the
bourgeoisie was not only desirable, it was inevitable. He reached this conclusion based on his
economic theory of labor. Specifically, he developed the doctrine of surplus value. At the heart
of the doctrine was the conclusion that the worker was being robbed. The worker received only a
fraction of the value of the product which his labor produced. The remainder was kept by the
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capitalist class. This theft eventually led to an economic crisis caused by overproduction-the vast
majority of the population could not afford to consume the products that the owners of capital
produced. The capitalist's answer to this problem was the continual creation of new markets.
According to Marx, the government was a tool used by capitalists to perpetuate themselves in
power.
Marx saw capitalism as an historical necessity because it was the most productive and flexible
economic system in human history. It could move capital and labor to meet demand faster than
any of the previous systems that it had replaced.
Marx recognition of capitalism as a system
Absolutely not! Marx, however, refused to accept capitalism as the ultimate mode of production
(economic system). He believed the system was plagued with internal contradictions that would
inevitably lead to its destruction and replacement by a more advanced system.
According to Marx, the relations of production (the way people interact in a particular economic
system) create different economic classes. For example, under the feudal economic system, two
classes existed: the nobility and the peasantry. The dominant class, the nobility, created a system
to maintain its position. Religion, government, laws, and morals reflected the needs of the
dominant class and were used to perpetuate its position of power. As capitalism emerged, a new
dominant class, the bourgeoisie, began to appear. The nobles and the bourgeoisie eventually
clashed and the latter was victorious.
Marx theory on the inevitability of downfall of capitalism
Marx believed that the advent of capitalism set in motion its own final downfall. He reasoned as
follows. The capitalist system cannot exist without workers. As more factories are built, more
people will be forced to work in them. Thus, under capitalism, the army of workers will
continually expand. With the expansion of capitalism around the world comes the global creation
of a working class.
This system is ruthless, however. In order to survive, capitalists must continually strive to out
produce one another. But not all capitalists will be able to compete. Capital will become
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concentrated in fewer hands. Those bourgeoisies that are unable to compete will be forced to join
the working class or perish. This process will continue until one day the proletariat masses will
be able to take control of the system by overthrowing the bourgeoisie, resulting in a classless
society. No new class will arise because class arises from economic differences, and capitalism
will have eliminated these differences by making everyone a proletariat.
Since the concepts of state, religion, morality, and laws were mechanisms to maintain class
differences, they, too, will disappear. Government will not be eliminated immediately, however.
A limited form of government (a proletariat dictatorship) will be put in place to prevent a
possible attack by any surviving bourgeoisie. This dictatorship will eventually become useless,
and when it does, it will "wither away." At this point, socialism will have been achieved.
For Marx economic development was tied to class struggle. Economic development could only
be achieved as a class; individual achievement was not emphasized. Trust in the government and
cooperation with its goals was also viewed as betrayals of the class struggle. The government's
involvement in social reform was nothing more than an attempt by the bourgeoisie to appease the
workers and thereby force them to abandon the struggle. Since the government reflects the will
of the dominant class, it would never enact any law benefiting the subservient class.
2.2.1 Economic Theories of Marx
The various economic theories he put forward are 1) The theory of work 2) The theory of self-
alienation 3) The labor theory of value and 4) the Theory of surplus value.
i. The Theory of Work

Marx believed that work is the way in which people might express their creativity. By interacting
with nature or labor individuals develop and change their own character. The essence of human
beings therefore, becomes closely related to work. To Marx, work is a form of self-creation. In
other words, the product of our labor is part of us and something of us is definitely there in the
things we produce through our work. For example, an academician gradually looks into whatever
he or she sees or experiences from an academic angle. It becomes part of the academician.
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ii. The Theory of Self-alienation

Human self-alienation occurs because of three factors. First work is a form of self-creativity it
should be enjoyable. Because the capitalists squeeze every cent of profit from the workers, they
make the conditions of work intolerable. Hence instead of enjoying the work, the members of the
proletariat grow to hate the very process by which they could refine their own work.
Consequently they become alienated from their own selves. Secondly, as capitalists exploit the
workers in order to produce profit they force the workers to sell their product and then use that
product against the workers to exploit them further. This forces the workers to regard their own
product as alien and even harmful to them. Thirdly, the capitalists are criticized for mechanizing
production because this process robs laborers of their skills and reduces them to little more than
feeders of machines. This is the ultimate alienation. In the third factor, Marx claims that
socialism was the coming economic system and that it could produce even more than capitalism
which is paradoxical.
iii. The Labor Theory of Value

This theory is concerned with the intrinsic worth of an object. Value is a complex concept. The
value most modern economists are concerned with is the exchange value of an item that is the
amount of money one can get for an item in the market. Sentimental value is another kind of
worth. Sometimes there is sentiment attached to a product although the market value of it would
be high. Use value is the third measure of worth. Even if the sentimental value is low and the
market value is high, the product serves the purpose. Esthetic value is yet another measure. The
gracefulness of beauty of an old building may far exceed its commercial value or its usefulness.
The labor theory of value is concerned with establishing a standard for measuring intrinsic value.
It assumes that there are two kinds of value brought to the production process. Resources,
machinery, and finance are one which is termed as constant value. These when applied to the
production of an item cannot add any value greater than their own intrinsic worth. The labor is
the only variable value because only labor produces something of greater worth than itself.
Hence Marx pays tribute to the genius of human creativity. A watch can be produced by a
machine but until human creativity is there the watch will not be a good one. Therefore, the
intrinsic value of an object is determined by the amount of labor or human creativity needed to
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produce it. The price of an object is determined by supply and demand. However, the value of
the project is determined by the labor time needed for its production.
iv. Theory of Surplus Value

This theory is based on the labor theory of value, which is Marx‘s most important discovery.
Capitalism enslaves the proletariat because people have to work to survive while the capitalist
has a monopoly on the means of production. Hence the workers must sell their labor at whatever
price the capitalist will pay. The capitalists will pay their workers only subsistence wages just
enough to feed themselves and their families because that much is necessary to bring them back
to work the next day. Thus the capitalists pay only meager wages regardless of how much value
they may produce. The capitalists by this method force workers to produce an excess, or surplus
value, and they keep that sum for themselves as profits. Actually, this surplus value belongs to
the labors. But since it is not given to them, the capitalists are exploitative. They are parasites
that live by sucking the economic lifeblood of the proletariat and must be erased from the society
when the proletariat takes over. Marx did not oppose capital as such but he rejected the capitalist.
He did not condemn profit, he opposed private profit. He knew that capital was necessary for
production, but he rejected the notion that it should be controlled by private individuals. Capital
was created by all and it should be owned by all.
Marx certainly did not oppose creating surplus value to be used to invest in increased
productivity. What he argued to was that private citizens should not be allowed to monopolize
the means of production and use that power to force workers – the creators of value – to
surrender their goods in order to survive. In other words, no one should be allowed to profit from
the labor of another.
Marxism characterizes capitalism as the private ownership of the means of production and the
existence of wage labour. It believes that capitalism is driven by capitalists striving for profit and
capital accumulation in a competitive market economy. Labour has been disposed and has
become a commodity that is subject to the price mechanism. In Marx‘s view these two key
characteristics of capitalism are responsible for its dynamic nature and make it the most
productive economic mechanism yet. Although its historic mission is to develop and unify the
globe, the very success of capitalism will speed up its passing. The origin, evolution, and
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eventual demise of the capitalist mode of production are, according to Marx, governed by three
inevitable economic laws.
The first law, the law of disproportionality, entails a denial of Say‘s law, which (in
oversimplified terms) holds that supply creates its own demand so that supply and demand will
always be, except for brief moments, in balance. Say‘s law maintains that an equilibrating
process makes overproduction impossible in a capitalist or market economy. Marx, like John
Maynard Keynes, denied that this tendency toward equilibrium existed and argued that capitalist
economies tend to overproduce particular types of goods. There is, Marx argued, an inherent
contradiction in capitalism between its capacity to produce goods and the capacity of consumers
(wage earners) to purchase those goods so that the constantly recurring disproportionality
between production and consumption due to the ‗anarchy‘ of the market causes periodic
depressions and economic fluctuations. He predicted that these recurring economic crises would
become increasingly severe and in time would impel the suffering proletariat to rebel against the
system.
The second law propelling the development of a capitalist system, according to Marxism, is the
law of the concentration (or accumulation) of capital. The motive force of capitalism is the drive
for profits and the consequent necessity for the individual capitalist to accumulate and invest.
Competition forces the capitalists to increase their efficiency and capital investment or risk
extinction.
Section Three: The International Dependency Revolution
This section will discuss the theories under the international dependence revolution. During the
1970‘s, international dependence model gained increasing support especially among Third
World intellectuals as a result of a growing disappointment with the modernization theories. This
is because these are theories of underdevelopment. Within this general approach, there are three
major streams of thought. Accordingly, this section is further divided in to three sub-sections.
The dependency theory and its theoretical viewpoints on development will be explained in the
first sub-section. The second sub-section is about the false paradigm model and its views on
development. The last part is about the dualistic-development model.
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2.3.1 The Dependency Theory

 Basic departures of dependency theory from modernization theory
Whereas the modernization sets itself to theorize and explain as to what make the North rich and
what the South has to do to become rich, the task of dependency theory is to give explanations as
to what made the North rich and what kept the South poor. The dependency theory tries to
analyze and explain the extent to which the political economies of the South have been exploited
and by a global economy dominated by the advanced capitalist countries. The principal tenet of
the dependency theory is that underdevelopment is not a stage on the road to a capitalist society,
but a condition or symptom of capitalist domination.
 Focuses of the dependency theory
The dependency theory focuses on the unequal economic and political exchange that takes place
between the developed capitalist countries (described as the ‗core‘) and the South (described as
the ‗periphery‘). Proponents of this theory strongly believe that the economies of the periphery
are conditioned by and dependent up on the development and expansion of the economies of the
core. The cause of the backwardness of the periphery is the dynamics and contradictory growth
of the world‘s capitalist system. Whenever there is growth in one part of the world, it is
compounded by backwardness of the other. This is the contradiction in the growth of world
capitalist system. Just as development in one part of the world goes hand in hand with
underdevelopment in another, so underdevelopment in the periphery has contributed to further
development of the core.
2.3.2 Critiques of dependency theory against the modernization theory

The dependency theory challenges the most fundamental assumptions of the modernization
theory. The modernization theory believes that some people are destined to develop, whereas
others are destined to be poor. But this assumption is refuted by dependency theory in the sense
that underdevelopment does not result from some original state of affair. The same world
historical process that enabled the North to develop has also underdeveloped others.
The dependency theory also rejects the claim that the peripheries should follow the same path of
development pursued by the core. It is argued that there were particular political and economic
conditions that enabled the core to industrialize which was based on the domination and
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exploitation of natural and human resources in the West colonies. Whereas, the core
development was based up on expanding resource bases in the colonies, societies of the
periphery are confined with very limited resource base for development. The process of
colonialism integrated the periphery into the world division of labor by which the major function
of the South remained in the production of raw materials for the European industries. This had
facilitated industrialization in the core at the expense of the periphery.
Assumptions shared by many dependency theorists
There are many perspectives that are included in the dependency theory. But certain ideas that
are common to the majority of the proponents of dependency theory are the following.
 Underdevelopment is closely connected with the expansion of industrialized capitalist

countries.
 Development and underdevelopment are different aspects of the same universal process.
That universal process is the expansion of industrial capitalism and the creation of the
world division of labor. In this division of labor, countries of the periphery are forced to
remain in the production of primary commodities and the core to remain major producers
of manufactured commodities.
 Underdevelopment cannot be considered as the original state of affair. It is something

created by the domination and exploitation of the South by the North.
2.3.3 Relation between the core and the periphery

This has created a dependent relationship between the core and the periphery. This dependence
has three major features. These are:
1. The technological dependence: Most of the technologies required for development are
produced in the West. The countries of the North determine the price and availability of
these technologies. But most of these technologies are capital intensive and expensive.
The Third world countries have no option except to borrow financial capital to obtain
these technologies. This makes them dependent on external economic forces that are
beyond their control. This ultimately weakens the aspiration of development.
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2. The South relies up on foreign investment for a number of reasons. This is to accelerate
the development process, to access new technologies and to gain new markets. These
have forced countries of the South to adopt export-led economic policies and strategies.
They are also forced to produce cheap food for export, cheap raw materials and cheap
cash crops.
3. The relation of the core and the periphery in neo-colonialism has created an international
division of labor. In this division, the core remains the major producer and exporter of
manufactured goods and the South to remain in the production and export of primary
goods. As a result, there is unequal exchange between these groups of countries. The
terms of trade, therefore always benefits the core at the expense of the periphery. This has
helped the North to become richer and richer and has made the South poorer and poorer
from time to time.
Generally, the dependency theory attributes the existence and continuance of Third World
underdevelopment primarily to the historical evolution of highly unequal North-South
relationships. Underdevelopment is, therefore seen as an externally induced phenomenon.
2.3.4 Dependency theory solution for Third World societies

Some dependency theorists also argue that the only way for the Third World societies to break
out of the circle of underdevelopment is to pursue a policy of import substitution strategy as a
means of autonomous capitalist development. This means developing indigenous industries in
order to prevent the need import manufactured goods. However, efforts to implement a policy of
import substitution have not proved to be successful. Because of this reason, many dependency
theorists asserted that only revolutionary struggles or at least major restructuring of the world
capitalist system are therefore required to free dependent Third World nations from direct and
indirect economic control of Western industrialized nations. Some like Samir Amin advocated a
self-reliant development strategy.
a. The False Paradigm Model
This model of development attributes Third World underdevelopment to faulty and inappropriate
advices provided by well-meaning but often uniformed, biased, and ethnocentric international
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expert advises from developed country assistance agencies and multinational donor
organizations. These experts offer sophisticated concepts and elegant theoretical structures that
often lead to inappropriate or incorrect policies. While in government policy discussions too
much emphasis is given to such concepts and theoretical structures, desirable institutional and
structural reforms are neglected or given only cursory attentions.
b. The Dualistic-development Thesis
Dualism is a concept that represents the existence and persistence of increasing divergences
between the rich and the poor nations and rich and the poor people on various levels.
Specifically, the concept of dualism embraces four key elements. These are:
i. Different sets of conditions, of which some are ‗superior‘, and others ‗inferior‘ can coexist
in a given space. Examples of this element of dualism include the coexistence of modern
and traditional methods of production in urban and rural sectors.
ii. This coexistence is chronic and not merely transitional. The international coexistence of
wealth and poverty is not simply a historical phenomenon that will be rectified in time.
iii. Not only do the degree of ‗superiority‘ or ‗inferiority‘ fail to show any signs of
diminishing, but they even have an inherent tendency to increase from time to time.
iv. The interrelations between the ‗superior‘ and the ‗inferior‘ elements are such that the
existence of the superior element does little of nothing to pull up the inferior element, let
alone trickle-down to it. In fact, it may actually serve to push it down to develop its
underdevelopment.
2.3.5 Critical Comments on International Dependency Revolution

The international dependency revolution has been enthusiastically by scholar of Third World.
This school of thought suggested that underdevelopment is not the fault of the least developed
countries. It is rather the problem of foreign domination and exploitation. The dependency theory
in particular helped to the redefinition of the concept of economic development to have a wider
perspective. Whereas the modernization theories focused on economic growth, the dependency
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theories give emphasis to the importance of the redistribution of economic wealth and social
justice. Important pillars of the western establishments like the World Bank reoriented their
focus on growth and redistribution which has never existed in their activities.
Despite such praises, the different theories of the international dependency school of thought are
criticized. Among the dominant criticisms, the following are the major ones.
1. These theories attributed all the Third World‘s problems to the external economic factors.
They have never been in-ward looking.
2. Modernization theories have always been optimists about the possibilities of development
in the South. But theories within the International dependency theory school of thought
have remained pessimists about the possibilities of development in the South. Actually
they have their own reasons. Andre GunderFrank for example argued that Third World
nations produce non-industrial goods and ruled by unrepresentative governments; they
are doomed to continue to be backward.
Section Four: The Neo-Liberal Counterrevolution
This section will discuss the neo-liberal economic doctrine and assesses its relevance to the
situation of the economies of the Third World countries. It explains neo-liberal counterrevolution
as an economic theory; analyzes the influence of this theory on economies of Third World
countries; identify the policy prescriptions provided by this theory to bring about economic
development.
2.4.1 An Overview of Neo-Liberal Counterrevolution

How the neo-liberal counterrevolution doctrine came about
The establishment of neo-liberalism as the new development orthodoxy is part of a profound

shift in power in the global political economy. The economic liberalism that had become the
dominant global discourse of development after the industrial revolution was regarded with great
skepticism. The loss of faith in economic liberalism was also a crisis of capitalist hegemony, in
which the fundamentals upon which capitalism depended were challenged and denied.
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After the last quarter of the 20th Century, however, liberal principles were reasserted. The re-
imposition of the liberal principles-or neo-liberal revolution was accompanied by a restructuring
of the relationship between capital and the state, and between the state and society, with the aim
of restoring the unregulated operation of the market forces.
Major argument of the neo-liberal counterrevolution
The central argument of the neo-liberal counterrevolution is that underdevelopment results from
poor resource allocation due to incorrect pricing policies and too much government intervention.
Many writers of this school of thought like Peter Bauer Deepak Lal and Ian little argue that it is
this very state intervention in economic activity that slows the pace of economic growth.
Adopting free market policies will guide efficient resource allocation and stimulate economic
development. Liberalization (opening up) of national market draws additional domestic and
foreign investment and thus increases the rate of capital accumulation, which is important for
economic development. They argue that by permitting free market to flourish, privatizing state
owned enterprises, promoting free trade and export expansion, attracting investors, and avoiding
the plethora of government intervention and regulation, both economic efficiency and economic
growth will be stimulated.
It was then possible by the 1990 for the World Bank to claim a consensus in favor of market-
friendly policies. This new doctrine overturns the assumptions from which development studies
emerge that domestic and international policies that worked against market forces were essential
to bring about development. It virtually abolishes the idea of development as a specific concern,
in favor of a universal set of prescriptions applied to developing and developed economies alike.
The role of the government as envisioned by the neo-liberal counterrevolution
This economic doctrine assigns governments (states) having a limited economic role. The theory
argues that the state should provide certain fundamental public goods such as police protection,
national defense, judicial and educational services, and physical infrastructures (road, railways,
airports, etc.) when only when the private capital is incapable of providing these services. The
state otherwise should have a secondary role.
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The theory believes that most Third World governments injured their economies by moving far
beyond these limited roles, i.e. governments excessively intervene in the economy. Free market
forces should determine production decisions, and should set prices without government
intervention. Because of the influence this theory has, governments of the South have been
forced to liberalize their economies by deregulating the private sector, removing trade barriers,
freeing prices, reducing subsidies to consumers and privatizing state enterprises.
Moreover, the doctrine of neo-liberal counterrevolution believes in international economy and
international trade. It argues that if Third World countries opt to modernize and develop, they
have to take part in the international economy on the basis of their comparative advantage. This
neo-classical belief reaffirms the classical international political economy theory of comparative
advantage advanced by David Ricardo. By so doing, this theory advocated the pursuit of open-
door policies towards trade and investment. It is in this way that Third World countries would
receive technology, capital inputs and finance.
2.4.2 Critiques against the Neo-liberal Counter revolution
Section Five: Evolving Perspectives of Development
2.5.1 Alternative Development

Development is an economic, social and political process which results in a cumulative rise in
the perceived standard of living for an increasing proportion of a population. The theory of
alternative development is concerned with how the living condition of the poor be improved. The
failure of other major theories of development to address poverty and improve the living
condition of the poor necessitates developing another way of thinking. That is alternative
development.
Alternative development begins from criticizing mainstream development theories, which

include the modernization theory, the dependency theory, the Marxian theory and the neo-liberal
doctrine. Most of the theories of development have failed to bring the desired change due to the
following major reasons. These are:
 their emphasis on rapid cumulative growth which was not accompanied by equity
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 Most of them were urban biased because of their single-minded emphasis on

industrialization. But the majority of the poor live in rural areas.
 Because of their emphasis on industrial growth, they are not environmentally friendly.
 They emphasize on the quantities aspect of life, not the qualitative aspect of.
 They also focus on reducing the economic gap between the rich and poor countries.
Reducing the gap between the rich and poor people within the society is ignored.
Alternative development is an attempt to come up with new humanistic, people-centered, and

pro-poor development thinking as a response to these failures. Alternative development places
high emphasis on people‘s autonomy, empowerment, local self-reliance, environmental
sustainability and participatory democracy. By so doing, alternative development is concerned
with improving the quality of living of the poor by empowering the poor. It is also concerned
with introducing alternative development practices and redefining the goals of development so
that development is geared toward improving the qualitative aspect of life.
Alternative development has a multiplicity of different approaches. These approaches have been
popular in different policy decisions and in different international organizations. These
approaches include:
 Redistribution growth
 Basic needs strategy
 Human development
 Women in development/Gender in development
 Sustainable development
i. Redistribution Growth
The World Bank was a key advocator of this approach. The Bank made an assessment that there
had been growth, rise in productivity, higher growth rate per capita GNP in underdeveloped
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countries. In spite of this growth, however, poverty and inequality have not been changed. Those
who were poor remained poor and even much poorer. Because of this, the World Bank began to
advocate a redistribution growth strategy.
Redistribution growth strategy involves identification of who are the poor and where are they,
and formulation of policy packages specifically targeting the poor, particularly the rural poor.
The adoption of a policy of integrated rural development package is one manifestation of the
redistribution growth strategy.
Redistribution growth is an incremental approach dictating that resources should be diverted to

the poor by trying to increase their productive capacity so that their income would rise and by
providing socio-economic services which the poor cannot afford to buy like education.
ii. Basic Needs Strategy

The redistribution growth strategy was replaced by a basic needs strategy because it did not bring
about changes as expected. The basic needs approach has the idea that development has to focus
on the satisfaction of basic needs. Institutions like International Labor Organization (ILO) had
been advocating this approach. According to the ILO classification, basic needs involve two
major elements. These are:
 The satisfaction of minimum requirements of food, cloth and shelter
 The satisfaction of essential services like pure drinking water, education, health, public
transport, etc…
In addition to these elements, human rights like civil and political, and socio-economic rights
(like land ownership right) of citizens were included. There was recognition that there has to be
empowerment in decision making of groups who are socially marginalized like women.
iii. Human Development

It is an approach developed by a Pakistan economist called Muhbud Ul Haq who was once the
head of the UNDP. This approach argues that development as a practice has to focus on
increasing human capacity (potential). To measure human development, the proponents of
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human development approach came up with a measurement called Human Development Index
(HDI). This measurement is based on human development indicators like life expectancy,
literacy rates and purchasing power of the people.
iv. Women in Development/Gender in Development

These approaches focus on the role of gender in socio-economic development. They argue that
the contribution of women in socio-economic development is totally ignored. Therefore, the
contributions of women in development activities have to be added in development measures.
Policy packages have to be implemented that focus on the contribution of women in
development.
v. Sustainable Development
Sustainable Development enters the stream of development theories by introducing concerns for
the natural environment and the future generations, advocating for environmental protection and
intergenerational equity. There is a realization that development in general and industrialization
in particular have brought about changes in the conditions of the natural environment. Production
is expensive and consumes a lot. The accelerated development of countries is damaging the
environment in one way or another. Economic growth is being promoted at the expense of the
environment and thereby affecting the future generation. By definition, sustainable development
is a development that meets the needs of the present generation without compromising the
abilities of future generations to meet their own needs (World Commission, 1987).
Nowadays, many argue that if all countries become industrialized, the planet earth does not have
the capacity to support such development. Therefore, development has to take into consideration
the environment for future generations. There should not be development at the expense of future
generations.
Generally, the strength of alternative development is its regard for local development and social
agency from grassroots groups and social movements to non-governmental organizations
(NGOs). The most important elements of alternative development are participation and
empowerment.
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2.5.2 Post-Development
Post-development is a criticism of development and a development theory arising in the 1980s
that holds that all 'development' is a reflection of Western/Northern hegemony over the rest of
the world. It criticizes the idea and discourse of development. Some of the notable contributors
include but not limited to Ivan Illich, Arturo Escobar, and Gustavo Esteva.
The logic behind post-development refers to development as both on the ground development
and development theory, and follows as such that development theory is held to be generated by
academia in tandem with political ideology. It means development is both a theory and a practice
or simply a theory in action. The academic-political nature of development theory means it tends
to be policy oriented, problem driven, and efficacious relative to most social theories. On the
ground development is initiated by both governments and NGOs according to the advice of
development theory. But development theory needs to follow framework set in place by
government and political culture. There is then a strong socially constructed aspect to
development theory where Western interests are guiding how that knowledge is generated. This
would mean that development reflects a pattern of Western hegemony. This is what post-
development theorists seek to deconstruct.
What does this mean? Does it sound like post-development is anti-development?
Absolutely not! A post-development approach is not anti-development; rather, it is a political

acknowledgement of the injustices and unequal power relationships of the practice of
development, and a view that development cannot offer sufficient tools for transformation.
Instead, it suggests resistance to globalization provided by grassroots organizations and non-
governmental organizations, alternative forms of livelihood, and local forms of knowledge and
practice.
A number of theorists challenged the very meaning of development. According to them, the way
we understand development is rooted in colonial discourse depicting the North as advanced and
progressive and the South as backward, degenerate and primitive. They point out that a new way
of thinking about development began in 1949 when President Harry Truman declared: ―The old
imperialism—exploitation for foreign profit—has no place in our plans. What we envisage is a
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program of development based on the concepts of democratic fair dealings.‖ While claiming that
the ‗era of development‘ began at this point, post-development theorists do not suggest that the
concept of development was new. What was new was to define development in terms of
escaping from underdevelopment. Since the latter referred to two-thirds of the world, this meant
that most of the world had to define themselves as having fallen into an undignified condition
called underdevelopment and to look outside their cultures for salvation. Development,
according to them, was now a euphemism used to refer to United States hegemony, and it was
ideals and programs from the perspective of the United States and its (Western) European allies
which would form the basis of development everywhere.
Leading members of the post-development school argue that development was always unjust,
never worked, and has now clearly failed. The idea of development stands like a ruin in the
intellectual landscape and it is time to dismantle this mental structure.
To cite an example, they would point how the concept of global poverty is entirely a modern
construct. The idea that we can measure poverty at the level of entire nations and hence label
certain countries as poor on the basis of their GNP (Gross National Product) per capita is quite
new. While in pre-industrial societies, poverty applied to certain individuals and generally did
not carry any implications of personal inadequacy, with the advent of modernity entire nations
and continents were led to believe that they were poor, and in need of assistance, only because
their per capita income was below a universally established minimum.
The assumptions of the post-development thinking
Among the starting points and basic assumptions of post-development is the idea that a middle-
class, ‗Western-style‘ of life and all that goes with it, is not a realistic or a desirable goal for the
majority of world‘s population. In this sense, development is seen as requiring the loss of
indigenous culture, or environmentally and psychologically rich rewarding modes of life.
Formerly satisfactory ways of life become dissatisfying because development changes the self-
perception of people.
Development is also seen as a set of knowledge, interventions and worldviews (in short,
discourses) which are also powers-to intervene, transform and to rule. Related to the concept of
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postcolonial criticisms, post-development is, above all, a critique of the standard assumption
about progress as to who possesses the key to it and how it may be implemented.
Post-development also challenges the notion of a single path to development and demands
acknowledgment of diversity of perspective and priorities. The politics of defining and satisfying
needs is a crucial dimension of development thought, to which the concept of agency is central.
In other words, who voices development concerns, what power relations are played out, how do
development experts‘ (World Bank, IMF officials, etc.) interests rule the development priorities,
and which voices gets excluded as a result? Post-development makes an attempt to overcome
inequality by opening up spaces for the agency of non-Western peoples.
Note that the proponents of post-development do not deny the need for change. Post-
development does not deny the need for change. What they argue is that in order for change to be
undertaken differently, it needs to be conceived literally in different terms. While social change
has probably always been part of the human experience, it was only within the European
modernity that ‗society‘, i.e. the whole way of life of people, was open to empirical analysis and
made the subject of planned change. And while communities in the Third World may find that
there is a need for some sort of organized or directed change-in part to reverse the damage done
by development-this undoubtedly will not take the form of designing life or social engineering.
In this long run, this means that categories and meanings have to be redefined.
Some suggestions to be done directly
Some admit that it may be true that majority of people whose life has in fact greatly deteriorated
do want change. But the answer they suggest is not development but the ―end of development.‘
The end of development should not be seen as an end to the search for new possibilities of
change, for a relational world of friendship, or for genuine processes of regeneration able to give
birth to new forms of solidarity. It should also mean that the inhumane and the ultimately
destructive approach to change are to be over. It should represent a call to the good people
everywhere to think and work together.
Critics have complained that post-development is not really beyond or outside of development
discourses. Post-development is merely the latest version of a set of criticisms that have long
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been evident within writing and thinking about development. Development has always been
about choices, with losers, and winners.
There are a number of more fundamental objections to post-development school. The first is that
it overstates its case. For, to reject all development, is also seen as rejection of the possibility for
material advancement and transformation. Or it is to ignore the tangible transformations, in life
chances, health and material well-being that has been evident in parts of the Third World.
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Unit Three
Models/Strategies of Economic Growth

This part of the course discusses two contending models of economic growth. These are
Balanced Growth Model and Unbalanced Growth Model. Debates and theories that surround
these models have aimed at devising approaches or strategies that may help overcome the
development challenges of poor economies like that of Ethiopia. Just like a suitable strategy is
designed in the defense authorities for winning a war, in the same way development strategy is
required by the government for solving the problems of poverty, unemployment and
inequality on one hand and accelerating development on the other. Suitable development
strategy aims at effective and optimum use of available resources (human, material and natural
resources).
Accordingly, this unit is divided into two major sections. The first section elaborates the strategy
of balanced growth and its theoretical standpoint. It discusses the advantages that can be
achieved if poor countries pursue a balanced growth strategy. The second section discusses the
unbalanced growth strategy and its benefits if followed by poor countries.
Section One: Balanced Growth Model/Strategy
3.1.1 The Essence of Balanced Growth Model/strategy

Balanced growth is not a static process. It has different interpretations. In one context, balanced
growth may mean investment in the depressed sector of the economy, while in other context it
may imply harmonious development of different sectors. Planning with balanced growth
indicates that all sectors of the economy will expand in the same proportion so that consumption,
investment and income will grow at the same rates.
The development process in underdeveloped countries is very much hindered by vicious circles
of poverty. By vicious circles, Ragnar Nurkse, an Economist, means a circular assemblage of
forces tending to act and react upon one another in such a way as to keep a country in a state of
poverty. According to Nurkse, vicious circle of poverty adversely affects the accumulation of
capital. The forces responsible for deficiency of capital are small capacity to save, low level of
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income and low productivity. Deficiency of capital leads to the small capacity to save and vise-
versa. Thus, the vicious circle is complete. The underdeveloped countries however would not
like to remain forever in the state of underdevelopment. The question is how to break the vicious
circle. This can be addressed through a series of capital investment in various industries/ sectors.
That is through balanced growth strategy.
What does balanced growth involve?
This growth strategy recognizes the significance of economic interdependence. The growth and
development of various sectors is not possible in isolation. Various segments of the economy
should grow and develop in relation to each other. This strategy aims at doing something
everywhere (i.e. in every firm/sector/region). Resources will be thinly distributed among the
different sectors of the economy. The approach is economy wide growth. It also advocates
capital widening. All sectors firms/regions will get more or less the same amount of resources.
This is done to maximize equity and social welfare and minimize social costs.
The balanced growth strategy suggests investment in diversified feeds. To the extent possible,
this investment should be inclusive so as to increase the scope of economic activities. Moreover,
it also suggests labour intensive techniques of production. This is believed to create employment
and social productivity. The strategy envisages that different firms/sectors/regions grow at
different rates, but in a union and incomplementary way. Firms/sectors/regions grow at different
rates because the return to investment is different in different sectors or locations.
The balanced growth strategy also suggests regional or spatial planning for the depressed
regions, and ethnic and economic groups. To this end, the strategy recommends that there should
be social accountability for production, consumption and distribution. The government is
responsible for increasing production, consumption and distribution.
What are the determinants of balanced growth model?
The implication of balanced growth strategy is generally determined by a variety of factors such
as availability of resources, level of technology, degree of balance prevailing among the
different sectors, socio-economic objectives of development accepted by the people and other
institutional factors. Under balanced growth a series of capital investment in different industries
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is essential for breaking the vicious circle. The question is which sector or industry should be
given preference in the matter of investment allocation. In this context, it has been suggested that
investment should be made in the growing sector in an economy.
This would create external economies which would provide incentive to other productive
activities. The chain of continuous investment would ultimately bring out transformation in the
economy. Growth in one sector generates external economies for other sectors, with the result
that sectors will become complementary. But it should be remembered that the selection of a
growing sector is not an easy task. It is difficult to decide whether agriculture or industry, human
capital or material capital, internal trade or external trade should be given priority in investment
allocation.
Achieving complementarity in an economy
Complementarity is an essential and vital feature of balanced development. Now let us see how it
can be achieved by taking agriculture and industry in to consideration.
The economic history of industrialized countries reveals that a prosperous agriculture forms the
basis of industrialization. Agriculture provides necessary raw material for manufacturing sector.
It provides food for the growing urban population. Agricultural surpluses can be mobilized for
investment in non-agricultural sectors. The rising income of the rural population expands
demand for manufactured and durable goods. All these bring about structural transformation in
rural economy. The developing rural economy becomes capable of exporting farm products and
earns foreign exchange to meet the initial requirement of industrialization. Domestic market
expands; new methods of production, new skills, new investment opportunities and new
organizational abilities develop. All these create a favorable climate for industrial expansion.
This is how the prosperous agriculture supports and sustains the expanding industrial activities.
In other words, development of agricultural sector is an essential pre-requisite for industrial
growth.
How can the industrial sector help the development of agriculture?
It is well-known that underdeveloped countries are overpopulated and this phenomenon creates a
tremendous burden on agriculture. Growth of industrial activities helps in reducing this burden
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by absorbing surplus rural population. Employment opportunities expand and income rises which
raises the living standard of rural population. Moreover, the manufacturing sector supplies
various agricultural inputs like pumping sets, harvesters, fertilizer and agricultural machinery
which help in development of agriculture. In nutshell, agricultural improvements are possible
through industrial development, technical base and essential infrastructure. Hence, simultaneous
development of agriculture and industry is an essential pre-requisite for balanced growth. This
development should be ensured by development planning.
How to ensure balance between agriculture and industry
Agriculture and industry should be considered as integrated parts of an economy. And hence,
development planners should ensure the balance between agriculture and industry. It might be
difficult to suggest a uniform pattern for balance between agriculture and industry for all
underdeveloped countries. Yet, the following guidelines could serve as the basis for ensuring
balance between the two.
a. The planners should not concentrate resources on the development of one particular
sector. The resources should be allocated among the different sectors in a manner so as to
maximize the social welfare.
b. While drawing up the patterns of priorities, planners should take into account the local
conditions such as availability of resources, level of technological development,
institutional factors, level of development already attained and other similar factors. The
optimum combination of such factors could ensure a balance between agriculture and
industry. The experience of the developed countries should also be taken into account by
planners.
c. It is generally observed that underdeveloped countries have surplus rural population. The
transference of this surplus rural labor to the urban sector would help in the development
of manufacturing industries.
Similar consideration should be made by development planners to ensure balance between other
sectors of the economy.
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Essential Conditions for Balanced Growth
What are the essential conditions for this balance?
In the initial stages of development, it might be difficult to bring out a balance among the
different sectors when they compete for limited resources. Yet, the following conditions are
essential for achieving and maintaining a balance among different sectors of the economy.
1. State Intervention- The logic of balanced growth cannot be given a practical shape
without state intervention. The state can enforce and maintain law and order. It can
mobilize necessary funds through taxes, borrowing, and deficit financing to meet
financial requirements of balanced growth. State can encourage and stimulate domestic
private investment. It can also regulate the economy through its fiscal, monetary and
other measures. Moreover, state can undertake and promote welfare activities for the
creation of human capital.
2. Formulation and Implementation of plans- Formulation and implementation of

development plans is another pre-requisite for achieving and maintaining consistency and
harmony among the different sectors. Planning is an instrument of realizing socio-
economic objectives of balanced growth.
3. Coordination among different departments of the government- Planning only

suggests the way for implementing the various development programs, but the actual
execution is done by the different government departments. Balanced growth requires
integration of different development policies, so that all sectors move in balance. This,
however, requires cooperation, coordination and proper understanding among various
government departments and state agencies.
4. Public cooperation-This is essential not only for political stability but also for economic
advancement. It is both the lubricating oil for planning and the petrol of economic
development; it is a dynamic force that almost makes all things possible. People should
be made partners in development. This is because every development activity would
promote the social and economic welfare of people.
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Generally, the strategy of balanced growth aims at a direct attack on poverty through societal
support. In view of this, agriculture and rural development receive high priority in order to
benefit the largest section of the society. The entire process of development is guided by
planning machinery. Resources should be distributed fairly. That needs planning. This implies
that balanced growth is impossible without government intervention.
3.1.2 Proponents of Balanced Growth
There are numerous economists who support the strategy of balanced growth. These may
include, among others Ranger Nurkse, Arthur Lewis and François Perronx. Let us see their
economic thought turn by turn.
i. Ranger Nurkse: He believes that if countries adopt a strategy of balanced growth and if all
people participate in the growth process, the following benefits can be achieved.
 Total savings and capital accumulation rise
 No gluts (excess supply) and no shortage of goods and services exist in the
economy.
 Backward and forward linkages are fostered.
 Balanced growth can be managed with less resource. It heavily depends on the
mobilization of local resources.
 Balanced growth strategy breaks the vicious circle of poverty; because it aims at
benefiting the largest section of society.
 Development finance is fairly distributed across sectors and regions. This can lead
to widespread employment and spread of the fruits of development.
ii. Arthur Lewis: He advocated a balanced growth strategy in a manner that labour is utilized to
the maximum. If the productivity of labour is improved in agriculture, then the same work can
be done with fewer people, because the contribution of each labour is high. Then, it is only the
genuinely redundant labour can more to the modern, i.e. distress migration will not occur.
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People migrate to the modern sector up on their own will. Furthermore, he advocated that all
sectors of the economy should grow simultaneously and harmoniously so as to keep a proper
balance between agriculture and industry, between material capital and human capital, between
export and import, etc…
Does it mean all sectors grow equally?
Not necessarily! Balanced growth does not mean equal growth; it rather means proportionate
growth of different sectors dictated by their growth of demand.
3.1.3 Advantages of Balanced Growth Strategy
In addition to the arguments that support the balanced growth model, strategy is of a mixed
blessing. It has both advantages and disadvantages. Let us first see the advantages.
i. Balanced regional development: The doctrine of balanced growth implies that all sectors
of the economy should grow simultaneously and no sector should be discriminated in the
matter of resource allocation. When development of all sectors is taken up by the planning
authorities, it will pave the way for balanced regional development. Development of one or
two sectors would create tension, disharmony and disequilibrium in the various segments of
the economy.
ii. Wide extent of market: Simultaneous development of different sectors would help in the
production of various goods, which in turn would lead to the expansion of demand and the
enlargement of market. Environment of competition would prevail which would result in the
production of quality output.
iii. Division of labor: The strategy of simultaneous investment widens the extent of market.
Wide extent of market leads to a greater division of labor, higher output and quality product.
Division of labor leads to specialization which is essential for promoting export and earning
foreign exchange.
iv. External economies: Balanced growth helps in the creation of external economies, which
are considered essential for rapid economic development. External economies arise due to
interdependence of industries. Different industries support and encourage each other, which
give rise to complementarity of industries.
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v. Creation of social over-head capital: When different industries develop simultaneously,

the governments of less developed countries would be required to provide basic facilities
(transport, credit, electricity, etc…) to encourage the process of industrialization.
vi. Innovations and researches: Balanced growth strategy encourages innovations and
researches in different sectors of the economy. When different industries develop
simultaneously, competition arises. This forces industries to undertake innovations and
researches for reducing cost of production and improving the quality of product. Low cost
of production means low price, which in turn raises the purchasing power and promotes
economic and social welfare of society.
3.1.4 Criticisms against Balanced Growth Doctrine
As it is a mixed blessing for underdeveloped countries, the doctrine of balanced growth is

criticized. The following are some of these criticisms.
1. The simultaneous development of different sectors requires the unevenness of capital and
it is difficult for less developed countries to mobilize necessary capital investment in the
early stages of development because of low savings, unfavorable balance of payment,
market imperfections, etc…
2. Not only capital is deficient, but the supply of other resources is also inadequate for the
implementation of balanced growth. The smooth functioning of this strategy requires
availability of cheap labor, cheap electricity, raw materials, transport facilities, etc…
Technocrats, engineers, and professionals are also required when different industries
develop simultaneously. But these factors are generally in short supply. Under such a
situation, all round development is not possible.
3. The doctrine of balanced growth ignores the cost reduction aspect. In the development
process, the minimization of costs is as important as the maximization of output. The
strategy of development which aims at the maximization of output and ignores the
minimization of cost cannot be considered satisfactory growth model.
4. The doctrine of balanced growth is also criticized that it tends to create inflation in the
initial stages of development. When simultaneous development of different sectors is
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launched, capital investment expands and quantity of money increases. This increase in
money supply raises the level of effective demand. Supply of goods however, lag behind
because of structural obstacles and hence inflation is generated.
5. Balanced growth has a wrong assumption that the doctrine creates complementarity
between industries. But in reality, when new industries get going, the demand for the
products of the old industries would shrink, as the result instead of complementarity,
competition between the new and old industries would start.
6. Because of the above problems, balanced growth is considered as a luxury for

underdeveloped countries. If an underdeveloped country launches ambitious program of
balanced growth with limited resources, imbalance, tension and disequilibrium would
emerge and it might be difficult to maintain balance among different sectors.
Section Two: Unbalanced Growth Model/Strategy
3.2.1 Aspects of Unbalanced Growth Model
Historically speaking, western countries have followed the pattern of unbalanced growth. But the
concept of unbalanced growth has been interpreted in a variety of ways. According to
Hirschman, development is a chain of disequilibria that must be kept alive rather that eliminating
the disequilibrium. If the economy is to be kept moving ahead, the task of development policy is
to maintain tensions, disproportions and disequilibria. The best way to create imbalances and
tensions is to accord priority to the leading sectors in the matter of development and investment
allocations.
The strategy of unbalanced growth aims at doing everything somewhere in a concentrated

manner. This approach is selective. It also advocates capital deepening, i.e. it advocates using
resources in a concentrated and selective manner according to comparative advantage.
Furthermore, it advocates maximizing profits and gains on the principle of comparative
advantage. Resources will be concentrated in those firms/sectors/regions where there is a
maximum return.
What does unbalanced growth suggest?
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This particular growth strategy suggests that there is a need to invest in leading industries /firms
/sectors and locations so as to increase the scale of economic activities. It also suggests capital
intensive techniques of productive. In this case, employment is not an issue that it should take
care of itself. The driving force is higher profit. The strategy also envisages that different
firms/sectors/regions grow at different rates in a competitive way with the dictates of market.
Investors should have an option to invest in those sectors/firms/regions where the return in
higher.
Unlike the balanced growth strategy, unbalanced growth strategy suggests planning at a project
level (i.e. project planning). The concern here is that increasing production, consumption and
distribution will take care of themselves in accordance with the laws of the market.
Generally, the strategy of unbalanced growth aims at creating a self-financing development. To

that end, individuals and communities should finance themselves. It is the profit that should go
to re-investment. Resource allocation will be effected through market forces, where profits are
higher.
3.2.2 Arguments for Unbalanced Growth Strategy
Which sectors of the economy should be given priority in unbalanced growth strategy?
Many economists argue that for achieving rapid economic development, the planners should
concentrate on focal areas which could have the promise of rapid growth. The development of
focal areas would set in motion a chain of reactions which would gradually spread to other
segments of the economy. This obviously infers that planners should make the selection of those
sectors which are most productive. The sectors like power, fuel, transportation, communication,
education, etc…, could generate external economies and facilitate the development process. Such
sectors should be given a priority in the matter of investment allocations.
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What are the arguments for unbalanced growth?
The classical economists implicitly advocated for unbalanced growth strategy, because economic
decisions have to be based on market forces. This strategy should ultimately lead to balanced
growth. This strategy is based on the following arguments:
i. It is based on comparative advantage, i.e. the return per unit cost is higher. The approach
promotes efficiency.
ii. It is within the means, i.e. real and monetary resources will be the basis for decision. In
other words, decisions will be made within the limits of a resource capacity. It is
achievable.
iii. If we pursue this strategy, we are investing in leading firms/sectors with the greatest
locational and cost advantage, i.e. average cost is lower. It enables the societies to be
competitive on the domestic and international market.
iv. If decisions are made on the basis of market forces, real linkages between sectors and
industries will be fostered.
In addition to the above arguments, there are proponents of this strategy. Hirschman, W. W.
Rostow, and Hans Singer are the most prominent, among others. Now, let us see the arguments
of these economists turn by turn.
1. Hirschman
Why are deliberate imbalances in the economy important?
He propounded the theory of unbalanced growth as continuation to balanced growth theory. He

is of the opinion that the best way to accelerate economic development is to create deliberate
imbalances in the economy. He believed that underdeveloped countries are not capable of
developing different sectors simultaneously owing to scarcity of resources and necessary
infrastructure. He argues for unbalanced growth strategy, therefore for the simple reason that
resources are scarce. There is serious shortage of resources, shortage of skilled manpower,
infrastructure, etc. He argues that investment should be not only political, but also based on price
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signals. He contends that tensions and disproportions among sectors and groups are growth
inducting/stimulating factors. These tensions and disproportions allow the government to signal
investment opportunities or investment gaps.
Hirschman argues that investment should be made in strategic and leading sectors. The pattern of
investment would create more investment opportunities, and pave the way for further economic
development. He points out that the development of industrialized countries has been on the
pattern unbalanced growth. Development is the result of a series of investment. The divergent
series of investments are influenced by the social profitability and such investments are
undertaken by the public agencies.
2. W.W. Rostow
Growth poles
Rostow wants growth through leading sectors and industries in specific locations. This will lead
to the emergence of growth poles. Certain area will be concentrated with industries. Once these
growth poles emerge, it will spread out to other areas. Growth will benefit the surrounding
areas. If we construct an infrastructure connecting two growth poles, other areas will benefit.
With the emergence of several growth poles, supplementary and complementary investments as
well as competitive investments will take place within and outside growth poles. This ultimately
leads to balanced growth in the long run. The development of micro, small and medium
enterprises and the provision of services are instrumental to complement the development of
poles so that these growth poles will have a propelling effect.
What is the advantage of investing in leading sectors?
Furthermore, Rostow argues that the productive investment must be made for the development of
the leading sectors of the economy. The development of the leading sectors would ensure a
higher level of output and profit. The reinvestment of profit would further stimulate development
activities and process of development would gain momentum.
According to Rostow, if we focus on big industries/sector in certain locations, this promotes

backward and forward linkages. For him, it big industries/sectors develop, intermediate
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industries/sectors will emerge by way of using the output of the big industries/sectors or
producing inputs for the big industries/sectors. This will lead to the emergence of consumer
industries. Profitability is the driving force in the whole process.
3. Hans Singer
Unbalanced growth is a better strategy to concentrate available resources on types of investment

which help to make the economic system more elastic, more capable of expansion under the
stimulus of expanded market and expanding demand. He supports the strategy of unbalanced
growth for the following reasons.
i. This strategy respects market principles. It enables one to invest in areas where there are
profits and re-investable funds and in areas where economic activities are elastic
(responsive). But he advises that we should not invest lot of resources which do not
benefit society and which do not generate re-investable funds. To the extent possible, any
project should be profitable.
ii. Singer appreciates the principle of comparative advantages. But he recommends that
developing countries should import capital intensive goods at the early stage of their
development and should start profit earning industries. They should also focus on
producing exportable items. In relation to this, he believes that capital intensive techniques
of production can also be used in the competitive international market. To that end,
external loans can be used to the extent possible and as long as investments are profitable.
Why should agriculture receive the priority in the early stage ofdevelopment?
iii. The development of agriculture should receive the priority even if one pursues unbalanced
growth strategy at the early stage of development. This is because the agricultural sector
can serve as market for the industries.
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3.2.3 Advantages of Unbalanced Growth Model
The advantages that could follow from pursuing unbalanced growth pattern are discussed as
follow:
1. Creation of external economies- The strategy of unbalanced growth helps in the

creation of external economies. This pattern of development stresses on the expansion of
capital-goods industries and complementarity between them. This strategy is considered.
2. Self-reliance- The aim of development planning in underdeveloped countries is to

achieve self-reliance in the short run. This development goal can be realized through the
expansion of leading sectors and high rate of capital investment. Both these conditions
are met by the strategy of unbalanced growth.
3. Generation of economic surplus- This strategy aims at the establishment of capital-

goods industries and such industries help in the development of subsidiary industries.
This way a chain of investment takes place and this expand income, output and
employment which result in higher economic surplus. The reinvestment of economic
surplus generates momentum for development process and induces economic activities.
4. Skill Formation- The strategy of unbalanced growth aims at rapid development through
the expansion of investment. Such an investment helps in creating basic facilities like
elementary and technical education, roads, communication, housing, public health,
etc…This facilities promote skill formation, and improve the quality of manpower.
5. Short-term strategy- Unbalanced growth is a short-term strategy of development. The

advantage of this approach is that people in underdeveloped countries get the fruits of
their labor and effort in short period.
6. Practical policy- The strategy of unbalanced growth suggests pragmatic approach of

rapid development. This strategy stresses the setting up of those industries, which have
the promise of maximum total linkage.
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3.2.4 Limitations of Unbalanced Growth
Alike the balanced growth strategy, the unbalanced growth model is also a mixed blessing for
underdeveloped countries. Despite its advantages, it suffers from the following limitations.
i. This growth model does not discuss the degree of imbalance among the various
sectors.
ii. The theory of unbalanced growth suggests the setting up of capital goods industries
for achieving goals of development. But the starting of capital goods industries in the
initial stages of development may not be an easy task for underdeveloped countries
and it might create economic, social and structural obstacles. The theory does not
suggest the way out.
iii. The implementation of unbalanced growth required the availability of certain basic
facilities like raw materials, expertise, power, developed means of transport and
communication, wide extent of markets, etc…Such basic facilities are generally
lacking in less developed countries in the initial stages of development. Lack of these
facilities hampers the successful implementation of unbalanced growth strategy.
iv. It is generally observed that heavy industries have a tendency to concentrate at one
place due to availability of external economies. This creates slums, over-crowding,
health problems, and pollutes the atmosphere of surrounding localities. In this context
it has been suggested that ―it is not wise to keep all your eggs in one basket.‖
v. The unbalanced growth can generate inflation. The strategy can succeed when
effective measures are taken to control inflation.
3.3 Comparing Balanced and Unbalanced Growth Models
Having discussed the two strategies, it would be worthwhile to have a comparative study of
balanced and unbalanced growth. The following are some of the differences between the two
growth models.
1. Balanced growth aims at simultaneous development of all the sectors of the economy,
whereas unbalanced growth suggests the development of only leading and growing
sectors of the economy.
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2. Balanced growth aims at harmony, consistency and balances in the growth rates of
various sectors, whereas unbalanced growth suggests the creation of disharmony,
inconsistency and imbalance in the growth rates of development parameters.
3. The implementation of balanced growth requires huge capital investment for

simultaneous development of various sectors. The implementation of unbalanced growth
requires comparatively less capital as only leading sectors are developed in the first
instance.
4. Balanced growth is a long term strategy as the development of different sectors is

possible in the long period. The objectives of balanced growth are difficult to be realized
in the short period because of stress and strain in the early stages of development. The
unbalanced growth is a short term strategy, as the development of leading sectors is
possible in the short period.
5. The doctrine of balanced growth assumes that the bottlenecks in the form of shortages are
fairly widespread in the economy and as such it suggests the policy of frontal attack for
the minimization and elimination of bottlenecks. Unbalanced growth on the other hand
assumes that bottlenecks are not widely spread in the economy.
6. The balanced growth strategy assumes that all sectors generate external economies,
whereas unbalanced growth assumes that some sectors generate external economies than
others.
3.4 Compromising Views of the Debate between Balanced and

Unbalanced Growth Strategies
The impartial and unbiased view is that there can be no end to the debate on this issue. From
purely economic point of view, there is really no reason to assume that two strategies are
alternatives. The wise approach for economic growth is to have a blend/mixture of the two
growth strategies. We should be pragmatic. Most agree that it is good to treat unbalanced growth
as a means of achieving the ultimate objective of balanced growth. The following points may be
important to consider:
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A. The two growth strategies can be complementary than alternative strategies.

B. Complete balancing is not possible for a number of reasons: resource constraints,
lack of adequate infrastructure, shortage of capital, skilled labour, the unequal
responsiveness of the different sectors, etc... But balancing is important from the
point of view of employment creation, poverty alleviation, income distribution,
human capital development, etc...
C. At the same time, some degree of unbalancing is essential because of resource
constraints, market imperfections etc... So, we need to be selective in the allocation
of scarce resources.
D. Unbalanced growth strategy eventually leads to balanced growth through the
creation of growth poles/centers.
E. Development is not just economic growth. It is also political, social, cultural and
human. So, we cannot postpone agricultural and rural development because it is a
market for the industrial sector. Agricultural and rural development should be made
simultaneously with the development of other sectors.
Unit Four
Population Growth and Economic Development
4.1 World Population Growth through History
What is population?
The term population refers to the total human inhabitants of a specified area, such as a city,
country, or continent, at a given time. Population study as a discipline is known as demography.
It is concerned with the size, composition, and distribution of populations; their patterns of
change over time through births, deaths, and migration; and the determinants and consequences
of such changes. Population studies yield knowledge important for planning, particularly by
governments, in fields such as health, education, housing, social security, employment, and
environmental preservation. Such studies also provide information needed to formulate
government population policies, which seek to modify demographic trends in order to achieve
economic and social objectives.
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Every year, more than 93 million people are being added to the world‘s population of 5.5 billion.
More than 82 million of these additional people per year will be born in Third World Countries.
These increases are unprecedented. But the problem of population growth is not simply a
problem of numbers. It is a problem of human welfare and of development. Rapid population
growth can have serious consequences for the well-being of humanity worldwide. If
development entails the improvement in people‘s levels of living-their incomes, health,
education, and general well-being-and if it also encompasses their self-esteem, respect, dignity,
and freedom to choose, then the really important question about population growth is this: How
does the contemporary population situation in many Third World countries contribute to or
detract from their chances of realizing the goals of development, not only for the current
generation but also for the future generations? Conversely, how does development affect
population growth?
Throughout most of the more than 2 million years of human existence on earth, humanity‘s
numbers have been few. When people first started to cultivate food through agriculture some 12,
000 years ago, the estimated world was no more than 5 million.
The reason for the sudden change in overall population trends is that for almost all of recorded
history, the rate of population change, whether up or down, had been strongly influenced by the
combined effects of famine, disease, malnutrition, plague, and war-conditions that resulted in
high and fluctuating death rates. In the twentieth century, such conditions came increasingly
under technological and economic control. As a result, human mortality (the death rate) is
currently lower than at any other point in human existence. It is this decline in mortality resulting
from rapid technological advances in modern medicine and the spread of modern sanitation
measures throughout the world, particularly within the past 50 years, that has resulted in the
unprecedented increases in world population growth, especially in Third World countries. For
example, death rates in Africa, Asia, and Latin America have fallen by as much as 50% during
the past 30 to 40 years, whereas birthrates have only recently begun to decline.
However, the population growth of developed countries is best explained by what is known as
the demographics transition. The demographic transition attempts to explain why all
contemporary developed nations have more or less passed through the same three stages of
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modern population history. Before their economic modernization, these countries for centuries
had stable or very low growing populations as a result of a combination of high birthrates and
almost equally high birth rates. This was stage 1. Stage 2 began when modernization, associated
with better public-health methods, healthier diets, higher incomes, and other improvements, led
to a marked reduction in mortality that gradually raised life expectancy from under 40 years to
over 60 years. However, the decline in death rates was not immediately accompanied by a
decline in fertility. As a result, the growing divergence between high birth rates and falling death
rates led to sharp increases in population growth compared to past centuries. Stage 2 thus marks
the beginning of the demographic transition (the transition from stable or slow-growing
populations first to rapidly increasing numbers and then to declining rates). Finally, stage 3 was
entered when the forces and influences of modernization and development caused the beginning
of a decline in fertility; eventually, falling birthrates converged with lower death rates, leaving
little or no population growth.
In short, population growth today is primarily the result of a rapid transition from a long
historical era characterized by high birth and death rates to one in which death rates have fallen
sharply but birthrates, especially in developing countries, are only just beginning to fall from
their historical high levels.
4.2 The Causes of High Fertility in Developing Countries
4.2.1 The Malthusian Model

Almost 200 years ago, the British economist Thomas Malthus put forward a theory about the
relationship between population growth and economic development that survives till today.
Robert Malthus raised an alarm about population growth in the late 18th century.
An Essay on the Principle of Population (1798) is arguably one of the most influential books
ever written. Writing in 1798 in his Essay and drawing on the concept of diminishing returns,
Malthus postulated a universal tendency for the population of a country, unless checked by
dwindling food supplies, to grow at a geometric rate, doubling every 30 or 40 years. At the same
time, because of diminishing returns to the fixed factors, land, food supplies could expand only
at a roughly arithmetic rate. Because the growth in food supplies could not keep pace with the
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burgeoning population, per capita incomes (defined in an agrarian society simply as per capita
food production) would have a tendency to fall so low as to lead to a stable population existing
barely at or slightly above the subsistence level.
Modern economists have given a name to the Malthusian idea of a population inevitably forced
to live at subsistence levels of income. They have called it the low-level equilibrium population
trap or more simply, the Malthusian population-trap.
According to the neo-Malthusians, poor nations will never be able to rise much above their
subsistence levels of per capita income unless they initiate preventive checks (birth control) on
their population growth. In the absence of such preventive checks, Malthusian positive checks
(starvation, disease, wars) on population growth will inevitably provide the restraining force.
Malthus therefore contended that the only way to avoid this condition of chronic low levels of
living or absolute poverty was for people to engage in ‗moral restraint‘ and limit the number of
their children. Hence, we might regard Malthus, indirectly and inadvertently, as the father of the
modern birth control movement.
Malthus' theory of population is his best-known contribution: Passion between the sexes, unless
checked by human misery, leads to a continual growth in population. Positive checks to
population growth include "... war, disease, hunger, and whatever ... contributes to shorten the
duration of human life." Preventative checks include abstinence from sexual relations,
continence within marriage, and/or delay of marriage.
4.2.2 Criticism of the Malthusian Model

The Malthusian population trap provides a simple and in many ways appealing theory of the
relationship between population growth and economic development. Unfortunately, it is based
on a number of simplistic assumptions and hypotheses that do not stand the test of empirical
verification. We can criticize the population trap on two grounds.
First, and most important, the model assumes away or ignores the enormous impact of
technological progress in offsetting the growth-inhibiting forces of rapid population increases.
The history of modern economic growth has been closely associated with rapid technological
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progress in the form of a continuous series of scientific, technological, and social inventions and
innovations. While Malthus was basically correct in assuming a limited supply of land, he did
not-and in fairness could not at that time-anticipate the manner in which technological progress
could augment the availability of land by raising its quality (its productivity) even though its
quantity might remain roughly the same.
The second basic criticism of the trap focuses on its assumption that national rates of population
increase are directly (positively) related to the level of national per capita income. According to
this assumption, at relatively low levels of per capita income, we should expect to find
population growth rates increasing with increasing per capita income. But research on Least
Developed Countries (LDCs) indicates that there appears to be no clear correlation between
population growth rates and levels of per capita income among Third World nations. As a result
of modern medicine and public health programs, death rates have fallen rapidly and have become
less dependent on the level of per capita income. Moreover, birth rates seem to show no
definable relationship with per capita income levels.
Our conclusion, therefore, is that it is not so much the aggregate level of per capita that matters
for population growth but rather how that income is distributed. It is the level of household
income, not the level of per capita income that seems to matter most. The social and economic
institutions of a nation and its philosophy of development are probably greater determinants of
population growth rates than aggregate economic variables and simple models of
macroeconomic growth.
The Malthusian and neo-Malthusian theories is therefore rejected as applied to contemporary

Third World nations on the following grounds
 They do not take adequate account of the role and impact of technological progress
 They are based on a hypothesis about a macro relationship between population growth
and levels of per capita income that does not stand up to empirical testing
 They focus on the wrong variable, per capita income, as the principal determinants of
population growth rates. A much better and more valid approach to the question of
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population and development centers on the macroeconomics of family-size decision

making in which individual, and not aggregate, levels of living become the principal
determinant of a family‘s decision to have more or fewer children.
4.3 The Consequences of High Fertility: Some Conflicting Opinions
What are the Consequences of rapid population growth?
For many years, there has been an ongoing and lively debate among development economists
and other social scientists about the seriousness of the consequences of rapid population growth.
The following summarizes some of the main arguments for and against the idea that the
consequences of rapid population growth lead to serious development problems. It then informs
the basis for considering whether some consensus can be reached so that specific policy goals
and objectives can be postulated.
4.3.1 Population Growth Is Not a Real Problem

We can identify three general lines of argument on the part of people who assert that population
growth is not a cause for concern
 The problem is not population growth but rather other issues
 Population growth is a false issue deliberately created by dominant rich country agencies
and institutions to keep LDCs in their underdeveloped, dependent condition
 For many developing countries and regions, population growth is in fact desirable
A. Some Other Issues
Many knowledgeable people from both rich and poor nations argue that the real problem is not
population growth per se but one or all of the following four issues:
i. Underdevelopment
If correct strategies are pursued and lead to higher levels of living, greater esteem, and expanded
freedom, population will take care of itself. Eventually, it will disappear as a problem, as it has in
all of the present economically advanced nations. According to this argument, underdevelopment
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is the real problem, and development should be the only goal. With it will come economic
progress and social mechanisms that will more or less automatically regulated population growth
and distribution. As long as the vast majority of people in Third World countries remain
impoverished, uneducated and physically and psychologically weak, the large family will
constitute the only real source of social security (i.e parents will constitute to be denied the
freedom to choose a small family if they so desired). Proponents of the underdevelopment
argument then conclude that birth control programs will surely fail, as they have in the past,
when there is no motivation on the part of poor families to limit their size.
ii. World Resource Depletion and Environmental Destruction
Population can only be an economic problem in relation to the availability and utilization of
scarce natural and material resources. The fact is that developed countries with less than one-
quarter of the world‘s population, consume almost 80% of the world‘s resources. For example,
the average North American or European consumer uses up, directly and indirectly, almost 16
times as much of the world‘s food, energy, and material resources as his or her counterpart in
Third World countries. In terms of the depletion of the world‘s limited resources, therefore, the
addition of another child in the developed countries is as significant as the birth of 16 additional
children in the underdeveloped countries. According to this argument, developed nations should
curtail their excessively high consumption standards instead of asking less developed nations to
restrict their population growth. The latter‘s high fertility is really due to their low levels of the
―over consumption‖ of the world‘s scarce resources by rich nations. This combination of rising
affluence and extravagant consumption habits in rich countries and among rich people in poor
countries should be the major world concern, not population growth.
iii. Population Distribution
According to this third argument it is not the number of people per se that is causing population
problems, but their distribution in space. Many regions of the world (e.g. parts of Sub-Saharan
Africa) and many regions within countries (e.g. the northeast and Amazon regions of Brazil) are
in fact under-populated in terms of available or potential resources. Others simply have too many
people concentrated in too small an area (e.g. central Java or most urban concentrations in
LDCs). Governments should therefore strive not to moderate the rate of population growth but
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rather to reduce rural-urban migration and to bring about a more natural spatial distribution of
the population in terms of available land and other productive resources.
iv. Subordination of Women
Women often bear the disproportionate burdens of poverty, poor education, lack of jobs, and
limited social mobility. In many cases, their inferior roles, low status, and restricted access to
birth control is manifested in their high fertility. According to this argument, population growth
is a natural outcome of women‘s lack of economic opportunity,
B. Deliberately Contrived False Issue
The second main line of argument denying the significance of population growth as a major
development problem is closely allied to the neocolonial dependence theory of
underdevelopment. Basically, it is argued that the frenetic over-concern in the rich nations with
the population growth of poor nations is really an attempt by the former to hold down the
development of the latter in order to maintain an international status quo that is favorable to their
self-interests. Rich nations are pressuring poor nations to adopt aggressive population control
programs even though they themselves went through a period of sizable population increase that
accelerated their own development processes.
A radical neo-Marxist version of this argument views population control efforts by rich countries
and their allied international agencies as racist or genocidal attempts to reduce the relative or
absolute size of the poor, largely nonwhite populations of the world who may someday pose a
serious threat to the welfare of the rich, predominantly white societies. Worldwide birth control
campaigns are seen as manifestations of the fears of the developed world in the face of a possible
radical challenge to the international order by the people who are its first victim.
C. Population Growth is Desirable
A more conventional economic argument is that of population growth as an essential ingredient

to stimulate economic development. Larger populations provide the needed consumer demand to
generate favorable economies of scale in production, to lower production costs, and to provide a
sufficient and low cost labor supply to achieve higher output levels. Population ―revisionist‖
economists of the 1980s neoclassical counterrevolution school like Julian Simon and Nicholas
Eberstadt argue, for example, that free markets will always adjust to any scarcities created by
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population pressures. Such scarcities will drive up prices and signal the need for new cost-saving
production technologies. In the end, free markets and human ingenuity (Simon‘s ―genius‖ as the
―ultimate resource‖) will solve any and all problems arising from population growth. This
revisionist view point was clearly in contrast with the traditional ―orthodox‖ argument of the
1950s to 1970s that rapid population growth had serious economic consequences that, if left
uncorrected, would slow economic development.
At the other end of the political spectrum, it has been argued by some Third World neo-Marxist
pronatalists that many rural regions in developing countries are in reality under-populated in the
sense that much unused but arable land could yield large increases in agricultural output if only
more people were available to cultivate it. Many regions of tropical Africa and Latin America
and even parts of Asia are said to be in this situation. With respect to Africa, for example, some
observers have noted that many regions had larger populations in the remote past than exist
today. Their rural depopulation resulted not only from the slave trade but also from compulsory
military service, confinement to reservations, and the forced-labor policies of former colonial
governments. For example, the sixteenth-century Congo Kingdom is said to have had a
population of approximately 2 million. But by the time of the colonial conquest, which followed
300 years of slave trade, the population of the region had fallen to less than one third of that
figure. Today‘s Zaire has barely caught up to the Sixteen-century numbers. Other regions of
Western and eastern Africa provide similar examples- at least in the eyes of advocates of rapid
population growth in Africa.
In terms of ratios of population to arable land (land under cultivation, fallow land, pastures, and
forests), Africa south of the Sahara is said by these supporters of population expansion to have a
total of 1.4 billion arable hectares. Land, actually being cultivated amounts to only 170 million
hectares, or about 1 hectare per rural inhabitant. Thus only 12% of all potential arable land is
under cultivation, and this very low rural population density is viewed as a serious drawback to
raising agricultural output. Similar arguments have been expounded with regard to such Latin
American countries as Brazil and Argentina.
Three other non-economic arguments, each found to some degree in a wide range of developing
countries, complete the ―population growth is desirable‖ viewpoints. First, many countries claim
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a need for population growth to protect currently under-populated border regions against the
expansionist intentions of neighboring nations. Second, there are many ethnic, racial, and
religious groups within less developed countries whose attitudes favoring large family size have
to be protected for both moral and political reasons. Finally, military and political powers are
often seen as dependent on a large and youthful population.
Many of these arguments have certain realism about them-if not in fact, then at least in the
perceptions of vocal and influential individuals in both the developed and the developing worlds.
Clearly, some of the arguments have greater validity for some Third World countries than others.
The important point is that they represent a considerable range of opinions and viewpoints and
therefore need to be seriously weighed against the counterarguments of theorists who believe
that rapid population growth in indeed a real and important problem for underdeveloped
countries. Dear students, let us now look at some of these counterarguments.
4.3.2 Population Growth is A Real Problem

Positions supporting the need to curtail population growth because of the negative economic,
social and environmental consequences are typically based on one or the other of the following
arguments.
A. The population “Hawk” Argument
The extreme version of the population-as-a-serious-problem position attempts to attribute almost

all of the world‘s economic and social evils to excessive population growth. Unrestrained
population increase is seen as the major crisis facing humankind today. It is regarded as the
principal cause of poverty, low levels of living, malnutrition, ill health, environmental
degradation and a wide array of other social problems. Value-laden and provocative terms such
as ―population bomb‖ or ―population explosion‖ are tossed around at will. Indeed, dire
predictions of world food catastrophes and ecological disaster are attributed almost entirely to
the growth in world numbers. Such an extreme position leads some of its advocates to assert that
―world‖ (i.e. LDC) population stabilization or even decline is the most urgent contemporary task
even if it requires severe and coercive measures such as compulsory sterilization to control
family size in some of the most populated Third World countries like India and Bangladesh.
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B. The Population-Poverty Cycle Argument and the Need for Family Planning
Programs
The population-poverty cycle argument is the main stance among people who hold that too rapid
population growth yields negative economic consequences and thus should be a real concern of
Third World countries. Advocates start from the basic proposition that population growth
intensifies and exacerbates the economic, social and psychological problems associated with the
condition of underdevelopment. Population growth retards the prospect for a better life for the
already born. It also severely draws down limited government revenues simply to provide the
most rudimentary economic, health, and social services to the additional people. This in turn
further reduces the prospects for any improvement in the levels of living of the existing
generation.
If low incomes induce poor families to have more children as a source of cheap labor and old age
security then we have vicious cycle of cheap in progress. Poor people have large families partly
to compensate for their poverty, but large families mean greater population growth, higher
dependency burdens, lower savings, less investment, slower economic growth, and ultimately
greater poverty. Population growth is thus seen as both a cause and a consequence of
underdevelopment.
Because widespread absolute poverty and low levels of living are thus seen as a major cause of
large family size, and large families retard economic growth, it follows that a more egalitarian
economic and social development is a necessary condition for bringing about an eventual
slowing or cessation of population growth at low levels of fertility and mortality. But according
to this argument, it is not a sufficient condition-that is development provides people with the
intensives and motivations to limit their family size, but family planning programs are needed to
provide them with the technological means to avoid unwanted pregnancies. Even though
countries like France, Japan, the United States, Great Britain, and more recently, Taiwan and
South Korea were able to reduce their population growth rates without widespread family
planning clinics, it is argued that the provision of these services will enable other countries
desiring to control excessive population growth to do so more rapidly than if these family
planning services were not available.
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4.3.3 The Empirical Argument: Seven Negative Consequences of Population

Growth
According to the latest empirical research, the potential negative consequences of population
growth for economic development can be divided into seven categories: its impact on economic
growth, poverty and inequality, education, health, food, the environment, and international
migration.
Economic Growth: Evidence shows that rapid population growth lowers per capita income
growth in most LDCs, especially those that are already poor, dependent on agriculture, and
experiencing pressures on land and natural resources.
Poverty and Inequality: Even though aggregate statistical correlations between measures of
poverty and population growth at the national level are often inconclusive, at the household level
the evidence is strong and compelling. The negative consequences of population growth fall
most heavily on the poor because they are the ones who are made landless, suffer first from cuts
in government health and education programs, bear the brunt of environmental damage, and are
the main victims of job cuts due to the slower growth of the economy. Poor women once again
bear the greatest burden of government austerity programs, and another vicious cycle is set in
motion. To the extent that families perpetuate poverty, they also exacerbate inequality.
Education: Although the data are sometimes ambiguous on this point, it is generally agreed that
large family size and low incomes restrict the opportunities of parents to educate all their
children. At the national level, rapid population growth causes given educational expenditures to
be spread more thinly, lowering quality for the sake of quantity. This in turn feeds back on
economic growth because the stock of human capital is reduced by rapid population growth.
Health: High fertility harms the health of mothers and children. It increases the health risks of
pregnancy, and closely spaced births have been shown to reduced birth weight and increase child
mortality rates.
Food: Feeding the world‘s population is made more difficult by rapid population growth -over
90% of additional LDC food requirements are caused by population increases. New technologies
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of production must be introduced more rapidly, as the best lands have already been cultivated.
International food relief programs become more widespread.
Environment: Rapid population growth contributes to environmental degradation in the form of

forest encroachment, deforestation, fuel-wood depletion, soil erosion, declining fish and animal
stocks, inadequate and unsafe water, air pollution, and urban congestion.
International Migration: Many observers consider the rapid increase in international migration,
both legal and illegal, to be one of the major consequences of developing countries‘ population
growth. Though many factors cause migration, an excess of job seekers (caused by rapid
population growth) over job opportunities in the LDC economy is surely one of them
4.4 Goals, Objectives, and Policy Approaches
4.4.1 Goals and Objectives: Toward a Consensus

In spite of what may appear to be seriously conflicting arguments about the consequences of
population growth, during the 1970s and 1980s there emerged a common ground that many
people on both sides of the debate could agree on. This position is best characterized by Robert
Cassen in Population Policy: A New Consensus: After decades of controversy over the issue of
population policy, there is a new international consensus among and between industrial and
developing countries that individuals, countries, and the world at large would be better off if
population were to grow more slowly. The consequences of rapid population growth should be
neither exaggerated nor minimized. Some past expressions of alarm have been
counterproductive, alienating the very audiences they were intended to persuade: at the same
time, claims that population growth was not all that important have had the effects of
diminishing a proper concern for the subject.
The following four propositions constitute the essential components of this intermediate or
consensus opinion:
 Population growth is not the primary cause of low levels of living, gross inequalities,
or the limited freedom of choices that characterizes much of the Third World. The
fundamental causes of these problems must be sought, rather, in the ―dualistic‖ nature
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of the domestic and international economic and social order, as well as in the failures
of many development plans to create jobs and incomes for poor families, especially
women.
 The problem of population is not simply one of numbers but involves the quality of
life and material well-being. Thus, LDC population size must be viewed in
conjunction with developed country affluence in relation to the quantity, distribution,
and utilization of world resources, not just in relation to indigenous resources of the
LDCs.
 But rapid population growth does serve to intensify problems of underdevelopment

and make prospects for development that much more remote. The momentum of
population growth (refers to the tendency of the population to continue even after
birthrates have declined substantially) means that, barring catastrophe, the population
of developing countries will increase dramatically over the coming decades, no matter
what fertility control measures are adopted now. It follows that high population
growth rates, though not the principal cause of underdevelopment are nevertheless
important contributing factors in specific countries and regions of the world.
 Many of the real problems of population arise not from its overall size but from its
concentration, especially in urban areas as a result of accelerated rural-urban
migration. A more rational and efficient spatial distribution of national populations
thus becomes an alternatives in some countries to the slowdown of overall population
growth.
In view of these four propositions, we may conclude that the following three policy goals and
objectives might be included in any realistic approach to the issues of population growth in
developing countries.
 In countries or regions where population size, distribution and growth are viewed as
an existing or potential problem, the primary objective of any strategy to limit further
growth must deal not only with the population variable per se but also with the
underlying social and economic conditions of underdevelopment. Problems such as
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absolute poverty, gross inequality, wide spread unemployment (especially among

females), limited female access to education, malnutrition, and poor health facilities
must be given high priority. Their amelioration is both a necessary concomitant of
development and a fundamental motivational basis for the expanded freedom of the
individual to choose an optimal- and, in many cases, smaller-family size.
 To bring about smaller families through development-induced motivations, family-

planning programs providing both the education and the technological means to
regulate fertility for people who wish to regulate it must be established.
 Developed countries must assist developing countries to achieve their lowered

fertility and mortality objectives not only by providing contraceptives and funding
family-planning clinics but, more important, (a) by curtailing their own excessive
depletion of nonrenewable world resources through programs designed to cut back on
the unnecessary consumption of products that intensively use such resources, (b) by
making genuine commitments to eradicating poverty, illiteracy, disease, and
malnutrition in Third World countries as well as their own; and (c) by recognizing in
both their rhetoric and their international economic and social dealings that
development is the real issue, not simply population control.
4.4.2 Some Policy Approaches

In view of these broad goals and objectives, what kind of economic and social policies might
developing and developed country governments and international assistance agencies consider to
bring about long-term reductions in the overall rate of world population growth? Three areas of
policy can have important direct and indirect influences on the well-being of present and future
world populations.
 General and specific policies that developing country governments can initiate to
influence and perhaps even control their population growth and distribution.
 General and specific policies that developed country governments can initiate in their
own countries to lessen their disproportionate consumption of limited world resources
and promote a more equitable distribution of the benefits of global economic progress
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 General and specific policies that developed country governments and international
assistance agencies can initiate to help developing countries achieve their population
objectives.
4.5 What Can the Developing Countries Do?
It is not numbers per se or parental irrationality that is at the root of the LDC ―population
problem.‖ Rather, it is the pervasiveness of absolute poverty and low levels of living that
provides the economic rationale for large families and burgeoning populations.
Developing country governments can attempt to control fertility in six ways:

1.They can, through the media and the educational process, both formal (school system) and
informal (adult education), try to persuade people to have small families.
2.They can establish family-planning programs to provide health and contraceptive services
to encourage the desired behavior
3.They can deliberately manipulate economic incentives and disincentives for having
children-for example through the elimination or reduction of maternity leaves and benefits,
the reduction or elimination of financial incentives, and /or the imposition of financial
penalties for having children beyond a certain number, the establishment of old –age social
security provisions and minimum age child labor laws, the raising of school fees and the
elimination of heavy public subsidies for secondary and higher education and the
subsidization of smaller families through direct money payments.
4.Countries can attempt to redirect their populations away from the rapidly growing urban
areas by eliminating the current imbalance in economic and social opportunities in urban
versus rural areas.
5.Governments can attempt to coerce people into having smaller families through the power
of state legislation and penalties.
6.Finally, no policy measures will be successful in controlling fertility unless efforts are
made to raise the social and economic status of women and hence, create conditions
favorable to delayed marriage and lower marital fertility. A crucial ingredient in any
program designed to lower fertility rates is the creation of employment for women outside
the home.
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COURSE 15: INTERNATIONAL POLITICAL ECONOMY (IPE)
Unit One
What Is International Political Economy (Ipe)?
A simple if not very enlightening answer is that IPE is concerned with the way in which political and
economic factors interact at the global level. IPE is about the complex interrelationship of economics and
politics at the level of international affairs. More specifically, political economists generally undertake
two related kinds of investigations:

choices by actors or social groups.

firms‗political lobbying activities, or governments‗ internal or external policies.
In the most general sense, the economy can be defined as the system of producing, distributing, and using
wealth; politics is the set of institutions and rules by which social and economic interactions are
governed.
The core question of IPE is: what drives and explains events in the world economy?
In light of the above, one would be forgiven for assuming that the academic subjects of economics and
political science were closely related, even indistinguishable. IPE is the study of how economic interests
and political process interact to shape government policies.
Politics, Economics, and Political Economy
As we shall see, asking how politics and economics interact makes good sense. Economic outcomes
almost always have political implications because of their effects on the distribution of wealth
between various actors and social groups. For the same reasons, economic policies are almost
invariably politicized because different policy choices generally have varying effects on the
distribution of wealth. Political power can therefore be a means by which individuals or groups can
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alter the production and distribution of wealth, and wealth can itself be a means of achieving political
power or influence. Although the pursuit of wealth is certainly not the only motivating factor in
human behavior, it is probably one of the most important and is often the means by which other goals
can be achieved. In short, economic and political factors interact to determine who gets what in
society.
 is
politics. Charles Lindblom
 John Kenneth Galbraith

 ng as a purely economic issue. Milton Friedman
Politics and Economics
As a prelude to the study of political economy, a firm grasp of the words politics and economics is
essential. Unfortunately, these widely used terms lack clear definition. As depicted below, politics and
economics can be distinguished with reference to three characteristics: the primary goal being pursued,
the institutional arena within which the goal is pursued, and the primary actor who chooses the goal.
Economics Politics
Primary Goal Prosperity Justice
Institutional Arena Market Government
Primary Actor Individual Community
Using these distinctions, economics might be defined as the individual pursuit of prosperity through the
market, while politics is the communal pursuit of justice through government. Closer scrutiny of each of
the three distinguishing characteristics, however, will reveal the unsatisfactory nature of these definitions.
Primary Goals
Economics is associated with efforts to achieve the highest possible material standard of living from
available resources. The primary economic goal of prosperity has three dimensions: efficiency, growth,
and stability. Politics, on the other hand, is linked with efforts to establish and protect rights so citizens
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can receive and hold that to which they are entitled. The primary political goal of justice, too, includes
three dimensions: individual freedom, equity in the distribution of benefits and burdens, and social order.
However, distinguishing between economics and politics solely by referring to their respective goals is
ultimately unsatisfactory because prosperity and justice are inextricably linked. A prosperous society is
more likely to be perceived as a just society because the range of individual choice is broadened and order
tends to prevail. Conversely, a just society fosters prosperity by providing open opportunities, fair
rewards, and individual security to motivate production and accumulation of wealth. Because prosperity
and justice are often mutually reinforcing, distinguishing between economic and political processes by
referring to their different goals is inconclusive. Both economics and politics are concerned with
promoting human well-being by maintaining prosperity and justice.
Institutional Arenas
Politics often refers to activities associated with government, while economics deals with activities
occurring in the market. We use this distinction when we label campaigns, elections, and lawmaking as
"political activity," while referring to exchanges of commodities and money as "economic activity." This
method of distinguishing between politics and economics is certainly common, but it also leads to
ambiguity. Like economic transactions, political activity often consists of mutually beneficial exchanges
among self-interested persons or groups. For example, citizens consent to obey laws in exchange for
governmental protection of their rights. Politicians provide particular programs or laws in exchange for
votes or money. Indeed, with the possible exception of establishing a constitution, government activity
can be viewed as a series of exchanges in a political market. Government also functions as an
economizing agent when it seeks to achieve public goals at minimum cost and directs resources toward
their optimal use.
Conversely, the market has various political dimensions. The prevalence of the corporate form of
enterprise demonstrates that economic activity is often pursued by large groups of people collectively
focused on a common goal. Within a corporation, workers are subject to the sometimes arbitrary power of
their employer. Just as governments punish those who violate the law, employers rely on sanctions such
as dismissal or demotion to maintain control over workers. Corporate executives establish goals and rules
with little input from workers, and corporate power is often exercised to influence government policy. In
addition, many market activities have public consequences and, therefore, become political issues of
concern to the community as a whole. Finally, when income and wealth are highly concentrated, the
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power of the rich to command others resembles the prerogatives of a political dictator. Based on these
observations, sole reliance on distinct institutional arenas does not provide an adequate basis for
distinguishing between economics and politics.
Primary Actors
From this perspective, economic activity is pursued by persons acting as autonomous individuals, while
political activity represents the efforts of an entire community to collectively pursue goals. This
distinction is observable in the origins of the words "economics" and "politics." Economics derives from
the Greek words oikos, meaning household, and nomos, meaning principle or law. As the principle of
household management, economics deals with efforts to attain private goals with available resources.
Economizing behavior can be directed toward any goal and practiced in any institutional arena. Reflecting
this approach, economics is sometimes defined as the science of rational choice or the use of scarce
means to achieve specified ends.
Politics, on the other hand, derives from the Greek word polis, meaning community or society. According
to Aristotle, the public life of the polis is the arena within which true freedom and human development
occur. Although economic activities are essential to human survival, they fail to engage the uniquely
human capacities for cooperation and collective decision-making based on reasoned argument, dialog,
persuasion, and compromise.
Distinguishing between economics and politics by reference to the primary actor is problematic due to the
porous boundary separating the private and public spheres. In democratic societies, the collective choices
of the community should largely reflect aggregated individual preferences. Much of the public choosing
of goals through government consists of registering citizen preferences through voting or poll-taking.
Moreover, public choice often reflects the influence of private individuals and groups exerted through
lobbying, campaign contributions, and control over the selection of candidates for public office.
Conversely, the quality of public life affects the goals that individuals choose or are able to pursue. The
material and social environments within which people live shape their language, self-image, desires, and
goals. Given this interaction between public and private spheres, the distinction between individual and
community as primary actors is not fully sustainable.
If politics and economics cannot be clearly distinguished, perhaps these terms are simply two names for
the same process. Both are concerned with organizing and coordinating human activity, marshalling
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resources, managing conflict, allocating burdens and benefits, and providing for the satisfaction of human
wants and needs. However, to completely collapse politics into economics or vice-versa would gloss over
important differences between political and economic goals, institutional arenas, and actors. While
prosperity/justice, market/government, and individual/community may be interrelated, they are not
identical. Therefore, despite the considerable overlap between politics and economics, they can initially
be analyzed as distinct processes.
THE MARKET AS AN ECONOMIC INSTITUTION
The market is a system of exchanges in which individual choices to supply or demand resources or
products interact to determine prices. To assess the market's potential for achieving the economic goal of
prosperity, one must examine each of the three dimensions of prosperity: efficiency, growth, and stability.
For each dimension, arguments both for and against the market are presented.
Efficiency
For the market. A perfectly competitive market will, with some exceptions, direct resources toward their
most highly valued use, resulting in an efficient economy. The market coordinates vast numbers of
transactions with minimal political supervision as prices provide information and incentives to guide
individuals and businesses in making rational choices about employing resources and purchasing
products.
The market achieves efficiency by allowing individuals to make mutually beneficial transactions.
Individuals will exchange with one another until they have reached the maximum level of utility
permitted by the resources with which they enter the market. Competition also promotes market
efficiency. Firms and individuals are under constant pressure to adopt the most efficient technology,
enabling them to produce at the lowest possible cost.
Against the market. Competition is imperfect due to barriers to entry, immobility of resources, lack of
information, product differentiation, and concentrations of power caused by both technical conditions of
production and the efforts of individuals to protect themselves from competition. These imperfections
cause inefficiency.
The competitive individualism underlying market behavior may also be detrimental to efficiency. Intense
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competition may weaken social bonds, causing alienation, apathy, or hostility. These psychological
conditions often manifest themselves in lower productivity, crime, and civil unrest, all of which interfere
with efficiency.
Growth
For the market: The market is a powerful mechanism for increasing both the availability and productivity
of economic resources. By placing both negative and positive consequences of decisions directly on the
individual, the market provides strong incentives for prudent and industrious behavior. When individuals
know they will personally reap the rewards or suffer the consequences of their actions, they are motivated
to consider their choices more carefully. As a result of the market's incentives, additional resources are
made available, the quality of resources is upgraded, and innovation and risk-taking are encouraged. The
combination of technological development and expansion of resources provides an impetus for economic
growth.
The market also fosters psychological changes conducive to growth. By minimizing the constraints of
moral and cultural norms, the market encourages individuals to create their own identities by transcending
the bounds of traditional roles and expectations. Self-reliant individuals may experiment with diverse
lifestyles and forms of expression. Formerly dormant talents and desires are awakened. This process of
self-discovery and self-renewal becomes a significant source of the dynamism of market societies. The
productivity and innovation flowing from energized individuals contributes to rising standards of living
that, in turn, broaden the range of individual opportunities and renew the motivation essential to economic
expansion.
Stability
For the market. The market is extremely flexible in responding to changing patterns of consumer
preferences, technology, and resource availability. Through the price mechanism, these changes
quickly elicit appropriate reactions as businesses and consumers adjust their production and
consumption decisions, respectively. The market contributes to stability by adjusting quickly before
serious imbalances arise. Competitive pressures reward prompt and effective responses to a changing
business environment. Financial markets also contribute to stability. When the economy slows, interest
rates fall until borrowing and investing are again attractive. Conversely, when the economy begins to
overheat, rising interest rates choke off borrowing and spending until stability is restored.
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THE MARKET AS A POLITICAL INSTITUTION
Although the market is usually viewed as an economic institution, it also performs important functions
in achieving the political goal of justice. The market's role as a political institution can be understood
by assessing its capabilities in promoting three dimensions of justice: freedom, equity, and order.
Freedom
For the market. The market provides a wide range of freedoms. Individuals have the right to make
choices concerning employment, place of residence, consumption patterns, and social relationships.
Competing alternatives constrain the power of any single person or firm to oppress and manipulate
others. The sense of freedom offered by the market may partly explain the popularity of shopping.
Consumers tend to enjoy the experience of being able to select from an array of alternatives--the power
to choose with whom they shall transact. The market also provides citizens with opportunities to
engage their resources, including entrepreneurial talent, in the most advantageous way. Finally, the
market potentially protects individuals from abuses of governmental authority by establishing

decentralized bases of power from which citizens can express opinions and organize opposition.
Against the market: While the market offers a considerable range of choice, it also limits choice. The
market provides only commodities that can be sold at a profit and therefore fails to respond to demands
for goods such as national defense, a clean environment, or public transportation. Since only a subset of
human interests is expressible in the market, the freedom of individuals to pursue their goals is
correspondingly narrowed.
Not only does the market limit the range of interests capable of fulfillment, it also conditions individuals
to tailor their interests to suit the capabilities of the market. A social environment in which profitable
commodities are the major source of satisfaction causes humans to develop capacities oriented toward
consumption of commodities and diminishes their freedom to establish self-directed goals.
Although individuals in a pure market are largely free of legal restrictions on exchange, the freedom of
persons with few marketable assets will be limited by their financial inability to pursue personal goals.
Moreover, the prospect of hunger and deprivation effectively coerce individuals to seek employment.
Once on the job, workers surrender much of their autonomy and self-direction to the authority of
employers.
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Even as consumers, citizens may not experience genuine freedom in the market. In real-world markets,
consumers have only limited information and producers tend to be well-organized. Instead of being
sovereigns of the market, consumers may feel like the prey, surrounded by manipulative advertising,
inflated prices, shoddy merchandise, and deceitful sellers.
Historically, the link between markets and freedom has been based on the assumption that the interests of
different individuals are ultimately harmonious. If no transactions are coerced, then all transactions must
benefit both buyer and seller and hence increase the overall well-being of society. However, the record of
real-world markets amply illustrates that the freedom of one individual may restrict the freedom of
another. Markets allow practices such as monopolization of industries, pollution of the environment, and
discrimination, all of which narrow the choices available to citizens.
Equity
For the market: With the forces of supply and demand establishing resource prices, the market
distributes rewards according to each person's ability to provide valuable resources. The market permits
individuals to decide how many of their resources to make available and how much time and expense to
engage in upgrading the quality of their resources. By placing much of the responsibility for personal
income in the hands of individuals, the market distributes the benefits and burdens of society's productive
activities in a manner seemingly independent of political authority.
The market's potential for achieving equity is also enhanced by the presence of opportunity. In a
perfectly competitive market, individual characteristics such as race, gender, religion, or ethnicity
should be irrelevant in determining a person's success. For less successful individuals, resentment is
dampened by awareness of opportunities to offer resources and by the perception that rewards accrue
to resources in accordance with productivity.
Against the market. Concentrations of wealth and power typically appear in a market economy either
because technological conditions favor large producers over smaller businesses or because individuals
intentionally create large organizations to suppress competition and gain some control over market
forces. These concentrations change the market's prices and allocation of resources. As a result,
personal income reflects not only the productivity of resources provided to the market, but also an
individual's status in the power structure. Those persons belonging to powerful groups are likely to
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receive income in excess of their productivity, while members of disadvantaged groups are likely to
receive lower incomes than they would in a competitive market.
Even if the market is perfectly competitive, the distribution of income will reflect the pattern of
ownership of productive resources. Wealthy owners of land or capital may be richly rewarded without
any current personal contribution to production. Since various unethical and illegal means have been
used in the past to accumulate property, the current distribution of income is unlikely to be equitable.
Equity in a market society requires equal opportunity, but when competition generates substantial
inequality of property holdings, the opportunities of some people are restricted. Individuals enter
market competition with burdens or advantages bequeathed by their family backgrounds,
neighborhoods, schools, and cultures. When these conditions vary widely in preparing individuals for
productive employment, genuine equality of opportunity cannot exist.
Finally, the market may be inequitable because it responds only to those human needs and desires
backed by money. The market neither recognizes nor allocates resources toward the protection of
human rights entitling individuals to certain benefits regardless of ability to pay. Examples of human
rights might include the right to legal counsel for accused criminals, the right to public access for the
physically challenged, and the right to a basic level of health care.
Order
For the market. The market erodes traditional human relations based on arbitrary privilege and
hierarchy. By virtue of property rights and civil rights, individuals engage only in transactions of their
own choosing. Freedom of choice and a sense of autonomy contribute to personal wellbeing, and a
satisfied citizenry usually implies an orderly society.
The market also fosters order by increasing specialization of labor, so that formerly diverse and
separate groups become mutually dependent. When individuals benefit from market transactions, they
have an interest in treating each other respectfully. Even nations may be less belligerent when their
economic well-being depends on the prosperity of their trading partners.
Finally, the market contributes to order by distributing society's benefits and burdens without visible
political authority. Each person's success or failure appears to result from impersonal market forces, so
there is no obvious target for resentment or envy. When individuals accept responsibility for their own
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fate, they are less likely to disrupt society.
Against the market. The dynamism of the market undermines traditional values and social structures.
By providing an alternative to the market as an arena in which goals can be pursued, government not only
increases the choices available to citizens but allows for the development of a broader range of
preferences and values. For example, citizens' commitment to racial equality or environmental protection
may be strengthened when they observe the authority of government being directed toward those goals.
Government serves as a model and teacher, enabling citizens to develop their capacities more fully.
Against government. Few public policies have unanimous support and, therefore, government necessarily
infringes on the freedom of some citizens. Taxes, regulations, and laws are considered legitimate
restrictions when they are approved by the majority, do not violate individual rights, and are aimed at
promoting the public interest. However, since modern societies often lack a clear consensus on the
meaning of both individual rights and the public interest, particular government actions may be perceived
as violations of freedom. More generally, democratic governments may be coercive to the extent that they
enable the will of the majority to be imposed on the minority.
As individuals pursue their private interests, cohesive communities and shared purposes are
increasingly displaced by the pursuit of satisfaction through consumption and ownership of
commodities. This individualism undermines the self-restraint and virtue essential to social order. The
market functions well only within a social context based on respect for ethical norms and individual
rights. When self-interested behavior degenerates into unbridled selfishness, social bonds begin to
unravel.
Another potential source of disorder in market societies arises from the conflict of interest between
owners of productive property and workers dependent on employment for their livelihood. Owners
generally seek maximum production from workers at minimum cost, while workers want higher wages
and more satisfying working conditions. This conflict may extend beyond the workplace as class
resentment and hostility manifest themselves in crime and racial and ethnic unrest.
GOVERNMENT AS A POLITICAL INSTITUTION
As a political institution, government seems well-suited to pursue justice by promoting freedom,
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equity, and order. However, government also has significant potential to violate these ideals.
Freedom
For government. Government enables citizens to reach goals they would be unable to attain through
private action, and therefore contributes to freedom by broadening the range of feasible choices. For
example, education, national defense, and security from crime may be better obtained through
government financing. Freedom is more than the absence of external constraints; it also requires a
basic level of material well-being and a social environment conducive to developing and practicing a
broad range of human capacities. Government may contribute to these conditions of freedom and also
restrain powerful individuals and groups from restricting the freedom of others.
With its monopoly on the legitimate use of force through command over the police and military,
government has the potential to severely restrict freedom. Some governments have either revised or
abandoned the rule of law to engage in arbitrary arrest, seizure of property, and surveillance. Freedom can
also be curtailed without resorting to visible oppression. If factions of society hold undue influence over
government, it ceases to represent the public interest and becomes a tool with which powerful groups
oppress their fellow citizens.
Equity
For government: Equity requires that people be treated in accordance with their rights. Whereas the
market recognizes only property rights in determining the distribution of income, a broader conception of
equity includes the recognition of human rights. Property rights entitle owners to market-determined
earnings of their resources, while government assigns human rights to secure those individual interests
deemed worthy of support, even if they are not backed by individual purchasing power. While equity
based on property rights relies solely on the criterion of productivity, human rights may recognize other
criteria of equity such as need, dignity, or simply a person's status as a citizen. If human rights entitle
individuals to economic resources, only government can protect these rights and secure equity.
In the case of a clearly specified human right such as the right to legal counsel for accused criminals,
government's responsibilities are discharged by providing public defenders. However, human rights are
often not codified, but rather implied by legislation aimed at alleviating perceived inequities. For
example, welfare programs and regulated prices imply that citizens have a right to a decent standard of
living, but government has never explicitly enacted such a right. As a result, government's responsibilities
in pursuing an equitable distribution of income are ill-defined and subject to ongoing political
contestation.
Against government: A competitive market distributes income in accordance with the productivity of
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resources. When government overrides market distributions, it confronts the problem of formulating an
alternative criterion of equity. A democratic government will respond to input from citizens, yet citizens
with different conceptions of equity will send conflicting messages to government. Moreover, some
citizens may promote their private goals by wrapping their appeals to government in the cloak of equity.
For example, tobacco farmers may base their requests for government subsidies on the need for economic
stimulus to regions lacking a strong industrial base.
These demands from citizens may degenerate into competition among interest groups seeking to control
government for their own benefit. More powerful groups are likely to win this battle, enabling them to use
government to oppress less advantaged groups. As a result, government itself may be perceived as a
major source of inequity by those who lose income, status, or power as a result of taxes and regulations.
In summary, when government supersedes the market's linkage of rewards with productivity, the absence
of consensus on alternative criteria of fairness may result in widespread perceptions of inequity.
Order
For government: Government promotes orderly human interaction by defining and enforcing rights and
obligations, thereby enabling individuals to form stable expectations of human behavior. Without public
knowledge of the law, resolution of conflict would absorb substantial economic resources. Government
also fosters order by maintaining society's culture, traditions, and boundaries. As a visible symbol and
expression of society's collective identity, a respected government becomes an object of psychological
allegiance, facilitating the formation of both individual identity and a sense of shared purpose and trust
among citizens.
Government further contributes to order by promoting equality of opportunity. When disparities of

income, wealth, and power impede social mobility for less advantaged persons, order is jeopardized by
anger, frustration, and alienation. Finally, government secures order by altering incentives to make
selfinterest more consistent with the public interest. For example, the threat of punishment may
discourage
disorderly behavior. By controlling crime, government may reduce defensive aggression such as
purchasing guns for self-protection.
Against government: Because government can supersede the market's distribution of income, citizens
may attempt to use governmental authority to benefit themselves. Moreover, this process often
becomes self-reinforcing. As some individuals or groups gain benefits from government, other citizens
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conclude that money flows to power, and power requires organization. Interest groups proliferate and
demands on government intensify. This politicization of the economy may contribute to disorder in
two ways. First, productive resources are diverted to the political struggle for control of government,
resulting in slower growth and reduced competitiveness. Second, when government becomes a major
determinant of individual success in a society lacking consensus about social justice, resentment
toward government erodes support for public authority. Citizens perceive government as simply a tool
with which some groups maintain privileges at the expense of others. The combination of a sluggish
economy and political alienation results in social disorder.
GOVERNMENT AS AN ECONOMIC INSTITUTION
A primary human goal is the quest for security. One strategy for achieving security is individual action
aimed at claiming resources for private use; such behavior created the market as a social institution.
However, an alternative approach to security is cooperation and purposeful coordination of human
activities to increase a group's ability to cope with scarcity and uncertainty. Because collective action
can often be more effective than individual action, humans have a strong interest in forming
organizations with rules and structures of authority. These organizations range from labor unions to
corporations to government. Government is unique in that its laws are applicable to all persons within
its jurisdiction and can be enforced through the legitimate use of force. One reason citizens consent to
governmental authority is to secure justice, but government also contributes to the economic goals of
efficiency, growth, and stability.
Efficiency
For government. Government may improve efficiency by responding to imperfections in the market.
For example, lack of information can be remedied by government provision. Concentrations of private
power that impede competition can be addressed with antitrust lawsuits, regulation, or public
ownership. When externalities exist, government can redirect resources by taxing, subsidizing,
regulating, or directly financing goods such as national defense and highways.
Government also promotes efficiency by enhancing the quality and quantity of resources available for
production. During recessions, government may pursue policies to create jobs and increase production.
Public education contributes to a skilled labor force. The stability created by a system of laws
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encourages owners of resources to engage their assets in risky ventures. Even the redistributive
activities of government may promote efficiency by revitalizing human resources and by creating the
perception of fairness. Individuals work together more effectively when they share a sense of
community, and social solidarity is enhanced by an equitable distribution of income.
In addition to improving economic efficiency, government can contribute to a broader social efficiency
by pursuing goals incapable of attainment in the market. Citizens may want safe neighborhoods, clean
air, and social justice, but the market responds only to money-backed demand for profitable
commodities. If preferences for noncommodities are also recognized, then efficiency requires
government action to reallocate resources.
Against government. Government lacks the internal pressure for efficiency created by competitive
market forces. Since public goods are financed through compulsory taxation, government may provide
unsatisfactory services without fear of losing customers. Moreover, bureaucratic processes are
typically slow and inflexible. All these problems are compounded by the self-interest of politicians and
bureaucrats whose pursuit of higher incomes and increased power may subvert efficiency.
Even when politicians have the best of intentions, government may be insensitive to citizens'
preferences communicated through voting. Elections are held only periodically, and voters must select
among candidates offering entire packages of programs. As a result, voters cannot precisely specify
which programs they support. The voting process also fails to allow citizens to express the intensity of
their preferences, and, with a system of majority rule, those citizens who are outvoted will be forced to
pay taxes for programs they do not support. For these reasons, voting may be a less efficient method
for registering preferences than is the process of spending money in the market.
In addition to its own inefficiency, government may cause inefficiency in the market by imposing
regulations, altering incentives, and redirecting resources. Government intervention undermines the
security of property rights and reduces the motivation of individuals to make rational choices. In
theory, the buyer of a commodity in the market pays the full cost and enjoys the full benefit of that
commodity, but the costs and benefits of public goods are spread across the entire population. Since
individuals will neither bear the full cost nor enjoy the full benefit of their political choices, they are
less motivated to make decisions based on careful assessments of costs and benefits.
Growth
For government. Growth is contingent on the ability of society to produce more than it consumes and
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to direct this surplus into productive investment. Government may be able to improve the market's
ability to produce a surplus. When custom and tradition keep resources out of productive use,
government has the power to pry these resources loose and place them into active production.
Furthermore, with its control over taxes, spending, and interest rates, government can steer resources
toward capital accumulation. By financing education and research, government can contribute to the
long-run growth of the economy. Finally, government reduces uncertainty for private investors by
establishing well-defined property rights, a smoothly functioning legal system, and stable market
conditions.
Against government: Government taxation and borrowing absorb money that might otherwise have
flowed into productive private investment. Regulations may divert resources from their most efficient
use and contribute to stagnation. Subsidies and other forms of protective legislation shield firms from
competitive pressures to innovate and modernize. Government redistribution of income may
undermine incentives to engage in productive activity. Not only is the positive incentive of higher
income diminished by taxes and regulations, but the disincentives posed by hunger and deprivation are
partially removed by welfare programs and social security. Government efforts to achieve greater
equality through income redistribution tend to penalize success and reward failure, potentially
diminishing the market's dynamic potential for growth.
Stability
For government: The very presence of government authority increases stability by minimizing conflict
and providing security of property. Appropriate government policies encourage "business confidence"
that is essential to stability. Even policies opposed by some businesses may be beneficial to the
economy. For example, antitrust policies, minimum-wage laws, and progressive taxation can
counterbalance the market's tendency to foster concentrations of wealth and power that jeopardize
stability. Finally, when recession or inflation occurs, government can respond with appropriate fiscal or
monetary policies.
Against government: Government efforts to redirect resources and alter the distribution of income
may, by reducing profitability and undermining business confidence, contribute to instability.
Government also has the power to create a "political business cycle" as politicians seeking reelection
overstimulate the economy in hopes of creating a temporary boom to please voters. Once the election
is over, the stimulus is withdrawn and the economy slips into recession. Even when government
officials act with the best of intentions, the tools of monetary and fiscal policy may increase instability.
By the time bureaucrats and politicians recognize a problem, formulate a response, implement the
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policy, and wait for results, economic conditions may have changed so that the policy is no longer
appropriate. More generally, by seeking to perpetuate prosperity, government may suppress the
mechanisms, such as rising interest rates, that allow the market to stabilize itself. When prosperity is
artificially prolonged, the subsequent recession may be more severe.
POLITICAL ECONOMY: Analysis of the market and government as political and economic institutions
suggests that neither is solely capable of organizing society to secure prosperity and justice. Both
institutions are sufficiently flawed to require a balancing of political and economic processes to sustain a
healthy society. In a positive sense, each institution serves to complement weaknesses of the other.
However, the market and government also generate powerful forces reverberating against each other with
potentially damaging consequences. Since the market and government interact with each other, efforts to
analyze them separately will yield only partial, and therefore distorted, understandings of the social
system. Politics and economics are simply two facets of the process by which society is organized to
achieve both individual and community goals. To study this process, the interdisciplinary approach
provided by political economy is essential. Although political economy was abandoned by most social
scientists in the nineteenth century, events of the twentieth century have accentuated its relevance. As a
result of the Great Depression and two world wars, issues such as growth, distribution, and stability were
transformed from economic into political issues. The boundary between public life and private life was
redrawn, with politics encompassing an ever-larger realm of human activity. More recently, deterioration
of the natural environment and growing concerns about the quality of life have led to renewed conflict
and negotiation over the appropriate boundary between public and private spheres. As the domains of
politics and economics vie for dominance, the interdisciplinary approach of political economy offers great
potential for analyzing and responding to the problems confronting modern societies.
1.2 The Nature of Political Economy
1.2.1 What is political Economy?
Political economy was the original social science. Theorists such as Adam Smith, John Stuart Mill, and
Karl Marx developed broad visions of the social system. Not until the latter half of the nineteenth century
did political economy splinter into economics, political science, sociology, social history, social
psychology, and social philosophy. The motives for this reorientation were mixed. By partitioning the
study of human behavior and society into narrower subdisciplines, social scientists hoped to emulate the
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analytical power and precision of the natural sciences. However, ideological motives also played a role in
the disintegration of political economy.
Thus, the solidification of the boundaries of the newly emerging academic disciplines of economics and
political science in the early twentieth century led to an increasing divorce in terms of research questions,
method and empirical focus. Furthermore, cross-disciplinary dialogue was not improved
The study of political economy is now very much in vogue among historians, economists, and social
scientists. This interest reflects a growing appreciation that the worlds of politics and economics, once
thought to be separate (at least as fields of academic inquiry), do in fact importantly affect one another.
The polity is much more influenced by economic developments than many political scientists have
appreciated, and the economy is much more dependent upon social and political developments than
economists in general have admitted. Recognition of the interrelationships between the two spheres has
led to increased attention from historians and social scientists.
During the 19th and 20th centuries several different definitions of the term ―political economy‖ have
been
set forth. A brief summary of the changes in those definitions provides insight into the nature of the
subject. For Adam Smith in The Wealth of Nations (1776), political economy was a ―branch of the
science of a statesman or legislator‖ and a guide to the prudent management of the national economy, or
as John Stuart Mill, the last major classical economist, commented, political economy was the science
that teaches a nation how to become rich. These thinkers emphasized the wealth of nations, and the term
―political‖ was as significant as the term ―economy.‖ During the nineteenth century the European
scholars
who followed in Adam Smith‗s footsteps created the field of study that is now known as classical political
economy. Together they created a field that provided comprehensive social analysis.
In the late nineteenth century, however, this broad definition of what economists study was narrowed
considerably. Near the end of the nineteenth century, as an integral part of the evolution of the Industrial
Revolution, greater and greater specialization permeated all aspects of life. The university was no
exception. Consequently, classical political economy was divided into the modern academic disciplines of
Economics, Political Science, and Sociology.
Economic investigation began to focus on understanding more fully the operation of specific markets and
their interaction; the development of new mathematical techniques permitted the formalization of, for
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example, laws of supply and demand. At the same time, other scholars were looking increasingly at the
political realm in isolation from the economy. The rise of modern representative political institutions;
mass political parties; more politically informed populations, and modern bureaucracies all seemed to
justify the study of politics as an activity that had logic of its own. Thus, the twentieth century saw largely
an increasing separation of the study of economics from that of politics. Thus for most of the twentieth
century these subject matters were studied separately.
For example, Alfred Marshall, the father of modern economics, turned his back on the earlier emphasis on
the nation as a whole and on the political as important. In his highly influential Principles of Economics
(1890), Marshall substituted the present-day term ―economics‖ for ―political economy‖ and greatly
restricted the domain of economic science. Following Marshall‗s precept that economics was an empirical
and value-free science, his disciple Lionel Robbins in The Nature and Significance of Economic Science
(1932) provided the definition to which most present-day economists subscribe: ―Economics is the
science which studies human behavior as a relationship between ends and scarce means which have
alternative uses.‖ In more modern terminology, economics is defined by economists as a universal science
of decision-making under conditions of constraint and scarcity.
At the end of the twentieth century, the term ―political economy‖ has come back into fashion even
among economists. By the 1980s the increasing evidence of comprehensive global interdependences
could no longer be ignored. The issues that were being studied in disciplinary isolation required a more
integrative analysis. Therefore, the field of International Political Economy was recreated.

brought the world together in ways that had never before been possible.

instantaneously 24 hours a day, seven days a week.

become almost impossible to tell what the home-production country of any complex product such
as an automobile actually is.
 -state.
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Nation-states, through international organizations such as the World Trade Organization, try to
retain some kind of control.
Studying a world of such complexity required a new field that could effectively encompass all of these
rapidly changing circumstances.
The resurgence of political economy after 1970 had two, interrelated sources:
The first was dissatisfaction among academics with the gap between abstract models of political and
economic behavior, on the one hand, and the actual behavior of polities and economies, on the other.
Theory had become more insubstantial and seemed less realistic.
Many scholars therefore questioned the intellectual justifications for a strict analytic division between
politics and economics.
Second, as the stability and prosperity of the first twenty-five postwar years started to disintegrate in the
early 1970s, economic issues became politicized while political systems became increasingly preoccupied
with economic affairs.
For both intellectual and practical reasons, then, social scientists began seeking, once more, to understand
how politics and economics interact in modern society. Formally, therefore, International Political
Economy is an interdisciplinary social science field of study that investigates, analyzes, and proposes
changes in the processes of economic flows and political governance that cross over and/or transcend
national boundaries. These flows include the exchange of goods and services (trade), funds (capital),
technology, labor, natural resources, environmental pollution, and so on. The field attempts to provide
explanations, to evaluate consequences, and to propose possible policy initiatives.
Despite such resurgence of IPE, there are important differences from earlier usages; also there is
considerable controversy over the meaning of the term. For many professional economists, especially
those identified with the Chicago School, political economy means a significant broadening of the scope
or subject matter that economists study. These economists have greatly extended the social domain to
which the methods or formal models of traditional economics are applicable. The underlying assumptions
regarding motivation and the analytical tools of mainstream economics, they argue, are pertinent to the
study of all (or at least almost all) aspects of human behavior. For such Chicago School economists as
Gary Becker, Richard Posner, and Anthony Downs, the methodology of economics—that is,
methodological individualism or the rational actor model of human behavior—is applicable to all types of
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human behavior from individuals choosing a sexual partner to voters choosing the American President.
According to this interpretation, behavior can be explained by the efforts of individuals to maximize,
satisfy, or optimize their self-interest.
Many economists and other social scientists enamored with economics attempt to use the individualistic
or rational-choice methodology of economics to explain social institutions, public policy, and other forms
of social activities that have traditionally been regarded as noneconomic in nature. Such ―economic
imperialism,‖ identified most closely with the Chicago School, covers several scholarly areas that include
neoinstitutionalism, public-choice theory, and what economists themselves call ―political economy.‖ The
essence of this approach to social institutions and other sociopolitical matters is to assume that individuals
act alone or together to create social institutions and promote other social/political objectives to advance
their private interests. Two fundamental positions may be discerned within this broad range of scholarly
research. On the one hand, some scholars assume that individuals seek to create social institutions and
advocate public policies that will promote overall economic efficiency. On the other hand, the term
―political economy‖ is used by neoclassical economists to refer to rent-seeking behavior by individuals
and groups. Trade protectionism is an example of this approach. There is, however, a powerful normative
bias among economists that economic institutions or structures are created to serve market efficiency.
The long-term objective of this body of scholarship is to make endogenous to economic science those
variables or explanations of social phenomena that have traditionally been assumed to be exogenous and
therefore the exclusive province of one of the other social sciences such as psychology, sociology, or
political science. By ―endogenous,‖ economists mean that a particular human action can be fully
explained as a self-conscious effort of an individual to maximize his or her economic interests; for
example, according to the ―endogenous growth theory,‖ a firm invests in scientific research in order to
increase its profits. By ―exogenous,‖ economists mean that a particular action can be explained best by a
noneconomic motive; for example, Albert Einstein may be said to have been motivated in his work by
curiosity or by the desire for fame rather than a desire to increase his income.
Economic imperialists assume that political and other forms of social behavior can be reduced to
economic motives and explained by the formal methods of economic science. Government policies, social
institutions including the state itself, and even whole economic systems, these economists claim, can be
explained through application of formal economic models. For example, economist Edmund S. Phelps
broadly defines political economy as the choice of the economic system itself. Underlying this sweeping
definition of political economy is the conviction, expressed by Jack Hirshleifer, that economics is the one
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and only true social science. The universality of economics, he argues, is due to the fact that its analytic
abstractions such as scarcity, cost, and opportunities are themselves universally applicable and can be
used effectively to explain both individual behavior and social outcomes.
The belief that there is only one universal social science, namely economics, is a powerful dogma
embraced by many, if not most, economists.
At least three different schools of economists employ an economic approach to human behavior:
neoclassical institutionalism, the public- choice school, and what is sometimes called the ―new political
economy.‖ Neoclassical institutionalism attempts to explain the origin, evolution, and functioning of all
types of institutions (social, political, economic) as the result of the maximizing behavior of rational
individuals. The public-choice school is also interested in applying the methods of formal economics to
analysis of political behavior and institutions, especially to the political organization of free men. The
new political economy is interested primarily in the political determinants of economic policy.
The public-choice approach is most closely associated with Nobel Laureate James Buchanan and his
coauthor, Gordon Tullock. Using the framework of conventional economics, Buchanan and Tullock in
their
highly influential The Calculus of Consent (1962) promoted the important subfield of public choice. For
most economists in the public-choice school, the subject matter is the same as that of political science;
they believe that they are applying superior methods of economic science to political affairs. What defines
the public-choice school more than anything else, however, is its political coloration. With certain
important exceptions, such as Nobel Laureates Kenneth Arrow and Paul Samuelson, both of whom have
made important contributions to the subject of public choice, this school of political economists,
especially Buchanan and Tullock themselves, is distinguished by its explicitly normative commitment to
unfettered markets and strong opposition to government intervention in the economy. While some
economists emphasize market failures as a reason for government intervention in the economy, the more
conservative branch of public-choice economics considers government failure—that is, economic
distortions caused by the policies of governments—to be more of a threat to economic well-being.
Politicians and government officials are not the disinterested public servants they are assumed to be by
many economists and advocates of government interventionism; they have interests of their own that they
seek to maximize in their public activities. This position asserts that politicians, liberal reformers, and
others distort the efficient functioning of the market as they use the apparatus of government to further
their own private interests.
Neoclassical institutionalism is one of the most interesting developments in contemporary economics.
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According to neoinstitutionalist economists, economic institutions (and other institutions, including the
state) and their characteristics can be explained by the methods of neoclassical economics. Nobel
Laureate Douglass C. North, one of the foremost representatives of this school, maintains that economic
institutions (like all forms of economic activity) are the consequence of intentional actions by rational
individuals to maximize their economic interests. Economic actions may be motivated by the desire to
increase economic efficiency or may be simply rent-seeking. However, there is a predilection among
neoinstitutionalists and other economists to assume that economic institutions have been produced by
rational efforts to increase efficiency. This neoinstitutionalist school is weakened by the fact that it
overlooks the noneconomic factors responsible for the creation of social institutions and the rules
governing societies.
Most mainstream economists frequently use the term ―political economy‖ pejoratively to refer to the
selfserving behavior of individuals and groups in the determination of public policy. According to the
―new political economy,‖ national policy is most frequently the result of private groups‗ efforts to
employ public means to further their own private interests rather than the result of selfless efforts to
advance the commonweal. Economic policy, this positon argues, is the outcome of distributional politics
and competition among powerful groups for private advantage. For example, the economics literature on
trade protection (endogenous trade theory) exemplifies this approach as it argues that tariffs and other
obstructions to free trade can best be understood as rent-seeking behavior by particular interest groups.
A very different concept of political economy is used by those critics (especially Marxists) who believe
that the discipline of economics has become too formal, mathematical, and abstract. The study of
economics as the development of formal models, many charge, has become largely irrelevant to the
understanding and solving of real social and economic problems. A major reason for this isolation of
economics from the real world, they argue, is that economics neglects the historical, political, and social
settings in which economic behavior takes place. As a consequence, some assert that economics, at least
as it is taught and practiced in traditional departments of economics, has little relevance to the larger
society and its needs.
Closely associated with this general criticism is what many critics regard as the pretension of economics
to be a ―science‖ modeled on physics and other natural sciences. Economics, they contend, cannot be
value-free, and economists should not pretend that it is. According to Marxists and others, conventional
economics reflects the values and interests of the dominant groups of a capitalist society. Rather than
being value-free, economics is alleged to be infused with an implicit conservative social and political bias
that emphasizes market and efficiency and neglects such social problems as inequality of income and
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chronic unemployment. In the opinion of Robert Heilbroner and William Milberg, contemporary
economics is nothing but a handmaiden of modern Western capitalism, and its primary purpose is to make
this troubled system work.
By the end of the twentieth century, the term ―political economy‖ had been given three broad and
different meanings. For some scholars, especially economists, political economy referred to the
application to all types of human behavior, including behaviors that would not be classified by others as
economic, of the methodology of formal economics; that is, methodological individualism or the rational
actor model of human behavior. Other scholars used the term to mean employment of a specific economic
theory or theories to explain social behavior; a good example is found in Ronald Rogowski‗s use of the
Stopler-Samuelson theorem to explain political outcomes over time and space. For those political
scientists, who believe that social and political affairs cannot be reduced to a subfield of economics,
political economy refers primarily to questions generated from the interactions of economic and political
affairs. Proponents of this broad approach to the subject are eclectic in their choice of subject matter and
methods (economic, historical, sociological, political, etc.).
1.2.2 The Nature of an Economy
Whereas economists regard an economy as a market composed of impersonal economic forces,

specialists in political economy interpret it as a sociopolitical system populated by powerful actors. Such
conceptual differences distinguish the study of economics from that of international political economy
(IPE).
1. The neoclassical economic interpretation is that the economy is a market or a collection of
markets composed of impersonal economic forces over which individual actors, including states
and corporations, have little or no control. As former New York Times economic commentator
Leonard Silk has described it, for economists the economy is nothing more than a collection of
flexible wages, prices, interest rates, and similar forces that move up and down allocating
resources to their profitable use as buyers and sellers rationally pursue their own interests. Such
an economic universe is a self-regulating and self-contained system composed solely of
changing prices and quantities to which individual economic actors respond. Economic actors
are assumed to be “price-takers” who seek to maximize, or at least satisfy, their private
interests as they respond to changes in relative prices or to changes in economic constraints and
opportunities.
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2. The political economy interpretation defines the economy as a sociopolitical system composed
of powerful economic actors or institutions such as giant firms, powerful labor unions, and large
agribusinesses that are competing with one another to formulate government policies on taxes,
tariffs, and other matters in ways that advance their own interests. And the most important of
these powerful actors are national governments. In this interpretation, there are many social,
political, or economic actors whose behavior has a powerful impact on the nature and functioning
of markets. This conception of the economy as an identifiable social and political structure
composed of powerful actors is held by many citizens and by most social scientists other than
professional economists.
The role of institutions in determining economic behavior and outcomes is of particular interest in the
political economy interpretation. Social, political, and economic institutions are significant in that they
determine, or at least influence, the incentives that shape the interaction of individuals and groups as
political and economic actors. In economics the two principal explanations for the creation of institutions
are neoclassical institutionalism and the theory of public choice. Both of these theories assume that
institutions can be explained as resulting from conscious action by economic actors to further their
economic interests. These two positions differ, however, regarding the purpose of institutions.
Neoclassical institutionalism is based on the belief that institutions are created primarily to solve
economic problems and will result in increased economic efficiency; for example, neoinstitutionalists
believe that business corporations are created to reduce transaction costs. The public-choice position, on
the other hand, believes that government institutions are created by powerful groups, public officials, and
politicians to promote their own self interest and that they decrease efficiency; for example, tariffs are
essentially rent-seeking devices to shift income from consumers to domestic producers. Both positions,
however, explain the creation of institutions as resulting from rational intentions.
Political economists, on the other hand, believe that institutions are created for a variety of rational,
irrational, and even capricious motives. Moreover, in contrast to economists‗ emphasis on efficiency or
rent-seeking, the political economists argue that institutions are built on the idea of path dependence and
that economic and other institutions are the result of accidents, random choices, and chance events that
frequently cannot be explained as the result of rational economic processes. Institutions are sometimes the
consequence of historical accident and self-reinforcing and cumulative processes. As a consequence,
many institutions are neither efficient nor do they necessarily represent the economic interests of the
individuals who brought them into existence. However, once these institutions are created, for whatever
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chance or irrational reason, they have a powerful advantage over new and more efficient institutions that
could otherwise displace them.
Institutions are even more tenacious than neoinstitutionalism and public-choice theory suggest, and it is
frequently difficult to replace an inefficient institution with a more efficient one. Neoclassical
institutionalism, for example, is based on the assumption of constant returns to scale in which economic
actors who desire to replace an older and less efficient institution or business firm with a newer and more
efficient one can do so without any overwhelming difficulty. However, the established institution or
business firm may enjoy economies of scale (and hence lower costs) merely as a consequence of having
established itself in the market ahead of potential rivals. An existing institution may also have gained a
legitimacy and a powerful constituency whose interests it serves. Thus, even though the potential
efficiency of the new institution or business firm may be much greater than the efficiency of the existing
institution or business firm, the ―barriers to entry‖ are too great to accomplish a change. In the economic
universe of political economists there are many inefficient economic institutions and oligopolistic
businesses that result from random events and irrational decisions.
The study of political economy requires integration of these two fundamentally different meanings of
“economy.” Both the neoclassical and the political economy interpretations of economic activities are
necessary and important ingredients in the effort to understand how the economy functions. Impersonal
markets and powerful actors interact to produce those economic and political outcomes of interest to
students of political economy. The study of political economy requires an understanding of how markets
work and how market forces affect economic outcomes as well as an understanding of how powerful
actors, of which the nation-state is by far the most important, attempt to manipulate market forces to
advance their private interests.
The study of political economy and international political economy requires an analytic approach that
takes into account economics, political science, and other social sciences. It must incorporate the many
economic, political, and technological factors that determine, or at least influence, the nature and
dynamics of the international economy. Yet, such an approach will undoubtedly always be limited in its
explanatory, and certainly in its predictive, powers. There is simply too much that we do not know and
perhaps never will know. As international economist Robert Baldwin has commented, an adequate theory
of international political economy would have to be built upon a theory of how governments reach
decisions, and, of course, there is no such theory. Achievement of our goal of comprehending how the
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international political economy functions will probably always be elusive no matter how hard we work to
improve the study of the international economy.
What You Seek Is What You Find

Interpretations of economic affairs are highly dependent upon the analytic perspective of the observer and
upon his or her assumptions as these determine what the observer looks for or emphasizes. Fundamental
differences between economics and political economy are exemplified in their differing definitions of the
economy to be studied, of the basic economic entities or actors, and of the forces responsible for
economic and, more broadly, sociopolitical change. Members of each academic specialization differ in
their perspectives on economic affairs, questions asked, and methods employed. The differences,
illustrated in the coming paragraphs, are important because they profoundly influence the ways in which
economists and political economists study economic affairs at both the domestic and international levels.
Definition of an Economy
In April 1992, the prestigious National Bureau of Economic Research (NBER) sponsored a conference to
analyze whether or not Japan was deliberately creating an exclusive economic bloc in East and Southeast
Asia. According to Martin Feldstein, NBER director, in his charge to conference participants, the
conference was the first attempt by the Bureau to bring together a group of economists and political
scientists (the latter included experts on Japanese and international politics) to address an issue of mutual
concern. The results of the conference were published in Regionalism and Rivalry: Japan and the United
States in Pacific Asia (1993), edited by Jeffrey Frankel (an economist) and Miles Kahler (a political
scientist).16 The contributions to the book revealed that these two groups of specialists, as they attempted
to answer Feldstein‗s questions, asked different questions, used different methods, and reached different
conclusions regarding the nature of the evolving Pacific Asia economy.
The political scientists‗ analysis concentrated on the trade/investment behavior of Japanese firms and on
official Japanese foreign aid to the region (Official Development Assistance). Evidence, they asserted,
revealed that Japanese corporations, with the active support of the state, were attempting to incorporate
the Pacific Asian economies into regional industrial and financial structures or networks organized,
managed, and dominated by large Japanese corporations.
Through their trade, investment, and other activities, these giant multinational firms working together
with Japanese foreign aid agencies were consciously fashioning a regional division of labor composed of
highly integrated production and distribution networks centered on the Japanese home economy. The
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political scientists concluded that the Japanese, as they had done in the 1930s, were again attempting to
create and dominate an East Asian sphere of influence, albeit this time by peaceful economic means. The
political scientists defined the Pacific Asian economy as a hierarchical structure increasingly determined
and dominated by Japanese multinational corporations and the Japanese state.
The economists, on the other hand, concentrated their analysis on trade flows and other measurable
economic quantities that could be formally modeled. Their analysis of the data led to the conclusion that
the Japanese state and corporations were not attempting to create an exclusive economic sphere in Pacific
Asia. On the contrary, they insisted that what was taking place in the region could be explained entirely in
terms of market forces and the responses of individual firms to those forces. For example, the increasing
Japanese investment in the region and growing trade with the region were considered responses to the
substantial appreciation of the yen following the Plaza Agreement of September 1985 and to subsequent
changes in Japanese comparative advantage. Moreover, analysis of gross trade statistics showed that,
although intraregional trade in Pacific Asia was growing, it was growing less rapidly than trade between
Pacific Asia and the rest of the world. Thus, economists found no evidence either for the existence of a
distinctive Pacific Asian economy or for any Japanese effort to create a regional sphere of influence.
Whereas the political scientists‗ analysis defined the Pacific Asian economy as composed of powerful
economic and state actors, the economists defined the regional economy in terms of economic forces and
quantities. The opposed conclusions of the two groups of specialists reflected the differences in their basic
assumptions about the nature of economic reality, the evidence studied, and the methodology employed. I
believe that the differing analytic approaches and conclusions of the economists and the political
scientists are actually complementary rather than contradictory. Considered together, both intellectual
approaches increase awareness of the role of both political and economic factors in shaping economic
reality and thereby deepen our comprehension of developments in the world economy.
Nature of Economic Actors

In the late 1960s, a group of graduate students in public affairs at Princeton University‗s Woodrow
Wilson School of Public and International Affairs asked a professor of economics to offer a course on the
multinational corporation (MNC). During the 1960s the rapid overseas expansion and increasing
importance of these giant firms (at that time mostly American) had captured public attention and become
intensely controversial. Raymond Vernon and other commentators believed that these business firms
would greatly facilitate efficient utilization of the world‗s scarce resources and speed economic
development of the entire globe. However, Stephen Hymer and other radical critics regarded such
powerful corporations as nothing more than instruments of an expanding American capitalist imperialism
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that was exploiting countries throughout the world. The students believed that the MNC was a novel and
important phenomenon that should be the focus of at least one course in the School‗s substantial
economics curriculum.
The students were firmly rebuffed with the professor‗s response that ―the multinational corporation does
not exist.‖ Corporations exist, the economist granted, but there is no such thing as a distinctive
multinational corporation that behaves differently from other corporations.
Every corporation, whatever its nationality or scope of its activities, behaves in the same way that all
others behave. All corporate leaders make their decisions in response to market signals and in order to
maximize their profits. (Or, as the economist told the students, the purpose of the postman is to deliver the
mail regardless of the color of the uniform.) Economists in general believe that, whether the firm is
American, European, or Japanese, it must optimize within given constraints and respond effectively to
market opportunities in highly competitive markets or go out of business. The fact that a firm happens to
be of a particular nationality and competes in a world market through establishment of overseas
subsidiaries does not significantly change matters. In language that a Marxist or a realist would use, the
ownership of the means of production and the national origins of a business firm are totally irrelevant.
This experience illustrates the view of neoclassical economics regarding the nature of economic actors.
The world of the economist is populated solely by individuals (consumers and producers) pursuing their
self-interest; firms, states, or other economic actors are assumed to be merely aggregates of such
individual actors. Every individual (regardless of ethnicity, class, or national identity) is assumed to act
rationally (employing a cost/benefit calculation) in pursuit of his or her self-interest. There are no
fundamental differences among American, Japanese, or Bantu economic actors. Everyone is assumed to
be seeking the same broad range of economic objectives. The only things that differ from one society to
another are the external constraints on decision-making and the opportunities among which the individual
must choose.
Within other intellectual perspectives, the nature of economic actors appears very different. A Marxist,
for example, regards economic classes (defined by the ownership or non-ownership of the basic means of
production) or such representatives of class interests as politicians or interest groups as the fundamental
actors in economic affairs. According to this view, all corporations (national or multinational) are
representatives of the capitalist class that dominates every capitalist economy. For proponents of a
statecentric approach, on the other hand, the primary economic actors are nation-states or other powerful
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political groups, and, therefore, the nationality of the MNC is of great importance because its behavior is
strongly influenced by the policies and culture of its home society. Viewed from this perspective, a
―multinational‖ corporation is, in its essence, a corporation of a particular nationality whose international
activities are, on the whole, intended to promote the primary interests (economic, political, or even
security) of its nation of origin.
Dynamics of the World Economy

In September 1992, an important and disturbing event occurred when, without warning, private investors
suddenly transferred huge sums of money out of the British pound, the Italian lira, and other currencies
into the German mark, thereby forcing an unwanted devaluation of the pound and other currencies. This
devaluation significantly reshaped the economic and political landscape of Western Europe and tore apart
the Exchange Rate Mechanism (ERM) of the European Monetary System (EMS), whose purpose was to
maintain the values of the European Community currencies within specified narrow bands. As a
consequence of this financial crisis, Great Britain withdrew from the ERM and caused the movement
toward European economic and monetary integration to divide into a ―two-speed‖ process of European
unification.
Interpretations of this episode illustrate the differences between an ―economic‖ and a ―political
economic‖ analysis of the dynamics of the world economy. Economists were certainly aware that political
developments like German reunification and the Danish rejection, in June 1992, of the Maastricht Treaty
had important roles in generating the financial crisis of that fall. However, such political developments
were treated by economists as factors external to the formal economic modeling of the crisis. Economists
were interested in the dynamics of the crisis itself and not the political dynamics that led to the crisis.
Therefore, the underlying political and other causes of this crisis were not closely examined by
economists. Instead, analysis of the crisis by economists focused only on its economic aspects. For
example, formulation of a general model of financial crises was a central purpose in one excellent study
by economists.
Political economists, on the other hand, were more interested in the political genesis of the crisis, its
political resolution, and the longer term economic/political consequences. That is to say, they were most
interested in the external or exogenous political factors that lead to a crisis, contribute to its resolution,
and determine its long-term effects. The point of this comparison is that economists and political
economists were interested in different phenomena and asked different questions. The 1992 financial
crisis illuminated the relationship and interaction of the economic and political forces that provide the
dynamics of the international economy.
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Since the mid-1970s, the size of international financial flows has grown to hundreds of billions of dollars
a day. These immense capital flows can easily overwhelm national economies, as they did the Italian and
British economies in 1992 and many other economies in the late 1990s. Increasing integration of global
financial markets has caused national governments to surrender a portion of their economic autonomy to
global market forces. Although a government may pursue inappropriately expansionary economic policies
for a time, powerful market forces will eventually overturn these policies. The huge outflow of capital
from Italy and Great Britain in 1992 and subsequent devaluations of their currencies forced both nations
to withdraw from the Exchange Rate Mechanism (ERM), although Italy eventually returned.
Many observers believe that the September 1992 financial crisis demonstrated the triumph of
transnational economic forces and economic globalization over the nation-state. In this popular and
influential interpretation, the integration of global financial markets and the resulting huge flows of
capital across national boundaries have led, in the words of one enthusiastic writer, to ―the end of
geography.‖ Some commentators allege that national governments are rapidly losing their economic
autonomy and have even become hostage to global market forces and the whims of international
speculators. Some argue that if a national government fails to heed the interests of the controllers of
international capital, the errant government will not be able to obtain the capital required to carry out its
economic and political plans. International capital markets are alleged to have created a web of economic
interdependence that has transformed the nature of international affairs and destroyed the economic and
political independence of nation-states. Hence, many have concluded that markets are firmly in control of
the world economy. Some believe that the 1997 East Asian financial crisis supports this conclusion.
An alternative interpretation of the earlier 1992 crisis emphasizes the role of government decisions and
political developments in convincing international investors that the currency situation in Western Europe
was highly unstable. The July 1990 decision to eliminate intraEuropean barriers to capital flows had
increased the risk of currency speculation that could cause
exchange rate disequilibria. This potentially risky situation was exacerbated when additional restrictions
were placed on exchange rate flexibility within the ERM. These economic developments laid the
groundwork for the crisis. Political developments that raised questions about the movement toward
European monetary unity included the Danish rejection in June 1992 of the Maastricht Treaty. This
startling action was followed in September by the narrow (51 percent) passage in France of a national
referendum on the Treaty. However, the most important developments leading to the financial crisis were
the several decisions of the German Central Bank (Bundesbank), from November 1990 on, to raise
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German interest rates substantially in order to offset the inflationary consequences of German
reunification. Then the American Federal Reserve lowered interest rates in early 1992 to stimulate the
stagnant American economy. Also, in order to stay within the ERM currency bands, the British
government had attempted to maintain an overvalued pound and thereby caused the worst British
recession in the postwar era. These political developments raised serious doubts that the British could
continue to maintain the value of the pound.
The large gap between Germany‗s excessively high and America‗s excessively low interest rates, plus the
economic troubles of Italy and Great Britain, created a disequilibrium in exchange rates. Hedge-fund
managers like George Soros of the Quantum Fund saw an opportunity for a huge windfall and fled from
the overvalued lira and pound to the mark. Others followed suit in what economists have called a
―speculative overreaction.‖ Thus, although it is correct to say, at one level of analysis, that Italy and
Greatm Britain were overwhelmed by market forces, at a deeper level of analysis it is equally correct to
say that the financial crisis was due to policy decisions taken by American, German, and British financial
authorities. Government decisions and the actions of individual economic actors were responsible for that
crisis. Indeed, French government officials, economic nationalists to the core, denounced the financial
crisis as an ―Anglo-Saxon plot‖ to destroy the movement toward European unity.
The 1992 financial crisis illustrates that both impersonal market forces and the deliberate actions of a few
powerful states can determine the dynamics of the world economy. While Italy and Great Britain were
overwhelmed by market forces, deliberate policy decisions by American and German central banks
produced such economic fundamentals as the differentials in interest rates. Interactions of impersonal
markets and state policies constitute the driving forces in the world economy and the subject matter of the
study of international political economy. Whereas market forces are the domain of eco nomic analysis,
the explanation of economic policies is primarily the province of political economy. Because each mode
of analysis is limited by its assumptions, both should be utilized to improve understanding of the
dynamics of the world economy.
1.2.3 Embeddedness of the Economy

The central idea that markets are embedded in larger sociopolitical systems underlies my interpretation of
both political economy and international political economy. The government, powerful domestic interests,
and historical experiences determine the purpose of the economy and establish the parameters within
which the market (price mechanism) functions. Contrary to economists‗ belief that economic activities are
universal in character and essentially the same everywhere, the specific goals of economic activities are in
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actuality socially determined and differ widely over the face of the earth. For example, although
neoclassical economists assert that the primary purpose of economic activities is to satisfy the desires of
individual consumers, this characterization applies to the United States but not to every other economy.
Japan and many Asian societies, for example, place a high priority on the welfare of the community and
on social cohesion. In fact, the idea that markets should be free to promote the private interests of
individuals is a rather recent belief, and the strength of the welfare state in Western Europe indicates that
even in the West this idea is not universally accepted.
In addition to determining the purpose of economic activity, the sociopolitical system and a society‗s
values determine the role that the market or price mechanism in a particular society legitimately plays and
the socially approved ways in which economic objectives may be pursued. Every society has values and
beliefs that circumscribe the ways in which the market is permitted to function; societies establish rules
and set boundaries that govern the range of activities in which the price mechanism is considered
legitimate; what is considered to be ―fair‖ economic behavior in one society may not be considered fair
in another. For example, bribery is a serious offense in the United States, but what Westerners would call
―bribery‖ has long been a normal and accepted business practice in China. Many Americans complain
that competition from low-wage Asian labor is unfair; many Asians retort that the American criticism is
unfair because low wages constitute their only important comparative advantage. Such national
differences have been a major source of misunderstandings and even of political conflict as national
economies have become more closely linked to one another through trade and investment.
The international economy is also embedded in a sociopolitical system, although not as deeply as are
national economies; the international economy is embedded in an international system of regimes, public
and private organizations, and, most important of all, nationstates. As I shall argue in greater detail below,
the dominant power/s in the international system plays/play a major role in defining the purpose of the
international economy and the principal rules governing international economic activities. For example,
during the Cold War, the Western international economic system, under American leadership, was
intended to strengthen security ties against the Soviet Union.
Economists in general believe that an international economy easily and automatically emerges because, in
the words of Adam Smith, it is natural for mankind to ―truck, barter, and trade.‖ However, it is in fact
politically very difficult to create an open world economy. As Mancur Olson has pointed out, the decision
of a government to open its economy to imports and other commercial activities constitutes a politically
risky action because it immediately results in many resentful losers and, at least initially, produces just a
few winners. Necessarily then, Olson argues, the creation of an international economy is the result of
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costly actions taken by powerful states (hegemons) for economic, political, and especially security
reasons. Private economic interests, especially those of powerful business groups, also obviously play an
important role in the efforts of powerful states to create an international economy. However, the political
and security interests of states themselves play the central role in its creation.
The primacy of the national economic and political interests of dominant powers is illustrated in the
nature of successive international economies since the mid-seventeenth century. During the mercantilist
age of the seventeenth and eighteenth centuries, the major powers of Western Europe fought on land and
sea to create empires that would support their political rivalries. Although companies of
merchantadventurers such as the British and Dutch East India Companies benefited from these
commercial conflicts, the primary concern of states was to acquire a favorable balance of trade/payments
to finance their external military and political ambitions. Great Britain‗s victory in the Napoleonic Wars
resulted in a new and differently ordered international economy. Formal imperialism and possession of
colonies were deemphasized and what historians called ―the imperialism of free trade‖ emerged. Or, in
the words of Stanley Jevons, one of England‗s foremost economists in the late nineteenth century,
―Unfettered commerce . . . has made the several quarters of the globe our willing tributaries.‖ The Pax
Britannica and Britain‗s dominant global position were thus built on economic foundations.
Following World War II, the United States launched a concerted effort to create an open world economy.
The origins of this effort can be traced to the Reciprocal Trade Act of 1934 and the Tripartite Monetary
Agreement a few years later. In addition, American postwar planners working mainly with their British
counterparts began to lay the foundations for an open world economy following the war; this cooperative
effort culminated in the Bretton Woods Conference (1944) that created the institutional framework for the
postwar international economy. However, strong assertion of American postwar economic leadership
occurred only after the emergence of a clear Soviet threat. With the outbreak of the Cold War, the United
States undertook a number of important initiatives to strengthen the wartorn economies of its allies, to
forge a powerful anti-Soviet alliance, and subsequently, to fasten these allied economies firmly to the
United States. The most important American action was, of course, the Marshall Plan that transferred
billions of dollars to Western Europe; this extraordinary transfer of wealth would not have taken place if
not for the Cold War. In effect, the United States used its political, economic, and other resources to
create an open world economy embracing its political allies and much of the Third World.
This analysis suggests that the creation and maintenance of an open and unified world economy requires a
powerful leader or ―hegemon‖ that possesses both the political interest and the resources to pay the high
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costs associated with such a task. It is highly unlikely that an open and unified world market economy
could be created and maintained unless there were a dominant power able and willing to use its political,
economic, and other resources to encourage other states to lower trade and other economic barriers, to
prevent free-riding, and to apply sanctions to states that failed to obey the rules or regimes governing the
liberal world economy. If there were no such strong leader, international cooperation among egocentric
states would be exceedingly difficult, and there is a likelihood that the open, unified world economy
would fragment into national protectionism and regional blocs.
The emphasis in this book on the role of political actors using their power to influence market outcomes
has some similarities to the position of the public-choice school that argues that all political behavior,
including that of public officials, can be explained as the pursuit of private interests by self-centered
individuals and groups. However, Robert Gilpin‗s position differs from this perspective in important
respects. The public-choice school implies that politics and markets can, at least in theory, be separated; it
argues that if there were no state intervention in the economy, the price system by itself would determine
all outcomes. Robert Gilpin believes, on the other hand, that the market is inherently political. For
example, the distributive effects of markets are determined primarily by the nature and distribution of
property rights, and property rights themselves and their distribution are inevitably affected by political
developments. Further, whereas the public-choice position believes that public officials are motivated
primarily by economic interests, Robert Gilpin believes that national security and prestige play an equal
and frequently an even greater role in motivating the behavior of national governments.
Another difference between the public-choice position and that of Robert Gilpin discussed here is based
on different concepts of the nature of the state and the national interest. The public-choice position
believes that the state is simply a collection of those individuals who comprise the government at a
particular moment; the national interest is the combined interests of the individual members of the society
or of those members who dominate the government. On the other hand, Robert Gilpin believes that the
state is more than the sum of its component parts, that it has some autonomy from society, and that the
national interest is distinct from the combined interests of its parts. The state and the national interest
cannot be reduced, as the public-choice position asserts, to the individuals who happen to be in power at
any particular moment. Most adherents of the public-choice position believe in free trade, as does Robert
Gilpin. However, the commitment to free trade must be based on a concept of a national interest and the
belief that free trade will benefit that national interest and not just the interests of those in power at the
time.
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A state or national government must fulfill several social, economic, and political functions to retain the
loyalty of its citizens. Provision of security for its citizens both at home and abroad is the primary
function of the state; no other institution can relieve it of this responsibility. Another function is to
promote the social and economic welfare of its citizens and to guarantee minimal standards of individual
justice; although the social welfare function has long existed, as James Mayall has emphasized in
discussing what he calls ―the new economic nationalism,‖ economic welfare has become intimately
joined to national citizenship in the modern world. Without a state of their own, individuals have no
access to welfare programs. The state also provides an identity for its citizens; it appears to be inherent in
human nature that individuals need to be part of some larger social grouping. In many societies there is
growing concern that globalization is leading to loss of a separate identity for individual citizens and
individual states. This situation reinforces my belief that political economy‗s concept of an economy as
markets embedded in a sociopolitical system is not only accurate but that it also provides a very useful
tool of analysis.
1.3 The Neoclassical Conception of the Economy

During the past two centuries, professional economists have studied the economy as a market system;
economists from David Ricardo (1772–1823) to the present have formulated theories to explain economic
affairs. These theories have had a significant influence on the trade, monetary, and other policies of
national governments. Because the foundation provided by the discipline of economics is essential to
comprehension of the economy as a ―market,‖ this part will discuss the science of economics, its
strengths, and its limitations.
The Discipline of Neoclassical Economics

In the 1955 edition of his influential textbook, Economics, Nobel Laureate Paul Samuelson coined the
term ―neoclassical synthesis‖ to characterize the theoretical consensus of professional economists.
Samuelson was referring to the consensus that economists had achieved through integration of
microeconomics (associated with Alfred Marshall and other leading economists of the late nineteenth
century) with the new macroeconomics set forth by John Maynard Keynes in his General Theory of
Employment, Interest, and Money (1936).1 Even though this consensus later broke down in the 1970s
when the economics profession fragmented into a number of competing schools of macroeconomic
thought, the term neoclassical economics is still used to refer to mainstream, orthodox, or conventional
economics. It is applied to the economics of the Keynesian, monetarist, or other divergent schools of
contemporary economic thought because they all are based on similar assumptions regarding the nature of
the market. Perhaps one could say simply that neoclassical economics can be defined as the body of
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methods and theories accepted and utilized by most members of the economics profession. In this
material, we use the term ―neoclassical economics‖ (or simply ―economics‖) in this general sense.
Neoclassical economics constitutes a systematic examination of economic affairs as they are defined by
professional economists. Economics is a discipline or profession into which its practitioners have been
thoroughly socialized. It is the most systematic and rigorous of the social sciences and the necessary
starting point for understanding not only the economy but also many other aspects of society. However,
economics is only that—a starting point; it is the beginning and not the end of analysis. The systematic
approach taken by neoclassical economics provides many advantages but also embodies certain
limitations. Social reality, despite the efforts of economic imperialists and many rational-choice analysts
to persuade us to the contrary, cannot be reduced solely to the prices and quantities of economic science.
Modern economics, like physics and the other hard sciences and unlike the other social sciences (with the
possible exception of demography and certain fields in psychology), had a founder or lawgiver who, in
effect, defined the purposes, parameters, and methodology of the discipline. The role of the lawgiver in an
academic discipline has been well characterized by Charles Gillispie in his portrayal of Galileo Galilei
who founded physics, the first science worthy of the name. As Gillispie described his genius, Galileo
earned recognition as the first true physicist and founder of modern physics because he asked the right
questions, proposed answers (hypotheses or theories), and created an appropriate methodology
(experimental techniques) with which to test possible answers. In such other physical sciences as
chemistry and biology, there are other creative geniuses who laid the foundations of their disciplines.
The foundations of a scientific discipline, or any academic discipline for that matter, must contain several
elements. Each discipline requires a commonly accepted definition of the subject and general agreement
on the questions that the members of the discipline must attempt to answer. Another component is a
generally preferred means r methodology; the principal method of economics is methodological
individualism (the rational-actor method), which assumes that rational, self-centered individuals are the
basic economic actors. Possible answers, hypotheses, and eventually theories (perhaps laws) satisfy, at
least for a time, the questions of interest to the discipline. The questions, methods, and answers evolve,
accumulate, and are discarded over time, through open competition among ideas. The winning ideas in
this intellectual struggle become part of the ever-evolving consensus of the profession.
The foundations of modern economics were laid by David Ricardo in the early decades of the nineteenth
century.3 Ricardo and his fellow classical economists shared a number of basic assumptions, including
the idea that everything of value was created by labor (the labor theory of value) and a belief that the three
basic factors of production (land, labor, and capital) could not move across national boundaries. Ricardo
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and other classical economists were particularly interested in learning (1) what laws govern the
distribution of income among the factors of production and (2) the determinants of international trading
patterns; that is, the composition of the imports and exports of different countries. Seeking answers t
these questions, Ricardo utilized basic mathematical techniques and formal models that continue to be the
accepted methodology of professional economics. Ricardo also formulated the law of diminishing returns
(or rent) to account for the distribution of national income and the principle or theory of comparative
advantage to explain trade patterns. With that principle, he explained why Great Britain exported textiles
and imported port from Portugal. While the questions, methods, and theories of the economics profession
have changed over the past century and a half, Ricardo‗s basic approach to the subject has continued to
guide his economist successors.
Economics as the Science of Rational Choice

Most contemporary economists would join Paul Samuelson in defining economics as the study of choice
under conditions of scarcity. According to this definition, the study of economics originates in the
fundamental fact that, in a world where everything is scarce, choices must be made. Economics is the
science that guides individuals to make an efficient allocation of scarce resources to alternative and
frequently equally desirable goals. In other words, modern economics is basically a science of rational
choice or decision-making under conditions of scarcity or constraints. Economics, according to many if
not most economists, can provide a comprehensive explanation of human behavior based on market
principles.
Every decision, whatever benefits it may bring, involves a cost or what economists call an ―opportunity
cost.‖ In choosing to do one thing, one must necessarily forgo the opportunity of doing something else
that might be of equal or even greater value. As economists frequently quip, ―There is no such thing as a
free lunch‖ (TSTFL). Even a free lunch involves an investment of time and, therefore, surrender of an
opportunity to do something else. In more stark terms, everything incurs a cost as well as a benefit. The
economist‗s constant awareness that every decision involves a necessary trade-off between costs and
benefits casts a conservative mantle over the social and political outlook of the profession and may
explain why Thomas Carlyle characterized economics as ―the dismal science.‖
Although some economic theorists such as Adam Smith, Karl Marx, and Joseph Schumpeter have
attempted to comprehend the economy as a complete, dynamic, and ever-changing system of human
interaction, economics in the early twenty-first century is essentially a toolbox of formal models and
analytic techniques. In Keynes‗s words, ―The Theory of Economics does not furnish a body of settled
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conclusions immediately applicable to policy. It is a method rather than a doctrine, an apparatus of the
mind, a technique of thinking, which helps its possessor to draw correct conclusions.‖
While its methodology provides economics with its analytic rigor, it encourages economic theorists to
oversimplify economic reality and frequently has no social relevance. In the inevitable trade-off between
rigor and relevance, economists will choose the former over the latter almost every time. One of the
highest compliments that one economist can give another is to describe his or her work as ―robust,‖
regardless of its utility in furthering understanding of the actual working of the economic system.
A formal economic model is an intellectual device used to explain a particular event or variable; such a
model is an abstraction based on an economic theory. Although a model may take a literary form, the
economics profession, ever since publication of Samuelson‗s Foundations, has preferred that models be
expressed in formal, mathematical, and abstract terms. Stated simply, a formal model contains a number
of endogenous variables whose values (prices or quantities) are determined logically within the model.
Explanation of an event also requires exogenous or external variables and one or more behavioral
assumptions that connect the exogenous and endogenous variables. The central behavioral assumption is
that individual actors are rational and are always seeking to satisfy their own economic interests. The
exogenous variable or variables are the ―givens,‖ or initial conditions, that determine or influence the
value of the endogenous variables. These explanatory or independent variables are external to the model;
they could include a change in consumer tastes, innovation of a new technology, and/or other factors.
Economics, then, is essentially a collection of formal models applied to analysis of specific problems and
to an explanation of economic phenomena. The fundamental purpose of economic research is to create
new models or to extend existing ones. The professional training of the economist centers on the task of
learning analytic tools and knowing which model is applicable to a particular circumstance. To
paraphrase Paul Krugman, to say that models define the subject of economics means that, if there is no
model available to explain a particular phenomenon, that phenomenon is of little interest to the economics
profession regardless of its importance for the real world. Krugman has suggested that this explains why
little attention has been given to the determinants of economic development, an area for which economists
have not yet developed an adequate model.
The utility of a model is situation-specific, and as situations are seldom identical, it can be difficult to
know which model is in fact applicable and whether the model can actually predict or explain the
outcome of a particular situation. Indeed, economists disagree on the validity of various models and on
which model is applicable to a particular situation. As Charles Kindleberger has commented, the answer
to every important question in economics is ―it depends!‖ Or, in more formal terms, every economic
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model is qualified by the caveat of ceteris paribus (or, providing that all other things are equal!).
Because all economic theories are partial theories and even such basic laws as supply and demand are
contingent on specific circumstances, the utility of models is strictly limited. Economists must deal with a
large number of variables and must employ simplifying assumptions.
Economics as the Universal Social Science
For many economists, economics is better defined by its methodological approach than by its precise
subject matter. As Krugman has noted, the tools define the subject for the economist, and the domain of
economics is determined by the range and applicability of its methods. Gary Becker, an influential
proponent of this view, sets forth in his book, The Economic Approach to Human Behavior (1976), the
basic assumptions underlying economics methodology and, thus, the economic approach to the study of
social, political, and all other forms of behavior. The assumptions he discusses are:
(1) Economics assumes rational end/means calculations, or ―maximizing behavior more extensively and
explicitly‖ than do other social sciences.
(2) Rational or maximizing behavior guides efforts to obtain or maintain ―stable preferences.‖ These
preferences are not for specific items such as oranges versus apples, but for such basic aspects of life as
food, honor, prestige, health, benevolence, and especially wealth. Economics assumes that people
everywhere, regardless of their social condition, differ little on these basics. Economics is therefore
considered to be a universal science of human behavior, and its methods and assumptions are believed
applicable to all times and to all places, whether fifth-century Greece or contemporary industrial Japan.
(3) Markets develop naturally in order to coordinate, with varying degrees of efficiency, the actions of
different participants. The methodology based on these assumptions is known as methodological
individualism or the rationalchoice model of human behavior. Economic analysis assumes that
individuals (individual consumers, producers, and households) are the only social reality. These
individuals are further assumed to be rational optimizers; that is to say, they are individuals who make
conscious choices to maximize (or at least satisfy) their interests at the lowest possible cost to themselves.
According to this doctrine of ―constrained optimization,‖ since every individual exists in a world of
scarcity and constraints, an economic actor wishes to make the most efficient use of the limited resources
available to him or her. This rational-choice model applies only to endeavor and not to outcome. An
individual‗s failure to achieve an end or objective due to ignorance or some other cause does not, at least
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in the rational-choice model of human behavior, invalidate the premise that individuals act on the basis of
a cost/benefit or means/ends calculus.
In the abstract world of the economist, all individual consumers are assumed to be alike; that is,
homogeneous. All individual producers are assumed to be alike also. For example, every corporation,
regardless of its nationality or ownership, is believed to make its decisions on the basis of prices, market
considerations, and other objective factors, and their primary objective is assumed to be increased profits.
Even though different cultures and historical settings provide differing constraints and opportunities,
individuals everywhere are still believed to be essentially the same. While Americans, Japanese, and
Brazilians find themselves in very different circumstances, their basic wants do not differentiate one from
the other. The environment determines the constraints and opportunities that shape the means available to
individuals to reach their goals. The belief that individuals everywhere are rational optimizers provides
the foundation for the neoclassical economist‗s certainty that economics is a universal science based on
the objective laws of the market and is applicable to every economy regardless of its level of development
or its culture.
The behavior of individual consumers and producers in the rational pursuit of their objectives is governed
by the principle of marginal utility, or marginality. On the demand side of the economy, according to
marginal-utility analysis, as consumers consume more and more of a good they experience diminishing
utility; that is, while the first ice cream sundae consumed may be devoured with great pleasure, each
additional sundae provides less pleasure (decreasing utility) and the demand of the individual for more
sundaes decreases. On the supply side of the ledger, in situations when there are no economies of scale, as
producers expand production of a given good they begin to encounter diminishing returns and rising costs
per unit. These diminishing returns and rising costs mean that, at some point, the producer no longer has
an incentive to produce more of the commodity. In effect, a small change in one economic variable results
in a small change in another economic variable. A competitive equilibrium in which the actor has no
further incentive to consume or to produce is eventually attained through such a process of incremental
change. The one possible exception to the principle of marginal utility, at least for most individuals, is the
desire for wealth itself, a desire that appears insatiable.
The model of competitive equilibrium is intellectually and morally attractive. A free-market competitive
equilibrium becomes efficient when demand equals supply in every market and all the resources of an
economy are fully utilized. Such an equilibrium has been reached when no individual or firm can achieve
greater welfare by altering the allocation of resources in any way whatsoever without decreasing at least
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one other person‗s welfare; this is the concept of the Pareto optimum. In other words, the distribution of
income and wealth that emerges in such an equilibrium cannot be altered by economic policies without
hurting at least one other person. In effect, economic policy necessarily must either have no effect or must
hurt some group of citizens. Therefore, most economists believe that the role of government should be
minimal.
An important and far-reaching implication of these fundamental ideas is that economics and its
emphasis on individual choice is applicable to all aspects of human behavior. As a universal science
of choice, economics has no clear and separate domain of its own but can be used to analyze and
understand almost every facet of human behavior. Moreover, the theories of economic science (like those
of physics and chemistry) are considered objective, universal, and applicable across all societies and
historical periods. The fundamental principles of economic science and its methodology are not limited
by boundaries of any kind.
This proposition, that economics is the ―one and universal‖ social science, has been defended by Lionel
Robbins in the following words: Despite claims of the universality of economic laws, economists have
extreme difficulty identifying such laws, and agreement on the validity of any specific law may be
impossible to achieve. For this reason, John Stuart Mill referred to economics as an inexact science and
characterized its laws as tendency laws; that is, as generalizations regarding what will happen if no
disturbing event should intervene. Obviously, differing national policies and social systems can become
intervening variables.
Nature of a Market
The concept of the market as a self-regulating and self-correcting ―smoothly functioning machine‖
governed by objective laws and universal principles is at the heart of economics. Moreover, this concept
leads to the conclusion that the free-market system, under certain circumstances and assumptions such as
complete information and non-oligopolistic competition, leads to an optimal allocation of given resources.
Economists work to define the laws governing markets of all kinds, and their principles and
generalizations are the best available guide to explain how markets work and, to a lesser extent, why they
sometimes do not work. Although all of us have observed and participated in markets where goods,
services, and money are exchanged, ―the market‖ conceived by economists is an abstraction or
intellectual construct. While some markets may have a physical location like a stock market or an auction,
many markets do not have a physical existence that one can experience directly. Indeed, the market
economy as conceived by economic theory consists only of interdependent equations that are solved
continuously and simultaneously.
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Economists believe that a market arises spontaneously to satisfy needs. Human beings are by nature
economic animals who, according to Adam Smith, have an inherent propensity to ―truck, barter and
exchange.‖ To facilitate exchange and improve their well-being, people create markets, money, and
economic institutions. However, once a market exists, it is believed to function in accordance with its
own internal logic and without central direction. Coordination among the activities of individuals
participating in a market is spontaneous and is guided by the ―invisible hand‖ of self-interest.
The rational and homogeneous individuals of economic science live in an economic universe composed
solely of prices (p) and quantities (q) that possess no ethnic, national, or other identity. Changes in prices
and quantities constitute the signals to which individuals respond in their efforts to maximize their goals
or, as economists prefer, their utilities. Individual consumers and producers make decisions based on
changes in relative prices, market opportunities, and external constraints. Prices, at least over the long
term, are determined by such objective economic laws as the law of diminishing returns and the law of
supply and demand. The law of demand is the most important of the laws that drive or govern the
economy. This ―law‖ holds that people will buy more of a good if the relative price falls and less if the
relative price rises; people will also tend to buy more of a good as their relative income rises and less as it
falls. Any development that changes the relative price of a good or the relative income of an actor will
create an incentive or disincentive for an individual to acquire (or produce) more or less of the good. This
simple yet powerful law of demand is fundamental to the functioning of the market system.
One of the most important concepts employed by economists to understand market functioning is static
equilibrium (or simply equilibrium). An equilibrium exists when there is no tendency for the balance
between such interrelated variables as prices and quantities to change. In less technical language, an
equilibrium means that no economic actor has an incentive to change his or her behavior and the costs and
benefits of the existing situation are judged to have achieved the best balance that an individual could
reasonably expect. Therefore, the potential gains from changing the situation are not worth the potential
costs, so no change takes place. The concept of equilibrium is central to explanations of both economic
stability and economic change. Neoclassical economics assumes that markets, at least over the long term,
tend toward an equilibrium in which supply matches demand. When a disequilibrium exists, powerful
forces will bring the system back into equilibrium. Economists use the term ―disequilibrium‖ to mean
any change in demand, opportunities, or relative prices that gives an economic actor an incentive to
change his or her behavior in order to increase his or her gains or decrease his or her costs. For example,
an increase in the supply, and hence a decline in the price of a good, will give some actors an incentive to
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increase their consumption of the good (subject, of course, to the principle of diminishing returns). Over
time, the imbalance between the increased supply and the increased demand for the goodwill be
overcome, and the market will be restored to an equilibrium condition in which no actor has an incentive
to change her or his behavior. Thus, a market equilibrium is defined by economists as a system of prices
and quantities in which there is a balance between opposing forces.
The concept of equilibrium is a powerful analytic tool. Yet, this concept can also be quite misleading.
Economists generally use the term as if they really could determine at any particular moment whether or
not an equilibrium actually exists in a particular market. However, as Fritz Machlup emphasized, the
concept of equilibrium is an abstract concept and cannot tell us whether in reality equilibrium actually
exists. Moreover, rather than being a neutral term, the concept may be loaded with policy and political
biases. The equilibrium concept is central to economists‗ study of the market, but there are problems in
using equilibrium as an explanatory or predictive tool.
Markets are highly dynamic and are continually revolutionizing societies. Certain characteristics of a
market economy explain its dynamic nature: (1) changes in relative prices in the exchange of goods and
services, (2) competition as a determinant of individual and institutional behavior, and(3) the effect of
efficiency in determining the survivability of economic actors. The market‗s profound consequences for
economic, social, and political life flow from these characteristics. The pressures of market competition
and the imperative to achieve ever greater efficiency lead to the continuous innovation of new
technologies, organizational forms, and productive techniques, and to discarding of the old in what Joseph
Schumpeter called a ―process of creative destruction.‖ At both the domestic and international levels, a
market system creates a hierarchical division of labor and distribution of wealth among producers, a
division based principally on specialization and the law of comparative advantage. Market forces lead to
the reordering of society (domestic or international) into a dynamic core and a dependent periphery. The
core is characterized principally by its more advanced levels of technology and economic development;
the periphery is, at least initially, dependent on the core as a market for its exports and as a source of
productive techniques. In the short term, as the core of a market economy grows, it incorporates into its
orbit a larger and larger periphery; in the long term, however, due to the growth process and diffusion of
productive technology, new cores tend to form in the periphery and then to become growth centers in
their own right. Examples of these tendencies for the core to expand and to stimulate the rise of new
competitive cores and the profound consequences for economic and political affairs produced by such
developments will appear throughout this book.
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Comparison of Economics and Political Economy
Economics is clearly a more rigorous and theoretically advanced field of study than are political economy
and the other social sciences. However, economics is based on highly restrictive methodological
assumptions and, despite flourishing ―economic imperialism,‖ the domain of formal economic analysis
is quite limited. Moreover, efforts to apply the rational choice techniques of economic analysis to the
messy world of politics and social affairs more generally have not achieved consistent success. Although
economic theories and method s are important and provide an essential foundation for the study of
political economy, they are not in themselves sufficient to explain the nature and dynamics of the ―real‖
world economy. This writer believes that combining the insights and theories of economics with the more
intuitive and less rigorous techniques of history and the other social sciences leads to a more profound
and useful comprehension of economic affairs than does adherence to any one field alone.
The most fundamental difference between neoclassical economics and the study of political economy is in
the nature of the questions asked and of the answers given. Neither is superior to the other, nor is there
any necessary conflict between the answers given by neoclassical economists to the questions that interest
them and the answers given by political economists to their different questions. The two subjects
complement one another, and political economists of almost every persuasion do, in fact, accept most, or
at least much, of the corpus of conventional neoclassical economics. Even though political economists
frequently consider the theories of neoclassical economics to be too limited, too abstract, and in many
cases not directly relevant to the particular questions of interest to them, insofar as they are technically
competent to do so, they draw upon the accepted theories of economics as they study many specific
issues.
Economics and political economy differ significantly in their view of the role of the market in economic
affairs and of the relationship of the market to other aspects of society. Whereas neoclassical economists
believe that the market is autonomous, self-regulating, and governed by its own laws, almost all political
economists assume that markets are embedded in larger sociopolitical structures that determine to a
considerable extent the role and functioning of markets in social and political affairs and that the social,
political, and cultural environment significantly influences the purpose of economic activities and
determines the boundaries within which markets necessarily must function.
Neoclassical economists and scholars of political economy also disagree with one another regarding the
limitations of economics as an analytic tool useful for understanding the dynamics of social, political, and
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even economic affairs. While economic science provides a useful framework for static analysis, it seldom
can explain changes in fundamental economic variables; for example, despite the central role of
technological developments in economic affairs, economists do not have an explanation for technological
change. In fact, the crucial determinants of economic change lie outside the framework of economic
analysis. Reviewing the economics literature on the subject of economic change, Joseph Stiglitz comes to
the astonishing conclusion that economists have not learned much about the dynamics of the economy.
Despite the attempts of economic imperialists and rational-choice theorists to explain all forms of human
behavior through application of the techniques of microeconomics, these techniques have limited utility
for analyzing and explaining human behavior. Most political economists, I believe, would agree with the
distinguished economist Joseph Schumpeter that economic analysis progresses until it inevitably
encounters social, political, and psychological factors that economics cannot explain.50 Although the
research strategy of economic science is to ―endogenize‖ exogenous variables, economic analysis and
explanation are unlikely ever to exceed a certain limit.51 There will always be exogenous variables such
as culture, technology, and institutions that affect economic outcomes but cannot themselves be explained
endogenously by the methods of economics; that is, in terms of rational individuals attempting to
maximize their economic self-interest.
As Schumpeter states in another context, conventional economics can tell us how to manipulate the
existing economic apparatus in order to increase its efficiency, but economics cannot explain how that
economic apparatus came into existence in the first place. Yet, identifying the determinants of an
economic system is one of the most important problems that should be solved by economists and political
economists alike. Indeed, how can economic development be understood without an answer to this
question?
1.4 The study of International Political Economy
The study of international political economy (IPE) is of necessity highly dependent on the theories and
insights of neoclassical economics. However, IPE and neoclassical economics ask different questions as
they apply their own mode of analysis. Whereas economics is primarily concerned with efficiency and the
mutual benefits of economic exchange, international political economy is interested not only in those
subjects but also in a broader range of issues. IPE is particularly interested in the distribution of gains
from market activities; neoclassical economics is not. Although, at least over the long term, every society
gains absolutely from the efficient functioning of international markets, the gains are seldom distributed
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equally among all economic actors, and states generally are very much concerned over their own relative
gains. Whereas economists regard markets as self-regulating mechanisms isolated from political affairs,
specialists in IPE are interested in the fact that the world economy has a considerable impact on the
power, values, and political autonomy of national societies. States have a strong incentive to take actions
that safeguard their own values and interests, especially their power and freedom of action, and they also
attempt to manipulate market forces to increase their power and influence over rival states or to favor
friendly states.
Whereas economists and economic analysts are generally indifferent to the role of institutions in
economic affairs (due to their focus on the market), the nature of the international institutions and those
international regimes that govern international markets and economic activities constitute a central
concern of international political economists. As regimes may significantly affect the distribution of gains
from economic activities and the economic/political autonomy of individual states, states—especially
powerful states—attempt to influence the design and functioning of institutions in order to advance their
own political, economic, and other interests. Thus, the study of international political economy presumes
that states, multinational corporations, and other powerful actors attempt to use their power to influence
the nature of international regimes.
Distribution of Wealth and Economic Activities
Whereas the science of economics emphasizes the efficient allocation of scarce resources and the absolute
gains enjoyed by everyone from economic activities, state-centric scholars of international political
economy emphasize the distributive consequences of economic activities. According to economics,
exchange takes place because of mutual gain; were it otherwise, the exchange would not occur. IPE‗s
state centric interpretation, on the other hand, argues that economic actors are attentive not only to
absolute but also to relative gains from economic intercourse; that is, not merely to the absolute gain for
themselves, but also to the size of their own gain relative to gains of other actors. Governments are
concerned about the terms of trade, the distribution of economic returns from foreign investment, and, in
particular, the relative rates of economic growth among national economies. Indeed, the issue of relative
gains is seldom far from the minds of political leaders.
The significance of relative gains for economic behavior and in the calculations of nation-states was
recognized at least as early as the economic writings of the eighteenth-century political philosopher David
Hume (1711–1776). Hume‗s mercantilist contemporaries argued that a nation should seek a trade and
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payments surplus, basing their arguments on the assumption that it was only relative gains that really
mattered. In today‗s language of game theory, international commerce during the mercantilist era was
considered to be a zero-sum game in which the gain to one party necessarily meant a loss to another.
Hume himself demonstrated the folly and self-defeating nature of this mercantilist argument by
introducing the ―price-specie flow mechanism‖ into economic thought. Subsequently, formulation by
David Ricardo (1772–1823) of the law or principle of comparative advantage revealed that every nation
could gain in absolute terms from free trade and from an international division of labor based on
territorial specialization. Subsequent modifications of Ricardo‗s theory suggested that states were also
interested in the relative gains from trade. Ricardo‗s demonstration that international economic exchange
was not a zero-sum game but rather a positive-sum game from which everyone could gain led Paul
Samuelson to call the law of comparative advantage ―the most beautiful idea‖ in economic science.
However, both absolute gains and the distribution of those gains are important in international economic
affairs.
A number of political economists have addressed the issue of absolute versus relative gains in
international affairs, and the ensuing debate has largely centered on Joseph Grieco‗s argument that states
are more concerned about relative than absolute gains and that this creates difficulties in attaining
international cooperation. Although I know of no political economist who dismisses altogether the role of
relative gains in international economic affairs, scholars of IPE do differ on the weight each gives to
relative versus absolute gains. Whereas many scholars stress the importance of relative gains, liberals
emphasize the importance of absolute gains and believe that Grieco has overstated the significance of
relative gains. Absolute gains, they argue, are more important than Grieco‗s analysis suggests, and
therefore international cooperation should be easier to attain than he postulates. While Grieco‗s emphasis
on the importance of relative gains is, I believe, basically important, and states do, in general, prize
relative gains, sometimes even at the expense of absolute gains, this argument cannot be elevated into a
general law of state behavior.6 One can say about this generalization in political economy no more than
Kindleberger has said of most generalizations in economics: ―It depends!‖
The importance of absolute versus relative gains in state calculations is actually highly dependent upon
the circumstances in which a specific trade-off occurs. While it may be true that states can never be
totally unconcerned about the distributive consequences of economic activities for their relative wealth
and power, they frequently do, largely for security reasons, ignore this concern in their dealings with
others. During the height of the Cold War, for example, the United States fostered the economic
unification of Western Europe for political reasons despite the costs to its own economic interests.
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Kenneth Waltz has noted that the conscious decision of the United States in the late 1940s to build the
power of its European allies at a sacrifice to itself was a historically unprecedented action.
States are particularly interested in the distribution of those gains affecting domestic welfare, national
wealth, and military power. When a state weighs absolute versus relative gains, military power is by far
the most important consideration; states are extraordinarily reluctant, for example, to trade military
security for economic gains. Modern nation-states (like eighteenth-century mercantilists) are extremely
concerned about the consequences of international economic activities for the distribution of economic
gains. Over time, the unequal distribution of these gains will inevitably change the international balance
of economic and military power, and will thus affect national security. For this reason, states have always
been very sensitive to the effects of the international economy on relative rates of economic growth. At
the beginning of the twenty-first century, concern is focused on the distribution of industrial power,
especially in those high-tech industries vitally important to the relative power position of individual
states. The territorial distribution of industry and of technological capabilities is a matter of great concern
for every state and a major issue in international political economy.
National Autonomy
One of the dominant themes in the study of international political economy (IPE)is the persistent clash
between the increasing interdependence of the international economy and the desire of individual states to
maintain their economic independence and political autonomy. At the same time that states want the
benefits of free trade, foreign investment, and the like, they also desire to protect their political autonomy,
cultural values, and social structures. However, the logic of the market system is to expand geographically
and to incorporate more and more aspects of a society within the price mechanism, thus making domestic
matters subject to forces external to the society. In time, if unchecked, the integration of an economy into
the world economy, the intensifying pressures of foreign competition, and the necessity to be efficient in
order to survive economically could undermine the independence of a society and force it to adopt new
values and forms of social organization. Fear that economic globalization and the integration of national
markets are destroying or could destroy the political, economic, and cultural autonomy of national
societies has become widespread.
The clash between the evolving economic and technical interdependence of national societies and the
continuing compartmentalization of the world political system into sovereign independent states is one of
the dominant motifs of contemporary writings on IPE. Whereas powerful market forces (trade, finance,
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and investment) jump political boundaries and integrate societies, governments frequently restrict and
channel their economic activities to serve the interests of their own societies and of powerful groups
within those societies. Whereas the logic of the market is to locate economic activities wherever they will
be most efficient and profitable, the logic of the state is to capture and control the process of economic
growth and capital accumulation in order to increase the power and economic welfare of the nation. The
inevitable clash between the logic of the market and the logic of the state is central to the study of
international political economy.
Most economists and many political economists believe that the international economy has a positive
impact on international political affairs. The international economy, many argue, creates webs of mutual
interdependence and common interests that moderate the selfcentered behavior of states. Underlying this
benign interpretation is a particular definition of economic interdependence as dependence. However, as
Albert Hirschman pointed out in National Power and the Structure of Foreign Trade (1969), while
economic interdependence may be characterized by mutual dependence, dependence is frequently not
symmetrical. Trade, investment, and markets establish dependencies among national societies that can be
and are exploited. Integration of national markets creates power relations among states where, as
Hirschman notes, economic power arises from the capacity to interrupt economic relations.9 Economic
ties among states almost always involve power relations.
Robert Keohane and Joseph Nye (1977) extended this analysis of economic power and the political
aspects of economic interdependence by distinguishing ―sensitivity‖ interdependence from
―vulnerability‖ interdependence. Most economists really are referring to sensitivity interdependence
exemplified by responsiveness among economic variables, such as changes in interest rates in one country
that influence interest rates in another. Vulnerability interdependence, on the other hand, is what
Hirschman and political economists frequently have in mind when they speak of economic
interdependence; this latter term refers to the possibilities of political exploitation of market
interdependencies. Individual states have a powerful incentive either to decrease their own dependence on
other states through such policies as trade protection and industrial policies or to increase the dependence
of other states upon them through such policies as foreign aid and trade concessions. International
economic relations are never purely economic; they always have profound implications for the economic
autonomy and political independence of national societies.
The Politics of International Regimes All economists and political economists acknowledge the need for
some minimal rules or institutions to govern and regulate economic activities; even the most ardent
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public-choice economist would agree that laws are needed to enforce contracts and protect property
rights. A liberal international economy—that is, an international economy characterized (at least in ideal
terms)by such factors as open markets, freedom of capital movement, and nondiscrimination—certainly
needs agreed-upon rules. A liberal economy can succeed only if it provides public goods like a stable
monetary system, eliminates market failures, and prevents cheating and free-riding. Although the primary
purpose of rules or regimes is to resolve economic problems, many are actually enacted for political
rather than for strictly economic reasons. For example, although economists may be correct that an
economy benefits from opening itself to free trade whether or not other countries open their own markets
to it, a liberal international economy could not politically tolerate too many free-riders who benefit from
the opening of other economies but refuse to open their own markets.
In the past, the rules governing the international economy were quite simple and informal. Insofar as the
implicit rules were enforced at all, they were enforced by the major powers whose interests were favored
by those rules. For example, in the nineteenth century under the Pax Britannica, overseas property rights
were frequently upheld by British ―gunboat diplomacy,‖ and the international gold standard, based on a
few generally accepted rules, was managed by the Bank of England. Now, formal international
institutions have been created to manage today‗s extraordinarily complex international economy. The
most important institutions are the Bretton Woods institutions such as the World Bank, the International
Monetary Fund, and the World Trade Organization. The world economy would have difficulty
functioning without these institutions. Therefore, understanding their functioning has become an
extremely important concern of political economists.
The concept of international regimes, defined as ―sets of implicit or explicit principles, norms, rules, and
decision-making procedures around which actors‗ expectations converge in a given area of international
relations,‖ has been at the core of the research on international institutions.14 Although a distinction can
be made between an international regime as rules and understandings and an international institution as a
formal organization, the word ―regimes‖ and the word ―institutions‖ are frequently used
interchangeably in writings on international political economy. Moreover, what is really important for the
functioning of the world economy are the rules themselves rather than the formal institutions in which
they are usually embodied. To simplify the following discussion, I shall use ―international regime‖ to
encompass both rules and such formal international organizations as the International Monetary Fund or
the General Agreement on Tariffs and Trade.
Robert Keohane has been the most influential scholar in the development of regime theory. In his book,
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After Hegemony (1984), Keohane set forth the definitive exposition and classic defense of regime theory.
He argues that international regimes are a necessary feature of the world economy and are required to
facilitate efficient operation of the international economy. Among the tasks performed by regimes are
reduction of uncertainty, minimization of transaction costs, and prevention of market failures.
International regimes are created by self-centered states in order to further both individual and collective
interests. Even though a particular regime might be created because of the pressures of a dominant power
(or hegemon), Keohane argues that an effective international regime takes on a life of its own over time.
Moreover, when states experience the success of an international regime, they ―learn‖ to change their
own behavior and even to redefine their national interests. Thus, according to Keohane‗s analysis,
international regimes are necessary to preserve and stabilize the international economy.
From its beginning, regime theory has been surrounded by intense controversy. One major reason for the
intensity of this debate is that regime theory arose as a response to what Keohane labeled ―the theory of
hegemonic stability.‖ Proponents of the latter theory had argued that the postwar liberal international
economy was based on the economic and political leadership of the United States. Some theorists had
argued that the hegemonic stability theory also suggested that the relative decline of American power due
to the rise of new economic powers and the slowing of American productivity growth in the early 1970s
placed the continued existence of a liberal world economy in jeopardy. As Steven Weber has pointed out,
regime theory was largely a response to the perceived decline of American power, the 1973 energy price
shock, and the global ―stagflation‖ of the 1970s. Keohane and others argued that international regimes
and cooperation among the major economic powers would replace declining American leadership as the
basis of the liberal international economic order. Thus, the political purpose of regime theory was, at least
in part, to reassure Americans and others that a liberal international order would survive America‗s
economic decline and the severe economic problems of the 1970s.
British scholar Susan Strange was the most outspoken critic of regime theory. According to Strange,
regime theory was at best a passing fad, and at worst a polemical device designed to legitimate America‗s
continuing domination of the world economy. Strange and other critics alleged that such international
regimes as those governing trade and monetary affairs had been economically, politically, and
ideologically biased in America‗s favor, and that these regimes were put in place by American power,
reflected American interests, and were not (as American regime theorists have argued)politically and
economically neutral. Strange charged that many of the fundamental problems afflicting the world
economy actually resulted from ill-conceived and predatory American economic policies rather than
simply being symptoms of American economic decline.
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Strange‗s foremost example of American culpability was the huge American demand in the 1980s and
1990s for international capital to finance America‗s federal budget and trade/payments deficit. Through
use of what she referred to as ―structural power‖ (such as America‗s military, financial, and
technological power), she alleged that the United States continued to run the world economy during that
period and made a mess of it. Strange and other critics also alleged that the role of the dollar as the key
international currency had permitted the United States to behave irresponsibly. More generally, Strange
and other foreign critics charged that the American discipline of international political economy, and
regime theory in particular, have been little more than efforts to defend America‗s continuing desire to
reign economically and politically over the rest of the world. Whether or not we accept these criticisms,
they should remind us that regimes and other social institutions are sometimes created to preserve
inequalities as well as to improve coordination and overcome other obstacles to mutually beneficial
cooperation. It is desirable to study such important issues as the origins of international regimes, the
content, rules, and norms of international regimes, and the history of compliance by affected states,
particularly in situations when a regime is perceived as being counter to a state‗s interests.
Origins
International regimes have developed in a number of different ways. Some have arisen spontaneously and
do not involve conscious design; many of the informal rules governing markets are of this type. Others
have resulted from international negotiations among states; the post– World War II Bretton Woods
system of trade and monetary regimes, for example, was the result of international negotiations, primarily
between the United States and Great Britain. Still other regimes have been imposed by powerful states on
less powerful ones; the colonial systems of the nineteenth century are a notorious example. This section
will concentrate upon regimes created through international negotiations, especially the Bretton Woods
regimes for trade and monetary affairs that were the result of American leadership.
In creating the post–World War II regimes, the most important task for American leadership was to
promote international cooperation. The United States undertook the leadership role, and other economic
powers (Canada, Japan, and Western Europe) cooperated for economic, political, and ideological reasons.
These allies believed that a liberal world economy would meet their economic interests and also solidify
their alliance against the Soviet threat. In addition, cooperation was greatly facilitated by the fact that
these nations shared an ideological commitment to a liberal international economy based on free trade and
open markets. All three factors—leadership, cooperation, and ideological consensus—were important to
creation of the post–World War II liberal international economy.
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Content
The content of an international regime—the precise rules and decision- making techniques embodied in a
particular regime—is determined by technological, economic, and political factors. An international
regime could not function well if its rules were counter to scientific and technological considerations.
Regimes governing international economic affairs must be based on sound economic principles and must
be able to solve complex economic matters. The postwar international monetary regime based on fixed
exchange rates, for example, had to solve such difficult technical problems as provision of international
liquidity and creation of an adjustment mechanism for nations with balance of payments problems.
Economists, however, seldom agree on such complex issues; there are, for example, several competing
theories on the determination of exchange rates. It is important to realize that the specific means chosen to
solve a given economic problem may have significant consequences for individual states and/or may
impinge on their national autonomy. In the early postwar monetary system, the central role of the U.S.
dollar as a reserve and transaction currency greatly facilitated financing of American foreign policy. Thus,
while the content of an international regime must be grounded on sound technical and economic
considerations, it is important to recognize that regimes do produce political effects.
A number of regime theorists have a tendency to think of regimesas benign. Regime theory has
emphasized the efficiency and efficacy of international cooperation and problem-solving and that regimes
are instituted to achieve interstate cooperation and information sharing, to reduce transaction costs, and to
solve common problems. While these goals do exist, it is also true, as some scholars of institutions point
out, that institutions—and regimes—do create or preserve inequalities; regimes can also have a
redistributive function. History is replete with such examples as the carving-up of Africa at the Congress
of Berlin (1878) and the post–World War I mandate system. The purpose, content, and actual
consequences of every international regime must be closely examined; there should be no assumption that
regimes are ipso facto of equal or mutual benefit to every participant.
Because international regimes frequently do have distributive consequences as well as implications for
national autonomy, the rules, norms, and other factors embedded in regimes generally reflect the power
and interests of the dominant power/s in the international system. Certainly, the liberal trade and
monetary regimes following World War II promoted the economic and, I would emphasize, the political
and security interests of the United States while also strengthening the anti-Soviet political alliance.
Moreover, as American interests changed, the United States used its power to modify one or another of
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these regimes; the August 1971 Nixon decision to destroy the system of fixed exchange rates because he
believed that it no longer suited American interests provided a particularly striking example of this type of
behavior.
Nevertheless, it is unlikely that the regimes governing a liberal international economy do or will represent
the interests of the dominant power/s alone and of no others. Liberal international regimes must satisfy
the interests of all the major economic powers to at least some degree; if they do not, the regimes would
neither function nor long survive. The major trading partners of the United States were satisfied with the
postwar trade regime and, in fact, benefited economically from the regime more than did the United
States. Although a liberal international economic order does reflect the interests of a dominant power,
such a power cannot impose a liberal economic order on the rest of the world; ultimately, the regime must
rest on international cooperation.
Compliance
although some scholars deny, or at least minimize, the importance of the compliance issue, compliance
with international regimes is a major problem, and it is important to understand the reasons for
compliance or noncompliance. The compliance or enforcement problem arises because there is no
authoritative international government, because states frequently value highly their relative gains and
national autonomy, and because there is a collective action problem in which individual actors are
tempted to cheat and free ride. While the compliance problem may be of minor significance in many or
even the majority of international regimes, when the rules and principles of an international regime have
significant distributive consequences for states and powerful domestic groups, or when they impinge
significantly on the autonomy and security of states, the compliance problem becomes of overwhelming
importance. Many of the international regimes governing the world economy, in fact, are of this latter
type, because they do have important consequences for the distribution of global wealth and national
autonomy.
Scholars of international political economy have devoted considerable attention to possible solutions to
this problem. An important proposed solution is based on the theory of iterative (or repeated) games and,
in particular, on what game theorists call the Prisoner‗s Dilemma. Another is based on insights from the
new institutionalism or ―new economics of organization.‖ These approaches fall within the larger
category of ―theories of international cooperation.‖ Most scholars of international political economy
would accept the definition made popular by Robert Keohane that cooperation occurs ―when actors
adjust their behavior to the actual or anticipated preferences of others, through a process of policy
coordination.‖ Although theories of cooperation may be helpful in explicating the nature and difficulties
of the compliance problem, they do not really solve the problem.
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The Prisoner‗s Dilemma is undoubtedly familiar to most readers of this book. Nevertheless, I shall
provide a brief reminder: Two prisoners are accused of a crime and held separately. If they both confess
to the crime of which they are accused, they will both be punished. If neither confesses—that is, if in
essence they cooperate with one another— they will both be punished, but less severely. However, if only
one confesses (or defects) and the other does not confess, the latter will be punished more severely. Thus,
although each has an incentive to cooperate with the other by not confessing, each also has an incentive to
confess (defect). Uncertainty regarding what the other player will do could lead to a less than optimal
outcome for both players.
This type of mixed motive game in which the players have a motive to cooperate and also a motive to
defect is characteristic of almost every aspect of international politics and certainly of international
economic affairs. Although the players would gain from cooperation, each might gain even more by
defecting (cheating); yet both would lose if both cheat. For example, a nation might be able to increase its
own relative gains in the international trading regime by exporting to other markets at the same time that
it keeps its own markets closed; however, if others retaliate and close their markets, everyone would lose.
In a monetary regime, a nation could increase its international competitiveness by unilaterally devaluing
its own currency. However, if other countries simultaneously devalue their own currencies, everyone
loses. Therefore, everyone is better off, at least in absolute terms, as a result of cooperation. Yet the
possibility of increasing one‗s own relative gains by cheating or successfully ―free-riding‖ always
provides a powerful temptation in international affairs.
A number of attempts have been made by economists and other scholars to solve the Prisoner‗s Dilemma.
Proposed solutions entail methods or techniques designed to increase the likelihood that players will
cooperate and not cheat; they include creation of norms of reciprocity, making each move in the game
less distinct, and linking issues to one another. Such techniques attempt to lessen the incentive to cheat in
a particular instance so that the players learn how to cooperate. The most noteworthy effort to solve the
Prisoner‗s Dilemma has been the concept of iterative games developed by Robert Axelrod and others.
This concept leads to the conclusion that, if a game is repeated over and over again and a participant
pursues a ―tit-for-tat‖ strategy in which cooperative moves are rewarded and uncooperative moves are
punished, the participants in the game will learn to trust and cooperate with one another.
The literature on the theory of repeated or iterative games has become extensive and has been subjected to
intense theoretical criticism and defense. Although scrutiny of the theory has vastly increased our
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understanding of the compliance problem, this scholarly debate has not yet enabled us to predict when
cooperation or defection from (cheating)a regime will in fact occur. The fundamental problem of
uncertainty and hence of regime compliance has not yet been solved and probably never will be; a player
can never be absolutely sure whether another player will cooperate or defect, and the costs of
miscalculation could be extremely high. The absence of an adequate body of research on the actual
functioning of specific regimes makes it impossible to be confident that regimes are of decisive
importance in the behavior of states. In addition, a fundamental methodological problem makes it difficult
to determine whether or not regimes actually make a difference in the conduct of international affairs. As
one strong supporter of regime theory has stated, ―Investigating the consequences of international
regimes
requires a counterfactual argument,‖ that is, knowledge of what would happen if the regime did not exist.
The ―new economics of organization,‖ or what some scholars prefer to label ―neoinstitutionalism,‖ has
produced another important effort to solve the compliance problem. This theory of international
cooperation has been described by George Downs and David Rocke as ―a loose composite‖ of
transaction-cost economics and non-cooperative game theory. According to new institutionalism, regimes
can provide a solution to such problems as market inefficiencies, economic uncertainties, and market
failures. However, as Downs and Rocke point out, this theory of international cooperation makes only a
limited contribution to solution of the compliance problem, and compliance with international regimes
ultimately rests on the domestic and, I would add, the foreign policy interests of individual states.
Despite its important insights into the functioning of the world economy, regime theory frequently
sidesteps problems of national autonomy and interests. For example, every nation joining an international
regime reserves the right to withdraw from the regime if its interests change. In addition, concerns over
national autonomy place severe limits on the types of international regimes that are created. Even in the
North Atlantic Treaty Organization (NATO), each member reserves the right not to come to the aid of
another alliance member if the other is attacked.
The increasing importance of social welfare in state behavior has not substantially changed matters,
although many scholars of international political economy have suggested that it has. As James Mayall
points out, international regimes have resulted in few, if any, sacrifices of domestic social welfare.
Despite much talk of international distributive justice, for example, voluntary sharing by one society of a
substantial portion of its wealth with other societies is rare indeed. Foreign aid, for example, has never
absorbed more than a small percentage of a nation‗s GDP, and with a few notable exceptions such aid has
been and is given for national security or economic (rather than humanitarian)reasons. The modern
welfare system has actually made states even more attentive to their own economic interests. The
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nationalistic nature of the modern welfare state is well demonstrated by the singular fact that every state
severely restricts immigration, at least in part to restrict access to its welfare system.
While international regimes are useful to provide solutions to technical, economic, and other problems
associated with the world economy, they also invariably affect the economic welfare, national security,
and political autonomy of individual states. For this reason, states frequently attempt to manipulate
regimes for their own parochial economic and political advantage. This concept of international regimes
as both technical solution and arena of political struggle diverges from that held by many economists and
liberal scholars of political economy that regimes are economically and politically neutral. The realist
interpretation maintains that international regimes are neither above nor outside the struggle for power
and advantage among states. Regimes are both a part and an object of a political struggle. As a
consequence, if a regime is to be effective and its rules are to be enforced, it must also rest on a strong
political base. Due to the central importance of distribution and autonomy issues to most nations, the
compliance problem is unlikely to be resolved, and regime rules are unlikely to be enforced unless there is
strong international leadership.
Theory of Hegemonic Stability
The theory of hegemonic stability, discussed below, in both its liberal and its realist versions, encountered
a critical reception from a number of scholars. The theory was attacked on theoretical, historical, and
political grounds. The theoretical criticisms emphasized the possibility of a cooperative solution among
nonhegemonic nations to the problems associated with creating and maintaining a liberal international
economy. Although it may be possible to create a stable liberal international order through cooperation
but without a hegemon, this has never happened, and with no counterfactual example neither the theory
nor its critics can be proved wrong. This problem, of course, is endemic in many areas of the social
sciences. Some critics of the theory have tested it against late-nineteenth-century experience and found
weaknesses in the theory. Political criticisms have ranged from denunciations of the theory as a defense
of or rationale for American policies to the opposite idea that the theory predicted the absolute decline of
the United States. No proponent of hegemonic stability theory, at least to my knowledge, has been
motivated to justify American behavior; to the contrary, most were very critical of the self-centered and
irresponsible American behavior that began in the 1960s, if not earlier.
A major reason for the criticisms of the theory by political scientists is that it was never adequately
formulated. Indeed, the ―theory‖ was more an intuitive idea based on a particular reading of history than
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a scientific theory. Because the theory was underdeveloped, it was open to both warranted and
unwarranted criticisms. A number of critics, for example, interpreted the theory to mean that a dominant
power is necessary to the emergence of a liberal international economy; they have gone on to make the
point that Soviet hegemony did not create a liberal Soviet-dominated international economy. However, as
I have emphasized in numerous writings, a liberal international economy requires a hegemon committed
to liberal economic principles, as Great Britain was in the nineteenth century and the United States was in
the twentieth century; the theory was never intended to suggest that a Soviet Union, Nazi Germany, or
militaristic Japan would promote a liberal world economy. Moreover, despite the implied criticisms of
some authors, the theory, at least in my opinion, posited that a hegemon is a necessary but not a sufficient
condition for establishment of a liberal international economy. It is possible, as some critics have argued,
that a hegemon‗s interests would be best served by an optimum tariff; yet, such an aggressive tactic would
be a highly unlikely course of action for a strong liberal power such as Great Britain or the United States.
Instead, the theory rests on the idea of international cooperation. Hegemony makes cooperation more
feasible and is not, as some have suggested, opposed to cooperation.
The strongest support for the theory, or at least for the idea that strong leadership is necessary, has come
from economists. This endorsement is rather amazing, because economists (with the notable exception of
Kindleberger)are likely to argue that markets by themselves will manage the world economy. The most
detailed and systematic empirical critique of HST by an economist is that of economic historian Barry
Eichengreen (1989).39 However, support for the theory was not the purpose avowed by Eichengreen; in
fact, he believed that he had refuted the theory. Through examination of the historical record, Eichengreen
tried to discover whether or not a hegemon had played a determining role in the rise and maintenance of
an open world economy. He inquired specifically into the roles of Great Britain in the late nineteenth
century and of the United States in the post– World War II era, particularly regarding the genesis and
functioning of the international monetary system. Although he concluded that the record gave only
modest support to the theory, his analysis actually supports its validity.
Eichengreen‗s lukewarm assessment of the theory appears to rest on the erroneous assumption that the
hegemon must be an imperialistic power that imposes its will on other countries. His language suggests
that he identifies hegemony with coercion and imposition of the hegemon‗s will on other countries.
Throughout his analysis, he uses such terms as ―dictating,‖ ―force,‖ and ―coerced‖ to describe the
actions of the British and American hegemons. Yet, no proponent of the theory has used such language,
but instead each has emphasized the essential leadership role of the hegemon in promoting international
cooperation. In fact, Eichengreen‗s analysis itself confirms that the British and American hegemons
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―significantly influenced‖ the nature of the international monetary system through promotion of
international cooperation. Without a hegemon, international cooperation in trade, monetary, and most
other matters in international affairs becomes exceptionally difficult, if not impossible, to achieve.
Four years later (1993), Eichengreen again evaluated the theory of hegemonic stability from the
perspective of historical experience. Whereas his earlier analysis had focused on the international
monetary system, this subsequent evaluation considered the international trading system. He stated that
there was a positive association between hegemony and trade liberalization. Comparing the nineteenth
century and post–World War II experiences, Eichengreen concluded that ―the only example of
successful multilateralism the historical record provides coincides with a period of exceptional economic
dominance by a single power. And the growing difficulties of the GATT have coincided, of course, with
US relative . . . economic decline.‖ He then goes on to ask, ―Why might this be?
Eichengreen drew upon cartel theory to explain why a hegemon facilitates international cooperation:
―Simple cartel theory suggests that it is possible to deter defection from a cartel containing many
members only when there is a dominant firm capable of acting as enforcer. In its absence, duopolies of,
say, neighboring firms may be the most that monitoring and enforcement capabilities can support. This
suggests that the growing prevalence of bilateralism is a corollary of the increasingly multipolar nature of
the world economy.‖41 Thus, Eichengreen has set forth a plausible explanation of why the decline of
American leadership has contributed to the increasing importance of bilateral negotiations and regional
arrangements in the world economy.
Other leading economists have also supported the validity of the theory. For example, Nobel Laureate
Robert Mundell, a distinguished expert on international monetary and financial affairs, has pointed out
that the stability of the international monetary system is dependent upon a dominant power. Other
international economists such as Robert Baldwin and Swiss economist Bruno Frey have also written in
support of the idea that a hegemon is necessary. Baldwin writes, for example, that the hegemonic role
played by the United States increased the economic welfare of most non-Communist countries. According
to Frey, public choice theory suggests that it is impossible for public goods to be provided if there is no
hegemon.
One of the most interesting arguments supporting the necessity of a hegemon was set forth by Mancur
Olson. Olson‗s views are especially apposite because of his innovative work on provision of collective
goods and the fact that many critics of the theory cite his work to support their own criticisms.
Commenting on provision of the collective good of free trade, Olson presents an ingenious theory based
on domestic politics to explain why it is so difficult for a country to reduce trade barriers unilaterally and
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in the absence of external pressures exerted by a powerful state. He then concludes, ―Thus the world
works better when there is a ‗hegemonic‗ power—one that finds it in its own self-interest to see that
various international collective goods are provided.‖ He continues, ―Naturally, the incentive a
hegemonic
power has to provide international collective goods diminishes as it becomes relatively less important in
the world economy. In the United States, there has been a conspicuous resurgence of protectionist
thinking, and a diminishing willingness of the country to provide foreign aid, as the American economy
has come to encompass relatively less of the world economy.‖ From this perspective, the emergence of
new industrial powers and new exporters of manufactured goods has resulted in increased American
protectionist policies, beginning with the New Protectionism in the mid-1970s and with the shift to a
greater emphasis on economic regionalism made manifest in the 1994 formation of the North American
Free Trade Agreement.
Lack of a counterfactual makes it impossible either to validate or refute the theory of hegemonic stability,
but Eichengreen‗s empirical examination of the theory, the supportive commentary of other economists
and political scientists, and the theoretical writings of Olson and others lend considerable support to its
validity. For these reasons, even though the hegemonic stability theory (HST) does not provide a
foolproof account of the eras of British and American leadership of the world economy, it does hold up
quite well by the standards of the social sciences, including economics.
Governance of the Global Economy
Creation of effective international regimes and solutions to the compliance problem require both strong
international leadership and an effective international governance structure. Regimes in themselves
cannot provide governance structure because they lack the most critical component of governance—the
power to enforce compliance. Regimes must rest instead on a political base established through leadership
and cooperation. Although many liberal scholars consider the concepts of hegemony and of regimes to be
incompatible or even opposed to one another, regimes governing economic affairs cannot function
without a strong leader or hegemon. The theory of hegemonic stability posits that the leader or hegemon
facilitates international cooperation and prevents defection from the rules of the regime through use of
side payments (bribes), sanctions, and/or other means but can seldom, if ever, coerce reluctant states to
obey the rules of a liberal international economic order.
The American hegemon did indeed play a crucial role in establishing and managing the world economy
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following World War II; strong support and cooperation were provided by the Cold War allies of the
United States. Moreover, as Downs and Rocke point out, regime compliance ultimately is dependent on
domestic support. Post–World War II regimes rested on what John Ruggie called ―the compromise of
embedded liberalism,‖ in which governments may and do intervene in their domestic economies to
promote full employment but must also conform to internationally agreed-upon rules. Postwar trade
liberalization was politically acceptable because governments pursued policies to guarantee full
employment and to compensate those harmed by the opening of national markets to international trade.
Solution of the governance problem was, for decades, achieved through leadership, international
cooperation, and domestic consensus.
The idea that a liberal international economy requires strong political leadership by the dominant
economic power was initially set forth by Charles Kindleberger in The World In Depression, 1929–1939
(1973).49 According to Kindleberger, the scope, depth, and duration of the Great Depression were more
severe because there was no leader to carry out several tasks necessary for the world economy to function
properly. Some of these tasks must be performed even in normal times; others are needed in a crisis. In
normal times a leader must (1) maintain the flow of capital to poor countries, (2)provide some order in
foreign exchange rates, at least among the key currencies, and (3) arrange for at least moderate
coordination of macroeconomic policies among the leading economies. In times of crisis, the leader, in
Kindleberger‗s words, must provide ―open markets for distressed goods in depression and be a source of
extra-supply when goods are tight, as in the oil crises of 1973 and 1979. The economic leader must also
be a ‗lender of last resort‗ in the event of a serious international financial crisis. Lacking a leading
country able and willing to discharge these functions, financial crises can be followed by prolonged
depressions as happened in the 1930s. In short, the functions of the leader are capital lending, creation of
a foreignexchange regime, macroeconomic coordination, maintaining open markets, and being the
‗lender of last resort.‗‖ Stephen Krasner and I each appropriated Kindleberger‗s basic idea that a political
leader was needed to create and manage an international liberal economy. However, each of us made
several modifications that placed Kindleberger‗s insight within a state-centric intellectual framework of
political analysis and thus fashioned a state-centric version of the theory of hegemonic stability. Both of
us used the Greek word ―hegemon‖ rather than ―leader‖ to indicate that at times the leader had to
exercise power to achieve its objective of establishing and managing a liberal world economy. A
hegemon is defined as the leader of an alliance like that organized by Sparta to defeat the Persian invaders
in ancient Greece or by the United States to defeat the Soviets. Whereas Kindleberger argued that the
leader created a liberal international economy for both its own and cosmopolitan economic reasons,
Krasner and I have both argued that the hegemon created a liberal international economy primarily to
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promote its own interests and its political/security interests in particular. Both of us have acknowledged
that these security interests could also include the economic and military interests of allies.
When the United States played a central role in promoting an open and interdependent international
economy (composed mainly of the United States and its allies)in order to strengthen the anti-Soviet
alliance, America‗s motives were hardly altruistic. Nevertheless, despite the differences between
Kindleberger‗s liberal version of the hegemonic stability theory and the Krasner/Gilpin state-centric
version, both approaches maintain that provision of such international public goods as free trade and
monetary stability requires a dominant power with an interest in a liberal world economy and a
willingness to expend economic and political resources to achieve and maintain that goal.
The theory of hegemonic stability maintains that there can be no liberal international economy unless
there is a leader that uses its resources and influence to establish and manage an international economy
based on free trade, monetary stability, and freedom of cap ital movement. The leader must also
encourage other states to obey the rules and regimes governing international economic activities. The
theory assumes that a liberal international economy requires that certain ―public goods‖ will be
promoted
by the leader. A public good, as originally defined by Paul Samuelson, has the properties of
―nonexcludability‖ (inclusiveness) and nonrivalrous consumption. This rather obtuse jargon means that
any individual‗s consumption of a public good does not affect (decrease) consumption of the good by
others, and that no one can be prevented from consuming the good whether or not he or she has paid for
it. A lighthouse, of benefit to every ship whether or not the ship has contributed to the upkeep of the
lighthouse, fulfills such criteria. In such a situation, individuals (and individual nations) have an incentive
to free ride—to take advantage of the public good without paying for it—since no one can be excluded
from enjoying the good. This means that public goods will generally be under supplied because few
actors will have an incentive to pay the costs of providing such goods.
The public goods associated with a liberal international economy include an open trading system and a
stable international monetary system. However, there are even greater tendencies toward free riding and
for international public goods to be undersupplied within the international economy than in domestic
affairs. This problem can, at least in theory, be overcome by a small group of cooperating states; however,
I know of no example of this type of cooperation on such a large scale as the world economy. In practice,
public goods have been and can be provided only by a leader (or hegemon) with an interest in supplying
the good for all or in forcing others to share payment for the good.
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A brief examination of the British and American eras of international leadership increases comprehension
of the dynamics of the rise and erosion of a liberal world economy; both eras of economic liberalism
required a hegemonic power. From the mid-nineteenth century to the outbreak of World War I, Great
Britain led the efforts for trade liberalization and monetary stability; the United States has led the world
economy since World War II. The liberal world economy in the late nineteenth century was truly global
and was generally characterized by nondiscrimination in trade, unrestricted capital movements, and a
stable monetary system based on the gold standard. For decades the American system was composed only
of the Free World; during the Cold War it was characterized by trade discrimination, by capital controls
until the 1970s, and by monetary instability after 1971. Whereas the British promoted and inspired free
trade by example and through a series of bilateral agreements, the United States has championed trade
liberalization through multilateral negotiations within the GATT. Although there is disagreement on this
subject, according to Joanne Gowa, security concerns did influence British trade policy. Certainly,
international security considerations—forging the Western alliance against the Soviet Union—played an
extremely important role in America‗s promotion of free trade. In the monetary realm, the Bank of
England played a central role in management of the gold standard in the nineteenth-century system.
However, even though the post–World War II international monetary system has been based on the dollar
and subject to American influence, the Federal Reserve has had to share pride of place with the German
Bundesbank and other powerful central banks.
British economic decline began in the late nineteenth century as other countries, especially Germany and
the United States, industrialized; Britain responded with a gradual retrenchment of its global position and
initiation of numerous measures to strengthen its security. Although Great Britain modified a number of
its economic policies, its huge dependence on trade forestalled a retreat into protectionism. Nevertheless,
British leadership in trade liberalization did slacken, and by the 1930s Britain had retreated to a system of
imperial preferences applied to the colonial empire and Commonwealth members. As early as the mid-
1970s, American political leaders, business interests, and scholars expressed strong concerns over the
relative decline and deindustrialization of the American economy caused by foreign competition,
principally from the Japanese. Such worries produced the New Protectionism. As formal tariffs were
reduced through trade negotiations, the United States erected such nontariff barriers as those embedded in
the Multi-Fiber Agreement (1973), in which many nations were assigned quotas; the United States also
imposed ―voluntary‖ export restraints on Japanese products. Responding to the ballooning American
trade deficit, intensifying fears of deindustrialization, and rising protectionist pressures, the Reagan
Administration in the mid-1980s significantly modified America‗s commitment to multilateralism. It
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began to pursue a multitrack trade policy that has not only deemphasized multilateral negotiations but
also increased unilateralism and bilateralism (especially ―managed trade‖ with Japan) along with
economic regionalism through the North American Free Trade Agreement with Canada and Mexico.
Unit Two
Theories of International Political Economy
2.1 Classical Mercantilism and Economic Nationalism
Terminology
Before discussing the tenets of economic nationalism, and its forebears, it may be helpful to say a few
words on the terminology used in debates about this doctrine. Much confusion results from the fact that in
such debates, both within and without the academy, a number of terms are employed which, on the
surface, seem to have more or less the same meaning. It is important to stress that terms such as
‗mercantilism‗, ‗neo-mercantilism‗, ‗economic nationalism‗, and ‗protectionism‗, are not necessarily
interchangeable. Some authors draw subtle but important distinctions between them.
Mercantilism, economic nationalism and ‗neo-mercantilism‗ are often used to characterise certain
historical periods in the world economy. Generally speaking, from the sixteenth to the late eighteenth
century is known as the mercantilist period (or the period of ‗classical‗ mercantilism). The ‗long
nineteenth century‗ (1815–1914) is known as the economic liberal period or ‗liberal interlude‗. The
1930s are known as the period of economic nationalism. The post-war era from 1945 to the early 1970s is
known as the Bretton Woods era, or that of ‗embedded liberalism‗. The 1980s have been widely termed
the period of ‗neo-mercantilism‗, ‗neo-protectionism‗, or the ‗new economic nationalism‗ due to
increasing resort to novel kinds of protection (especially NTBs to trade such as VERs, anti-dumping
legislation, and discriminatory government procurement policies).
The period since the conclusion of the Uruguay Round of trade talks in the early 1990s, coinciding with
the collapse of communism in the Soviet Union and Eastern Europe, and the deregulation of world
financial markets, has not yet acquired the distinction of having its own appellation. The ‗era of
globalisation‗ might be a good bet. But it is important to note that these ‗isms‗ are also doctrines. That is,
they are more or less coherent and distinct bodies of thought on how international economic relations
actually work and how they should work. Protectionism, however, is the exception. This is not a doctrine
but a general term for a range of measures that states can take to insulate its home market from foreign
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competition. Protectionism is, therefore, far from being synonymous with mercantilism and economic
nationalism. Although wide in variety, protectionist measures – tariffs, quotas, subsidies, anti-dumping
laws, VERs, OMAs – are not the only measures that can be taken by an economically nationalistic or
mercantilist state. Others include currency manipulation, ‗Buy British‗ or ‗Buy Canadian‗-type
campaigns, boycotts, tax holidays, dumping and war.
2.1.1 Classical Mercantilism
Mercantilism is best thought as a set of state policies first and a theory of international political economy
second. Mercantilism is both a theory about how the international political economy works and an
intellectual defense of mercantilist policies. As a body of thought, mercantilism is notoriously scattered
and unsystematic. In fact, it was not even named until Adam Smith did so in the late eighteenth century so
as to attack it. Typical mercantilist practices involved strategic tariffs and restrictions on the export of
money. In every way they were opposed to what came to be known as free trade.
Mercantilist authors were primarily English merchants and French state officials, two groups who stood
strongly to gain from the era‗s state-building policies. In a later period of German state-building, German
political economists made notable contributions. Thomas Mun (1571–1641), British, was perhaps the
most prominent and influential mercantilist writer in Britain during the theory‗s seventeenth-century
heyday. In his popular book ―England‘s Treasure by Forraign Trade‖ published in 1664, he gives that
the purpose of international trade is to increase the ―treasure‖ of a country. When Mun speaks of
England‗s treasure he means gold and silver. From a mercantilist perspective, its accumulation is the
immediate goal of state policy. Mun does not believe that precious metals are themselves wealth, but he
does believe that they are the most important representations of wealth and enablers of national
production and employment that constitute the true foundation of national power and plenty. Because
England is a country with no native gold or silver mines, the only effective means of accumulating
treasure is by exporting more goods than the country imports. Thus, a positive trade balance becomes the
signal object of state policy. Mun recommends a strategic trade policy to accomplish this trade surplus.
Low or zero tariffs should be applied to manufactured exports while high tariffs should be applied to
manufactured imports. Moreover, all English trade should be conducted by English ships so that English
merchants are able to capture the profits yielded through freight charges, insurance, customs duties, and
all the myriad costs of long-distance trade. In Mun‗s view this would bolster domestic production and
employment while also allowing for the accumulation of treasure….The goal of international trade and
state policy is always to maintain a trade surplus, ―the true rule of our Treasure.‖
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Mercantilism is based on the very simple assumption that the international political economy is governed,
first and foremost, by state power. It is opposed to what came to be known as free trade. Classical
mercantilism consists of a set of implicit or explicit beliefs of statesmen, merchants and political
economists that were particularly prevalent from the sixteenth to the late eighteenth century. The
following four beliefs are central. First, classical mercantilists held that the acquisition of wealth is a
vital interest, not only for its own sake but in order to enhance state power. Classical mercantilists argued
that national power and wealth were tightly connected. National power in the international state system is
derived in in large part from wealth. Wealth in turn is required to accumulate power. At a time when wars
were fought by mercenary armies, the size of a state‗s ‗war chest‗ was crucial. Princes and sovereigns
needed a healthy war chest to pursue their ambitions, enhance their power and prestige, and ultimately in
order to survive. Modern-day mercantilists continue to emphasize this relationship, arguing that a
country‗s industrial strength and its security are intimately linked. Secondly, Classical mercantilists
believed that wealth consists of precious metals – the accumulation of gold and silver bullion – and is
therefore finite. It follows from this that one state‗s gain is another state‗s loss and vice versa. Economics
becomes a ‗zero-sum‗ game. Not surprisingly, given these first two beliefs, the pattern of international
economic relations during the mercantilist period was fiercely competitive. Commercial rivalries often
degenerated into war. Jean Baptiste Colbert (1619–83), statesman and finance minister of Louis XIV of
France, described commerce as ‗perpetual combat in peace and war among the nations of Europe as to
who will gain the upper hand‗.
Thirdly, the classical mercantilists argued that trade provided one way for countries to acquire wealth
from abroad. Wealth could be acquired through trade, however, only if the country ran a positive balance
of trade, that is, if the country sold more goods to foreigners than it purchased from foreigners. Thus,
classical mercantilism maintained that the first task of foreign economic policy is to secure a favourable
balance of trade. Colbert said that ‗it is only the abundance of money in a state that makes the difference
as to its greatness and its power‗. As a consequence of this view, exports were encouraged and imports
discouraged. Exports were encouraged to increase the flow of bullion into the state, imports discouraged
to keep to a minimum the flow of bullion out of the state. But commerce was not the only means by
which money could be accumulated. It could also be accumulated through plunder (that is seizing by
force property belonging to other nations). Significantly, no moral distinction was drawn between the
two. Mercantilists held that both exchange and plunder were legitimate methods of amassing wealth. The
only issue for mercantilists was the relative effectiveness of one method vis-a-vis another. Sir Josiah
Child, seventeenth century merchant and economist, once said that ‗all trade is a kind of warfare‗.
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Finally, classical mercantilists held that state regulation of economic activity is necessary and normal.
That they should believe so is not surprising. The extension of the sovereign‗s power over the economic
life of his subjects was one of the hallmarks of the transition from feudalism to modernity. The
crisscrossing and overlapping jurisdictions of the feudal period were gradually replaced by the single
jurisdiction of a sovereign power. In practice, this meant that, certainly by the late sixteenth century,
sovereigns almost everywhere in Europe claimed the exclusive right, within their territory, to raise taxes,
impose duties, grant franchises, protect property rights and so on. Religious authorities – clerics, bishops,
the Papacy – and local lords and barons were increasingly cut out of the equation. The regulation of
economic activity is thus inextricably linked with the rise of the modern state. It should also be noted that
these newly acquired sovereign prerogatives were not seen as ‗interference‗ in the ‗natural‗ working of
the economy. Rather, they were immutable facts of life to be neither celebrated nor regretted.
Classical mercantilists, therefore, rejected the separation of economics and politics that underpins
classical liberalism. They also reject the idea of a pre-existing harmony of interest between individuals or
between nations. The economic realm, in their view, is indistinguishable from the political realm, and it is
a realm of un-relenting struggle. Hence, Jacob Viner‗s characterisation of mercantilism as the pursuit of
both power and plenty. Power was seen as a means to plenty; plenty was seen as a means to power. Both
were entirely legitimate means and ends of policy.
The emphasis on wealth as critical component of national power, the insistence on maintaining a positive
balance of trade, and the conviction that some types of economic activity are more valuable than others
leads mercantilists to argue that the state should play a large role in determining how society's resources
are allocated. Economic activity is too important to allow decisions about resource allocation to be made
through an uncoordinated process such as the market. Uncoordinated decisions can result in an
―inappropriate‖ economic structure. Industries and technologies that may be desirable from the
perspective of national power might be neglected, while industries that do littlie to strengthen the nation
in the international state system may flourish. In addition, the country could develop an unfavorable
balance of trade and become dependent upon foreign countries for critical technologies. The only way to
ensure that society‗s resources are appropriately used is to have the state play a large role in the economy.
Economic policy can be used to channel resources those economic activities that promote and protect the
national interest and away from those that fail to do so.
During this period countries pursued a variety of policies intended to expand production and wealth at
home while denying similar capabilities to others. Six policies were of nearly universal importance. First,
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countries sought to prevent gold and silver, common mercantilist measures of wealth, from being
exported. At the beginning of the sixteenth century, Spain declared the export of gold or silver punishable
by death. Similarly, France declared the export of coined gold and silver illegal in 1506, 1540, 1548, and
1574, thereby demonstrating the difficulties of enforcing such laws. Second, regulations (typically, high
tariffs) were adopted to limit imports to necessary raw materials. Importing raw materials was desirable
because it lowered prices at home and thereby reduced costs for manufacturers. By limiting imports of
manufactured and luxury items, on the other hand, countries sought to stimulate production at home while
reducing it abroad.
Third, exports of manufactured goods were encouraged for similar reasons. Fourth, just as they sought
to encourage imports of raw materials, countries aimed to limit the export of these goods so as to both
lower prices at home and limit the ability of others to develop a manufacturing capability of their own.
Fifth, exports of technology—including both machinery and skilled artisans—were restricted in order to
inhibit potential foreign competitors. Finally, many countries adopted navigation laws mandating that a
certain percentage of their foreign trade had to be carried in native ships. This last trade regulation was
intended to stimulate the domestic shipping and shipbuilding industries—both of which were necessary
resources for successful war making.
By the early nineteenth century, mercantilist trade restrictions were coming under widespread attack,
particularly in Great Britain. Drawing on the Liberal writings of Adam Smith and David Ricardo,
Richard Cobden and other Manchester industrialists led the fight for free trade, which culminated in
1846 in the abolition of the ―Corn Laws‖ (restrictions on grain imports), the last major mercantilist
impediment to free trade in Britain. Other countries soon followed example. Indeed, under Britain‗s
leadership, Europe entered a period of free trade that lasted from 1860 to 1879. However, this trend
toward freer trade was reversed in the last quarter of the nineteenth century. The purported causes of this
reversal are many, including the decline of British hegemony, the onset of the first Great Depression (of
1873–1896), and the new wave of industrialization on the Continent, which led to protection for domestic
manufacturers from British competition. For whatever reason—and the debate continues even today—by
1890, nearly all the major industrialized countries except Great Britain had once again imposed
substantial restrictions on imports.
2.1.2 Economic Nationalism
Economic nationalism is the form that mercantilism has taken in an age of popular sovereignty and mass
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democracy – in an age, that is, in which government is conducted, at least in theory, in the interests of the
people. The doctrine began to emerge in the early nineteenth century, partly as a product of the growth of
political nationalism – the belief that nations exist objectively and have a right to self-determination –
unleashed by the French Revolution; and partly as a reaction to the rise to prominence of economic
liberalism (especially after economic liberalism became the ideology of the strongest economic power –
Britain – in the mid-nineteenth century). Since then, economic nationalism has taken a number of
different forms. One could contrast, for example, the aggressive economic nationalism of Johan Fichte in
the early nineteenth century – the core ideas of which were later applied by Dr Schacht, Hitler‗s finance
minister, in his attempt to build a ‗new economic order‗ based on German supremacy in Europe – with
the more defensive economic nationalism of modern day writers such as Robert Gilpin. For Fichte, the
economic stance of the nation was dictated by the political environment in which it operated. In a hostile
environment of competing states, an aspiring nation, such as Germany in the nineteenth century, had no
choice but to pursue an uncompromising economic foreign policy. Nationhood could not be acquired on
the cheap, without injury to other nations. Its achievement and maintenance required unshakeable will and
determination. Gilpin, on the other hand, advocates ‗benign mercantilism‗. The essence of this doctrine is
that states regularly have to protect their economies from foreign competition in order to maintain high
levels of employment, and general economic and social stability. The point of such measures is not to
injure other parties, but to defend oneself. Modern democratic states in particular, he says, have no choice
but to protect their citizens from the sometimes cruel vicissitudes of the international marketplace.
Despite these wide differences, however, all economic nationalists contend that state intervention is
needed to secure three goals: national identity and solidarity; national welfare; and national security.
The emphasis that economic nationalists have put on these goals is clearly revealed in the way that they
have responded to the theory and practice of economic liberalism. Firstly, they have been skeptical of the
notion that left to itself the market will, in the long run, reach a state of ‗equilibrium‗ in which supply and
demand of all goods and services in the marketplace are perfectly balanced. In their view, this notion is
not so much theoretically invalid as socially and politically unrealistic. How long will it take before the
market reaches equilibrium?
Five years? Ten years? Twenty? As Keynes once sardonically said, ‗In the long run we‗re all dead‗.
Governments cannot, in the opinion of economic nationalists, wait until markets achieve equilibrium.
They must intervene. One reason for this is that the twentieth-century state, as a result of the rise of
popular sovereignty and mass democracy, has increasingly assumed responsibility for the social and
economic, as well as the physical, security of its citizens. Once this is done the state has no choice, Gilpin
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asserts, but to seek to cushion its citizens from the adverse effects of an interdependent international
economy. If they do nothing, their popularity and ultimately their legitimacy will be undermined.
Secondly, economic nationalists have been skeptical of both the feasibility and desirability of free trade.
E.H. Carr described free trade as ‗an imaginary condition that has never existed‗. This contrasts sharply
with the fact of the sovereign state, and the fact of a plurality of states existing in an anarchical
international system; that is, a system which lacks a central government. In such a system, states have to
look after themselves. They cannot expect anyone else to do it for them.
As a consequence, they are far more concerned with their own wealth, or their wealth vis-a-vis major
rivals, than with the wealth of the world as a whole. For nationalists it is relative wealth and relative
power that counts. Hence their contempt for the ‗cosmopolitan‗ or ‗utopian‗ liberal who looks at the
international economy in terms not of national but of global welfare, and in doing so wishes away the
nation-state. But the nation-state cannot be wished away, say nationalists, because it is the focal point of
peoples‗ loyalties, and the central repository of power in the international system.
Carr also described free trade as the doctrine of the economic top dog. Free trade, he asserted, was not a
universal interest (as Britain, France, the US and their official and unofficial ‗utopian‗ spokesmen
claimed
during the inter-war period), but merely the particular interest of the strongest trading nations. This was
because they were the ones who, because of their superior economic strength and efficiency, stood to
benefit most from the existence of a free trading order. This line of attack has deep roots in economic
nationalist thought, and can be traced back to the writings of Alexander Hamilton, and especially to those
of Friedrich List.
Thirdly, economic nationalists contend that liberals underestimate the degree of interference in economic
affairs required to preserve national security. Economic liberals, of course, do not ignore the question of
national security. Smith declared that ‗defence is more important than opulence‗. He also threw his
weight behind the navigation acts, a series of acts of parliament of the eighteenth century designed to
protect the British shipbuilding industry and thus preserve Britain‗s maritime supremacy. Similarly,
Cobden, though a non-interventionist, was certainly no pacifist. He was a firm supporter, for example, of
the ‗two-power standard‗ (the idea, central to British foreign policy in the nineteenth century, that the
Royal Navy should be at least as strong as the navies of the next two strongest powers combined).
However, economic nationalists have gone much further in their estimations of what an effective defense
involves. They have naturally called for the protection of armaments industries. They have also called for
the protection of the shipbuilding and iron and steel industries, coal mining, agriculture, high-technology
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industries, and even textile manufacture (to maintain morale, for instance, during a blockade). Obviously,
the criteria for determining a strategically important good have changed pari passu with changes in the
character of war (from small-scale conflicts between mercenaries to large-scale conflicts involving whole
nations). Coal, for example, is not strategically important nowadays, but it was vital a hundred years ago.
Oil was of minor importance a hundred years ago, today it is vital. The important point is that all
economic nationalists define ‗strategic importance‗ much more inclusively than liberals. Indeed this has
often led to calls for a strategy of autarky.
Finally, some economic nationalists have opposed what might be called ‗cosmopolitan liberalism‗ in
principle; that is, not merely because leaving things to the market, they believe, will have certain
undesirable practical consequences (for example the collapse of certain industries). This is because they
feel that uncontrolled commerce can lead to the culture of the state being undermined and its national
identity eroded. Romantic nationalists such as Fichte saw the nation as being prior to and constitutive of
the individual. The nation, like the family, constituted an organic whole: it was a good in itself. It should
therefore free itself from foreign influence as much as possible. He advocated national planning and the
progressive reduction of foreign trade. Essential goods and raw materials previously acquired through
trade would be provided for by the gradual expansion of the nation to its ‗natural frontiers‗.
Friedrich List
Few economic nationalists went as far as Fichte. List, author of The National System of Political
Economy (1840), the most important economic nationalist text of the nineteenth century, put forward a
strategy of ‗selective self-reliance‗. He argued that the pressure on developing countries to enter into an
international economy dominated and shaped by the most developed countries was great. Such pressure,
however, should be resisted, because integration would lead to dependence. Free trade, claimed List, was
simply a device by which industrially advanced countries – Britain – maintained hegemony over newly
industrialising countries – Germany. Latecomers, like Germany, should therefore pursue a policy of
stateled national development involving protection, investment in infra-structure, the creation of a
national system of education, and the formation of ‗customs unions‗ with states at a similar stage of
development. For List, in contrast to Cobden, the power of producing wealth was infinitely more
important than the wealth itself. Not surprisingly, therefore, he felt that the most important economic task
of the state was to protect ‗infant industries‗. Only by ensuring that these young industries got off the
ground could the future productive power of the nation be ensured.
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It is important to note, however, that List advocated selective, not indiscriminate, protection. The state
should not be gulled into protecting any industry at any price. On the contrary, it should protect only
those industries earmarked for such privileged treatment according to a previously drawn-up national
strategic plan.
It is also important to note that List did not reject economic liberalism in its entirety. In sharp contrast to
Fichte, he felt that international trade was in the main a beneficial activity. But it was one from which
weaker states sometimes had to abstain selectively in order to maintain their independence. Once an
industry had reached an appropriate level of development, however, it should, indeed must, enter the
international marketplace. This was the only way of ensuring that a country‗s industries did not become
‗artificial‗ and that they kept pace with ‗international standards‗.
This partial acceptance of the benefits of market economics is evident in List‗s proposals for a German
Zollverein, or customs union. He opposed the complicated system of tariff and custom duties that the
various German states of the time maintained against each other. He proposed that they unify their tariffs
and import levies into a single system. Members of the Zollverein would by such means protect
themselves from foreign competition, especially from Britain. But competition would freely take place
within the Zollverein. He thus sought to promote wealth through selective protection but within a
competitive market system. This still constitutes the model of regional economic integration that informs
such associations as the EU, the North American Free Trade Agreement (NAFTA), and the Economic
Community of West African States (ECOWAS).
From an examination of Friedrich List‗s thought it can be seen that certain forms of economic nationalism
are not necessarily incompatible with free trade. The nationalist can quite happily advocate free trade if he
thinks it is consistent with the national interest of his country. By the same token, the supposed economic
liberal sometimes uses the language of free trade as a cloak to conceal the pursuit of narrow national
interest. If one looks closely at Cobden‗s writings, for example, one sees that one of his main concerns
was to keep Britain ‗in the front rank of nations‗ and to ensure her ‗industrial predominance‗. This is
revealing, since it shows that even a true believer like Cobden – a man who elevated free trade into a kind
of religion – championed free trade at least in part because it was a particular British interest. The
disguise was all the more convincing for the unselfconscious way in which it was worn.
Economic Nationalism and the Post-war International Economic Order
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The legacy of these ideas in the contemporary world is greater than sometimes imagined. The post-war
international economic order, though almost invariably characterised as ‗liberal‗, is in reality founded on
a compromise between economic liberalism and economic nationalism. The idea was to combine the
maximum degree of openness internationally (by progressively reducing barriers to trade, ending trade
discrimination, establishing a multilateral payments system and so on) with a large degree of domestic
autonomy (to manage ‗demand‗, maintain full employment, build a welfare state, and stabilise prices).
This compromise is strongly implicit in the (1947) GATT. Whilst committing member states to the
progressive reduction of barriers to trade, tariffs in particular, it also permits states to adopt protectionist
measures in a number of circumstances. Article XII permits protection in the event of a chronic
balanceof-payments crisis. This amounts to an implicit acknowledgement that the political commitment to
full employment should, ultimately, take priority over the economic principle of comparative advantage.
A payments crisis is a sign that an economy has become uncompetitive. Such an eventuality usually
requires strong medicine to put things right.
This often involves raising interest rates, cutting public expenditure, applying wage controls, devaluing
the currency, and other methods to cut imports, boost exports and generally channel resources away from
consumption towards investment. But Article XII allows states to postpone the day when such medicine
needs to be taken – perhaps indefinitely. Protection is a relatively easy option for a government faced with
a balance-of-payments crisis: one could say that it enables it to solve a short-term political problem –
caused, say, by rising unemployment – by leaving the economic problem for some other government to
deal with in the future. Article XVIII allows protection for infant industries for purposes of national
economic development.
Article XIX allows protection in the wake of unforeseen or ‗serious injury‗ to domestic producers. Article
XXI allows states to take protective measures for reasons of national security. And, perhaps most
crucially, Article XXIV permits preferential trade (not permitted in any of the other articles) if the object
is to create a customs union or free-trade area.
These articles demonstrate that, from the outset, the post-war liberal economic order made a number of
substantial concessions to economic nationalism. Article XXIV alone suggests that the GATT agreement
owes almost as much to List as it does to Cobden and Smith.
It should be stressed that universal free trade is not a stated aim of GATT. On the contrary, GATT
implicitly concedes the right of states to protect their own markets. Its objects are the eradication of
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discriminatory treatment in international commerce, and ‗substantial reductions‗ in, not elimination of,
barriers to trade.
Economic Nationalism and War
The conventional wisdom has it that whereas economic liberalism leads to peace, economic nationalism
leads to war. Protectionism, it is widely held, leads to retaliation, this leads to the growth of mutual
animosity and distrust, which in turn leads to the greater likelihood of conflict and war. This wisdom can
be challenged on a number of grounds.
Firstly, one has to take into account modern conditions. All the main industrial countries of today have so
much to lose from war that war between them seems highly improbable. The costs, and therefore the
improbability, of war are raised further when one bears in mind that a war between today‗s industrial
powers would be one conducted with incredibly destructive weapons. The fact that a war between major
industrial powers has not been fought for over 50 years, despite many differences and disagreements
between them, provides at least partial evidence of an acute awareness of the risks and costs involved.
Secondly, the contention that increased protection leads to decreased trade and therefore an increase in
economic instability and political tension can be refuted. Susan Strange has argued that the importance of
the relationship between protectionism and trade is frequently overstated. GATT is often lauded for
bringing about the vast increase in international trade that has occurred since 1945, and in so doing, for
contributing to the generally peaceful relations that have prevailed between the world‗s major powers.
But according to Strange, the availability of finance and credit accounts for the growth in post-war world
trade, not the progressive reduction of trade barriers through GATT. As a consequence, GATT should not
be praised for contributing to peace; nor should the name of protection be further besmirched. In
Strange‗s view, price has not been the crucial factor in determining patterns of trade in the post-war
period, but design, quality and performance. In other words, the goods that have sold best in world
markets have not necessarily been the cheapest ones but those demanded by an increasingly sophisticated
and discerning consumer. As a result, manipulating the marginal price of a good through the imposition
of a tariff or restricting its supply through the imposition of a quota has not had the long-term effect on
trade that many have supposed. In addition, the changing structure of international production has enabled
firms to circumvent tariffs and other restrictive measures in a range of subtle ways. The growth of
intrafirm trade (i.e. trade in goods and services between different branches of the same, conglomeratic,
firm)
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and international production for the world market, for example, has enabled firms to circumvent
protectionist measures by locating the manufacturing process in a variety of countries, the final product
emanating from the one most conducive to maximising sales and profits.
Thirdly, much depends on whether protectionist measures are offensive or defensive in nature and in
intent. The vast majority of measures taken since the early 1980s have been of the latter, defensive, kind.
Their object has been to defend jobs rather than purposefully to injure another country‗s economy. The
transparency of many of the measures nowadays imposed to restrict imports is evidence of this fact. So,
too, is the fact that many such restrictions, such as OMAs and VERs, are negotiated between the parties in
advance.
Cordell Hull‗s famous statement that ‗when goods can‗t cross borders, soldiers will‗ is thus at best a
halftruth. The pursuit of economic nationalist policies may turn a healthy competitive relationship into an
unhealthy adversarial one. But there are many other factors involved, not least the type of economic
nationalist policies being pursued. The contention, therefore, that increased protection inevitably leads to
decreased trade and an increase in the likelihood of conflict and war is one that needs to be treated with a
fair amount of caution.
The Nature of the Terms
Having mentioned the good reputation of economic liberalism and the rather dark reputation of
mercantilism and economic nationalism, a few words of caution should be uttered, by way of conclusion,
on the nature of these words. ‗Mercantilism‗ and ‗economic nationalism‗ are not ‗value-neutral‗ terms.
They are to some extent ‗loaded‗, that is they carry with them certain inferences or implications of a
morally laudable or disreputable kind. ‗Mercantilism‗ was not a term used by mercantilists themselves.
Rather, it was a term selected for its negative connotations by later economic liberals in order to
characterise a period of thought and practice of which they strongly disapproved. It is thus a pejorative
word: a ‗boo‗ word, to employ George Orwell‗s terminology, not a ‗hooray‗ word.
Economic nationalism is a ‗boo‗ word too. It was popularised by liberal internationalists in the inter-war
period in order to condemn, through association with the ‗nationalism‗ that had caused the Great War, the
restrictive and ‗beggar-thy-neighbour‗ economic policies adopted by many states in the 1930s that they
thought, not entirely errantly, would lead the world into another war. Nowadays, though many statesmen
act in economically nationalistic ways, they rarely say that they are doing so, and never describe
themselves as ‗economic nationalists‗. This is because liberals have been so successful in associating
‗nationalism‗ with many of the most terrible ills of the twentieth century. It is also because these
statesmen tend to see themselves as good, honest liberals when it comes to trade. It is the others, the
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foreigners, who are the selfish nationalists. Resort to protectionism is portrayed as a regrettable step, but a
necessary one given the antisocial and selfish behaviour of others. Such measures are seen as short-term,
to be abandoned as soon as such anti-social behaviour is terminated and any necessary economic
adjustments made. Few statesmen see their policies as comprising a blend of economic nationalism and
economic liberalism, despite the fact that protectionism and ‗neo-protectionism‗ are without doubt
enduring features of the international economic landscape, even in a supposedly ‗rapidly globalising‗
world.
2.2 Economic Liberalism
The first point to note about economic liberalism is that it is an exceedingly broad doctrine – broader than
economic nationalism and even Marxism. Adam Smith, David Ricardo, J.S. Mill, J.A. Hobson, J.M.
Keynes, David Mitrany, Friedrich Hayek, J.K. Galbraith, Milton Friedman, Robert Keohane – all of these
influential political economists are considered to be liberals.
They are a motley bunch. Smith, Ricardo, Hayek and Friedman, strongly advocate laissez-faire, free trade
and minimal state intervention in the ‗natural‗ working of the economy. By contrast, Hobson, Keynes,
Galbraith and Keohane advocate quite extensive state intervention in the economy both domestically and
internationally.
Some thinkers, indeed, have been advocates of both laissez-faire and state intervention. In the early years
of their respective careers, Hobson and Keynes, for example, were both staunch supporters of laissezfaire
and free trade. However, first Hobson (in the 1910s) and then Keynes (in the 1920s) abandoned their
earlier beliefs and became proponents of a ‗new‗, interventionist, form of liberalism. This transformation
in their thought was based on a growing awareness that certain profound changes were taking place in the
world economy.
First, the invention of the assembly line had revolutionised production. Goods could now be rapidly
manufactured in vast quantities for the mass market. This innovation also enabled firms to maximize
‗economies of scale‗ and dramatically increase productivity. The law of economies of scale holds that, up
to a point, the larger the scale of production the lower the cost of each unit produced (that is the lower the
‗marginal cost‗ of production). Later somewhat tendentiously called ‗Fordism‗, after the great American
automobile manufacturer, this revolutionary development involved breaking down the manufacture of
complicated modern machinery into a series of highly specialised and repetitive tasks. Each worker would
concentrate on the performance of one of these minute tasks. His level of skill, and consequently degree
of training, only needed to be small. Only a tiny proportion of workers required knowledge of the
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production process as a whole or the engineering principles at work. Unit cost could, as a result, be
dramatically cut. Previously expensive goods could be mass-produced for the newly emerging mass
market.
This new technique of production, which soon became the method of manufacture of all goods except the
most specialised and luxurious, was highly capital-intensive. Although it increased labour productivity
(output per worker), it also led to the redundancy of large sections of the labour force (at least in the short
run). In addition, capital-intensive techniques of production led to wealth being concentrated in fewer and
fewer hands. As well as raising certain ethical questions about justice and democracy, such a development
had far-reaching implications for economic stability. As income inequality increases, so does the ratio of
aggregate savings to consumption, due to the higher propensity to save of higher income groups. But if
consumption does not keep pace with output, what happens to the goods being turned out of the factories
in ever larger quantities? The answer, according to Hobson and Keynes, was some kind of economic
crisis. For Hobson this manifested itself in imperialism, as industrialists and financiers were forced
increasingly to look overseas for new markets and fields of profitable investment. For Keynes, it
manifested itself in increasing market disequilibria and a need to rethink the fundamentals of domestic
and international economic policy.
Second, monopolies and cartels were becoming increasingly salient features of the world economic
landscape. Collaboration between firms to divide up markets was increasingly replacing free competition
between firms within the market.
Third, the scale and sophistication of advertising had grown to new, previously unimagined, heights.
Corporate executives, especially in America, were quick to spot the commercial potential of new mass
media, such as the radio and television. Through such media, information about products could be
instantaneously communicated to an ever larger, and largely captive, audience of consumers. Sales
techniques could be refined utilising the latest findings from new fields of scientific enquiry, such as
behavioural psychology. The new economy had the means not only to satisfy demand, but artificially to
create and sustain it.
Fourth, Hobson and Keynes were alarmed by the increasing ability of foreign firms to gain a decisive
competitive advantage in world markets by ‗sweating‗ (that is exploiting) their non-unionised
labourforce. The relative degree of protection afforded by the state to workers within its jurisdiction, and
the relative strength of the trade union movement from one country to another, was becoming an
increasingly important factor in national competitiveness. By suppressing trade unions and rejecting
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workers‗ demands for employment rights and regulation of the workplace, some countries were able to
force down the price of labour. This enabled their firms to steal a competitive advantage over rivals
operating in more humane, socially progressive countries.
A fifth development was the tremendous success of certain countries in building up immense industrial
strength behind high protective walls. This was contrary to the teachings of classical economics, which
held that the short-term benefits of interference in the ‗natural‗ workings of the economy were always
bought at a high long-term price. The nineteenth-century experience of Germany and the US suggested
otherwise.
Finally, in an era of mass democracy, governments were increasingly obliged to respond to the ebb and
flow in the economic fortunes of their countrymen, particularly as they affected the level of employment.
It is an important but widely unappreciated fact that until the extension of the franchise in the nineteenth
and early twentieth centuries, unemployment had not been a significant political issue. Within the space
of a generation it became one of the most important issues on the political agenda.
These six developments suggested to Hobson and Keynes, among others, that the classical economic
model of ‗perfect competition‗ between relatively small producers had become obsolete. Economic
activity was now characterised by ‗oligopolistic competition‗, meaning competition, and often
collaboration, between a diminishing number of large-scale producers (whose operations, incidentally,
were increasingly international in scope). The implication of this was that the state would have to assume
greater responsibility in the economic realm if the well-being of the consumer, the worker and the
smallscale producer were to be protected, and the welfare goals of society as a whole achieved. The
market, as a method of allocating resources in society, was far from dead. But it could no longer be
allowed to operate in the unfettered way advocated by the classical political economists.
Core Characteristics
Given the variety of liberal thought, the question arises, what are its distinguishing characteristics? Three
broad features can be identified. Firstly, faith in the market as the most efficient means of allocating
resources, or at least a relatively efficient means of allocating resources, provided that the state
successfully performs its role of establishing the conditions – preventing, for example, the growth of
monopolies – upon which the successful operation of the market depend. Secondly, individualism: the
belief that the individual is the basic unit of society and that the acid test of any set of institutions is the
degree to which they promote individual liberty and welfare (as opposed to the welfare of a clan, class,
business elite, ethnic or some other group). Thirdly, scepticism towards state, or central, control of
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economic activity. Some liberals, ‗new‗, ‗left‗ or ‗welfare‗ liberals, contend that management and
regulation of economic activity is increasingly needed in modern industrial conditions. But all liberals
believe that direct central control of economic activity is only justified in the most extreme circumstances
– during war, for example, or in the face of acute market failure – and then only temporarily.
But one has to be careful even with this very broad way of looking at things. Mitrany, for instance, is
generally regarded as a liberal theorist of international relations, but his ‗working peace system‗ contains
very little scope for the operation of market forces. He shared the Marxist view that freedom of choice in
a capitalist society meant freedom to exploit. He distrusted the market, believing it to be an increasingly
unstable and inequitable method of economic exchange. In its place Mitrany put science. He believed, in
particular, that the production and distribution of goods and services should be based on rational,
scientifically identifiable, ‗human needs‗. Only by this revolutionary method could the instability and
inequity which had become an endemic feature of modern industrial society be avoided. In some of
Hobson‗s writings a similar distrust of the market and faith in ‗rational‗ economic planning can be
observed. Indeed, he extended this faith to the world as a whole in his plans for international economic
government.
It is important to note, however, that these two thinkers were not statists: they did not view state
intervention in and organisation of economic activity as some kind of panacea. They certainly believed in
regulating economic activity, and planning in such areas as investment and production. But they did not
think that the state should be the only organ performing these tasks. On the contrary, they envisaged an
extensive role for specialised agencies, public corporations, cooperatives, guilds and other non-state
entities. These bodies would be staffed by technical experts. Like many of their generation, Mitrany and
Hobson shared the Fabian faith in the ability of the specially trained technical expert to solve a range of
technological, economic, social, even political, problems.
It is because of their distrust of the market and their belief in certain forms of economic planning that
certain writers have declined to regard them as bona fide members of the liberal tradition. It is largely a
matter of where one draws the line between liberalism and reformist socialism, a line much blurred by the
revitalisation (some would say degradation) of liberal doctrine in the early part of the twentieth century by
such men as Hobson, Mitrany and, in particular, Keynes. The general view, however, is that they should
be considered as liberals because of their faith in meliorism and the possibility of reform without
revolution, because of their belief in ‗pluralism‗ – that is in multi-association governance of human
society – and because their ultimate unit of analysis was the individual. For them, as with other writers in
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the liberal tradition, it was individual welfare that mattered, and any value that the various groups and
associations they recommended possessed was a by-product of their success in delivering individual
human welfare.
2.2.1 Classical Liberalism
The roots of most liberal ideas can be found in classical liberalism, which emerged with the writings of
Adam Smith in the late eighteenth century. It is important to understand this doctrine if we are to
understand later liberal theories.
Classical liberals share six core beliefs. First, they claim there are laws of human behaviour comparable to
natural laws. Just as there are objectively existing physical laws, for example the law of gravity, there are
objectively existing social laws, for example the laws of supply and demand. These laws are objective
because they are not products of thought or consciousness, they are not ‗socially reproduced‗ attitudes,
values or norms. Rather they exist external to ourselves, even though ‗irrational‗ governments may
sometimes choose to suppress them (as they did during the ‗mercantilist‗ period). The word ‗irrational‗ is
important. According to classical liberals, these laws not only exist but can be discovered through reason.
Governments and societies that made no attempt to discover them, or who ignored them, were thus acting
irrationally. To illustrate: just as it would be irrational to ignore the laws of physics when building a
bridge, it would be irrational, classical liberals claim, to ignore the laws of economics when seeking to
create wealth. If the laws of physics are ignored when building a bridge, the bridge will collapse. If the
laws of economics are ignored when seeking to acquire wealth, the result will be poverty. It is because
classical liberals believe in the existence of such laws that classical liberalism has been called a ‗theory of
social physics‗.
Secondly, classical liberals claim that wealth consists of production, and especially industrial production.
This contrasts with the mercantilist view, which maintained that wealth resided in precious metals. The
significance of this disagreement is considerable. Whereas for mercantilists wealth was finite, for
classical liberals it is infinite, at least in principle. The world enjoys only a finite supply of precious
metals, whereas the only limit to the number of goods and services that can be produced is human
imagination and ingenuity. The social and political implications of this belief are profound. For
mercantilists, economics is a struggle for wealth, a ‗zero-sum game‗. For classical liberals, economics is
a competitive activity the outcome of which is wealth for all, a ‗positive-sum game‗.
A third belief of classical liberalism is that self-interest is central to the operation of these economic laws.
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Smith felt that in itself selfinterest was not a good thing. Indeed, in his famous work, The Wealth of
Nations, there are a number of references to the ‗mean rapacity‗ of the rising commercial class and, by
virtue of this, their ‗unfitness‗ for government. However, though not a good thing in itself, the pursuit of
self-interest has social value: the unbridled pursuit of economic self-interest, by consumers and producers,
leads, through the operation of the ‗hidden hand‗, to the most efficient possible allocation of resources in
society as a whole. In a typically acute and droll passage Smith described his idea thus: ‗It is not from the
benevolence of the butcher, the brewer, or the baker that we expect our dinner but from their regard to
self-interest. We address ourselves, not to their humanity, but to their self-love, and never talk to them of
our necessities, but of their advantages.‗
Fourthly, classical liberals also emphasise the importance of specialisation through a division of labour.
This can operate both nationally and internationally. Individuals should produce the things that they are
best at producing and exchange them in the marketplace. Production and consumption are thereby
increased. Similarly, nations should concentrate on producing those things they are best endowed to
produce, and exchange them in the international marketplace.
It was in light of this that David Ricardo developed his notion of ‗comparative advantage‗, which he
famously illustrated with his tale of Portuguese wine and English cloth. Though Portugal was more
efficient at producing both of these commodities, Ricardo argued that it would be better from the point of
view of the welfare of both Portugal and England, and indeed the welfare of the world as a whole, if
Portugal concentrated on the production of wine, and England on the production of cloth. Though
Portugal had an absolute advantage in the production of both commodities, England had a comparative
advantage in the production of cloth. The reason for this was simple. Though its climate inhibited
England from ever becoming an efficient producer of wine, the skills, ingenuity, and industriousness of its
workforce suggested that it could become an efficient producer of cloth: if not as efficient – at least for
the time being – as Portugal. Basing production on comparative, as opposed to absolute, advantage would
lead to the maximisation of aggregate production.
Fifthly, classical liberals maintain that maximum efficiency is not the only benefit of laissez-faire and free
trade. Two further benefits are maximum liberty and peace. Liberty is achieved because individuals are
perfectly free to pursue their interests as they define them: not for nothing did Adam Smith call the
market economy ‗the system of perfect liberty‗. Peace is achieved because the ‗harmony of interests‗
immanent in nature is allowed to manifest itself unimpeded by state meddling.
Finally, classical liberals advocate the minimal or ‗nightwatchman‗ state. In the eighteenth and nineteenth
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centuries, the state was seen by many liberals as synonymous with ‗privilege‗, with the landed
aristocracy, with corruption, and with mercantilism. As the intellectual spokesmen of the rising
commercial class, Smith and Ricardo, among others, wanted to reduce the role of the state to an absolute
minimum. It is not the case, however, that they argued for no state at all. There were certain functions,
essential to the operation of the market, that only the state could perform, for example the provision of
law and order, defence, the protection of ‗inalienable‗ property rights, and the maintenance of the value
of the currency.
The International Man‟: Richard Cobden
The chief exponent of the classical liberal doctrine that free trade leads to peace is Richard Cobden.
Indeed, he is often credited with being the first person to politicise Smith‗s doctrine, in that he devoted
much of his life to describing and propagating the political virtues that flowed from laissez-faire and free
trade. A member of parliament for Stockport (and later Camden Town), and leader with John Bright of
the ‗Manchester Capitalists‗ and the Anti-Corn Law League, Cobden argued that the most important
prerequisite of international peace was unfettered commerce between nations.
He advanced two arguments. Firstly, like Smith and Ricardo before him, he argued that commerce made
societies mutually dependent on one another. Commerce bound nations together in a common endeavour
– the common endeavour of maximising trade and wealth. Peace would result, since all states benefited
from a system of free commerce. No state had an interest in breaking these beneficial ties by going to
war. Cobden felt that free trade was nothing short of a divine law: ‗One country has cotton, another wine,
another coal, which is proof that, according to the Divine Order of things, men should fraternise and
exchange their goods and thus further Peace and Goodwill on Earth‗. Cobden also described free trade, in
characteristically grandiloquent terms, as ‗God‗s diplomacy‗ and ‗the grand panacea‗. It brought in its
wake not only peace but prosperity, liberty, moral improvement and civilisation.
But free trade brought peace in another way. At the heart of Cobden‗s theory is what Kenneth Waltz has
labelled a ‗second image‗ analysis of international relations: the idea that war is a product of the domestic
structure or constitution of the state. Cobden believed that conflict and war was a conspiracy of the
aristocratic ruling class. This class, in Cobden‗s view, had an interest in monopoly, protectionism,
colonialism, the balance of power and foreign intervention. And these things led to international jealousy,
hostility, and, ultimately, to war – from which no one benefited except the ruling classes.
The highly restrictive corn laws were the outstanding symbol of the old order. This high tariff on
imported corn not only created hostility and retaliation from corn exporting countries, but also raised the
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costs of domestic industry; created a shortage of sterling abroad, thereby hindering British exporters;
lined the pockets of the ruling elite, thereby consolidating their power; and enabled the ruling elite to
continue their military, colonial and diplomatic adventures which, since they did not pay, landed the
country deeper and deeper into debt. In addition, involvement in war enabled the ruling class to justify
increases in taxation, which further eroded the capital available for investment in, and the production of,
socially more useful commodities.
Cobden argued that free trade would undermine the political dominance of the old order. Restrictions on
commerce would be eradicated, and interference, meddling and coercion by the state would be superseded
by the principle ‗as little intercourse as possible betwixt governments, as much connection as possible
between the nations of the world‗.
The Impact of Economic Liberalism
The impact of economic liberalism has been very considerable, if not in the pure form advocated by
Cobden. Firstly, free trade became one of the central goals of British foreign policy between 1846 and
1880. During this time, Britain had far more influence than any other power on the shape of the
international economic order. Other countries, advanced and backward, were encouraged and cajoled to
open their markets. The gold standard ensured international economic stability, if sometimes at a high
domestic social price. The world went from economic strength to strength under the ‗benign financial
autocracy‗ of the City of London.
Secondly, from the 1880s onwards there was a general drift towards protectionism, especially with
respect to colonial possessions. Free trade was suspended during the First World War. Economic controls
were introduced by all the major combatants, as was planning for the production of vital war materials.
The status of laissez-faire and free trade as the normal method of economic organisation was not,
however, seriously challenged. The third of President Wilson‗s ‗Fourteen Points‗ called for the removal,
as far as possible, of economic barriers between nations. But despite widespread intellectual adherence to
these principles, most countries, due to the devastation they had suffered during the war, and the political
need to give employment a high priority, found it difficult to implement them in practice. It should also
be noted that the notorious reparations clauses of the Treaty of Versailles were in direct contradiction to
the principle of free trade: a throw-back, indeed, to the dark days of mercantilism. In addition, the new
system had from the outset one notable defector. Bolshevik Russia denounced all treaties, including
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commercial ones, as instruments of capitalism, and condemned free trade as the doctrine of the bourgeois
imperialist powers.
Thirdly, economic liberalism formed an essential part of the diplomacy of US Secretary of State Cordell
Hull in the 1940s, and the international economic order created after the Second World
War was founded on its principles: openness; non-discrimination; multilateralism; and convertibility of
currencies. More than anyone involved in the negotiations at Dumbarton Oaks, San Francisco, Bretton
Woods and Havana, Hull held faith with the classical liberal vision. This was in sharp contrast to Keynes,
the chief British negotiator, who advocated inter alia state trading in commodities, international cartels
for ‗necessary‗ manufactures, and quantitative import restrictions for non-essential manufactures.
What John Gerrard Ruggie has termed the ‗compromise of embedded liberalism‗ has been the
cornerstone
of the international economic order since 1945. Notwithstanding the intellectual victories of the New
Right of the 1980s, and the subsequent deregulation of many aspects of economic life – especially
financial markets – around the world, the multilateral management of the international marketplace,
through a wide variety of international institutions and agreements, is still the dominant norm of the
system. There is room for argument about the precise ratio of ‗state‗ to ‗market‗ in the current
configuration of the international economic system, but the centrality of liberal ideas of one kind or
another cannot be denied. Indeed, with the end of the Cold War and the collapse of Soviet communism,
Francis Fukuyama proclaimed the ‗unabashed victory‗ of economic liberalism as a central part of his
thesis on the ‗End of History‗.
It is certainly true that, for the time being, economic liberalism does not have any serious ideological
rivals. But Fukuyama‗s bold thesis needs to be qualified in at least two ways. First, it should be noted that
economic liberalism comes in a wide variety of forms. The aggressively ‗individualistic capitalism‗ of
theUS (where private profit comes first, and the well-being of the nation is a by-product), can be
contrastedwith the ‗collective capitalism‗ of Japan and the newly industrialising countries of East and
South EastAsia (where the nation comes first, and private profit second). This, in turn, can be contrasted
with the‗welfare capitalism‗ of the EU, characterised by a social contract between capital, labour and the
state(though one, it should be noted, that has suffered considerable erosion in recent years with the
ascendancyof free-market thinking and the gathering pace of globalisation).
Second, a distinction should be made between economic liberalism in theory and economic liberalism in
practice. While virtually all of the world‗s leading politicians extol the virtues of free trade, every
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government without exception protects its home market from foreign competition to a lesser or (usually)
greater degree. There is therefore a wide gulf between the rhetoric and the reality of economic liberalism.
The Prevalence of Protectionism
One of the main institutions of the post-war order, the General Agreement on Tariffs and Trade (GATT),
has been highly successful in bringing down tariffs on manufactured goods. Yet a wide range of non-tariff
barriers (NTBs) have grown up in their place, including voluntary export restraints (VERs), orderly
marketing agreements (OMAs), so-called ‗anti-dumping‗ and licensing laws, and onerous health and
safety regulations. Why, despite speaking the language of free trade, have states without exception
continued to employ protectionist measures? The broad answer is that they do not have the courage of
their convictions: while subscribing to the theory of free trade, believing in its general virtues, they
constantly find it difficult to implement in practice, exceptions to the general rule always seeming to get
in the way. States have thus resorted to protectionist measures of one kind or another to protect a wide
variety of industries: ‗infant‗ industries that otherwise would not otherwise get off the ground; ‗senile‗
industries that would otherwise go bust, with dire consequences for jobs; industries of strategic
importance, such as steel-making and shipbuilding; industries of cultural importance, such as film-making
and agriculture; and industries with political influence, such as French agriculture or American
automobiles. They have also resorted to protectionist measures for a host of other more general reasons,
such as to stave off balance-of-payments crises, to increase government revenue and to reduce
unemployment.
To these market distortions must be added the myriad ways in which modern governments intervene in
order to make their economies more competitive. Such measures include: strategic trade policies;
education and training policies; tax holidays; enterprise zones; export credits; subsidies; industrial
policies; and regional policies.
Rethinking Free Trade?
Given the numerous, often subtle and complex ways in which the modern state interferes with the
economic life of its citizens, some analysts have contended that the concept of free trade needs to be
reformulated. Free trade, they say, no longer has the same meaning as it did in the days of Smith, Ricardo
and Cobden.
It is now widely accepted that comparative advantage no longer depends on natural endowments but is
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policy-created. There are some obvious exceptions to this rule: mineral extraction; the growing of vines,
olives, citrus and tropical fruits; tobacco and cotton growing; various kinds of farming, and so on. But the
general point stands: the ‗commanding heights‗ of the modern industrial economy are dominated by such
products as consumer electronics, financial services and information technology. The key factor of
production in all of these industries is knowledge. In principle, the products they produce can be
manufactured or delivered anywhere in the world. The key variable is the ‗policy environment‗ – a
favourable tax regime, the availability of skilled and relatively cheap labour, political stability, support for
‗enterprise‗, capital mobility – of one location vis-a-vis another.
Given this secular change in the nature and operation of the modern economy, the traditional notion of
free trade becomes problematic. The old idea was that resources should flow to those parts of the world
where they could be most effectively utilised, free of the distortions to market forces wrought by
governments. But now governments are involved in creating the very conditions which determine whether
such resources can be used effectively or not. They are, for good or ill, an intrinsic part of the economic
landscape. This presents a huge problem for the traditional notion of free trade, predicated as it is on the
absence of the state and other public authorities from the equation. Free trade meant trade ‗free‗ of
government meddling: the free flow of resources according to ‗rational‗, that is apolitical, economic
criteria. Regardless of whether they existed in the past, the existence of such rational, apolitical, economic
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criteria can certainly be doubted today. To take one example: to what extent can the state provide
education and training before such provision becomes an unfair subsidy of domestic producers and
exporters? If knowledge is a key factor of production, the provision of education and training by the state
– in particular university education and advanced, highly specialised, technical training – becomes,
according to the old model, irrational interference in the free working of the market. There must be
something very wrong, some have contended, with a concept the application of which to current
circumstances leads to such perverse conclusions.
Cobden and Peace
If economic liberalism has played such a large role in shaping the contemporary world, why, it might be
asked, has this world been so bloody and conflictual? Why has not free trade brought peace? One answer
to this, of course, is that free trade has never been achieved. Although it is true that, at the beginning of
the twenty-first century, we have freer trade in more goods and services than we have had at any time
since the late nineteenth century, it is also true that many ‗market imperfections‗ exist, and governments
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continue to ‗interfere‗ with the operation of the market in all sorts of complex and often subtle ways:
perhaps inevitably so.
Doubt can also be cast on the validity of Cobden‗s original thesis. It can certainly be cast on its relevance
to contemporary circumstances. It now seems clear, for example, that commerce and interdependence do
not in themselves lead to peace. Indeed, greater commerce leads to greater contact and communication,
and more, not less, opportunity for tension and disagreement.Yet it is true that commerce and
interdependence can contribute to peace indirectly by enabling states to increase their prosperity. If states
are increasing their prosperity they are more likely to be stable domestically and less likely to seek
revision of the status quo internationally. Commerce also gives states access to commodities vital to their
well-being that they cannot produce themselves. They do not, therefore, have to fight in order to get them.
Yet there may be certain respects in which the effects of economic liberalism on peace are not so
favourable. The extension of economic interests worldwide in the search for markets and fields of
investment requires the extension of a certain political order. If that order is threatened by non-liberal
states, protection of such ‗global‗ economic interests may require the use of force. Force has been used
by
liberal states, for example, to protect direct foreign investments (witness the myriad interventions by the
US in the domestic affairs of Latin American countries), and to ensure access to vital raw materials
(witness US involvement in the Middle East, a result in part of Western reliance on a stable supply of oil
at stable prices). In addition, liberal societies believe in freedom to travel. Citizens of these societies are
the principal users of the world‗s airlines. They are therefore vulnerable to terrorist attacks and
hostagetaking. Force may be used to rescue victims, protect potential victims and deter such undesirable
activities.
More autarkic, mercantilist states are not so vulnerable as liberal states in these respects. They therefore,
perhaps paradoxically, have less reason to resort to arms, and not more, as Cobden maintained. This is
one of the reasons why Robert Gilpin has argued that, on balance, ‗benign mercantilism‗ may be a more
desirable approach to international economic relations than economic liberalism.
One final point should be made on this issue. There is a sense in which economic liberalism in its purer
forms depends on the conversion of all states to the liberal faith. All states have to be liberal for liberalism
to work as intended. This is one of the reasons it has been condemned as utopian.
There is a curious parallel here with that other grand, totalizing doctrine – Marxism. Lenin argued that
revolution everywhere was the condition for the success of revolution anywhere. As with liberalism, all
countries have to be Marxist for Marxism to work as intended. For this reason, Marxism too has been
condemned as utopian.
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2.3 Marx and Early Marxists
2.3.1 Classical Marxism
Karl Marx was the last great classical political economist. He was born in 1818 in Trier, a small town on
the Mosel River in western Germany. The works of Marx include The Communist Manifesto co-written
by Engels and Marx in1883, volumes 2 and 3 of Capital: A Critique of Political Economy from Marx‗s
notes and manuscripts.
What Marx wrote mostly about was capitalism. It‗s his extensive analysis of capitalism that makes Marx
highly relevant today. Marx‗s major work was a three-volume treatise on capitalism, simply titled Capital.
Marx wanted people to understand the nature of capitalism, where it came from, how it worked, what was
wrong with it, why it was a temporary phase of human history, and what one needed to do in order to
speed up its demise because reform was not feasible. Many scholars have observed that no one has
written more insightfully about these subjects than Karl Marx.
Marx‗s lifetime spanned the height of the Industrial Revolution in England. He observed and wrote about
the harsh conditions in the factory cities. He was a witness to the oppressive working conditions in the
textile and steel mills.
Karl Marx did share with Adam Smith as well as other great classical political economists, such as David
Ricardo and Thomas Malthus, the fundamental concept of the labor theory of value. Essentially they all
believed that the crucial component in determining the relative values of all exchanged commodities was
the amount of labor time involved. However, there were differences in how they calculated labor time and
in how they understood underlying values to be related to actual prices. Marx‗s belief that the exploitation
of labor is built in to capitalism is dependent on his version of the labor theory of value.
Karl Marx was a holistic thinker. He was primarily a philosopher, though his major field of interest was
clearly political economy.
The fundamental philosophical premises of the Marxian system of thought have been called dialectical
materialism, though this is a phrase that Marx himself never used. Dialectical refers to a logic-of-process
that Marx borrowed from Professor Hegel. Materialism refers to the importance of actual physical
experience in the determination of reality. Philosophers tend to start the presentation of any explanatory
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system by spelling out their ontology and epistemology. Ontology refers to the nature and relations of
being (the theory of reality); epistemology refers to how we think we know what we know (the theory of
knowledge). These philosophical concepts, and the premises section that follows, will seem very abstract
at first. However, the abstractions will be converted to solid historical examples as the discussion
progresses.
Premises of the Classical Marxist Model
The ontological premises of the dialectic are:
1. All phenomena are interrelated and interdependent. The relations between phenomena are more
important than the phenomena in and of themselves. The whole is always greater than the sum of
its parts (holism). This assumption differs from the basic analytical approach of conventional
science (including neoclassical economics), which focuses on the parts themselves. For example,
the market looks at the profitability of a single crop, not the overall ecological impact of
producing it. Because the conventional approach reduces larger entities into smaller, presumably
more manageable parts, it is known, especially among its critics, as reductionism.
2. All things are always in flux, always changing, always moving. Nothing is ever the same.
Nothing is constant. History is a moving stage, and it does not repeat itself. The dominant Greek
philosophical tradition held the contrary, namely that the underlying, essential reality was a fixed
state. The equilibrium approach of neoclassical economics follows in this tradition, as the
equilibrating outcome of the market is a balanced, at-rest state. Although actors may seek their
proper position, the stage itself is stationary.
3. ―Quantitative‖ changes are continuously occurring, which sometimes generates major or

―qualitative‖ changes. Qualitative transformations occur when an accumulation of quantitative
changes makes the original form unrecognizable or impossible. Qualitative changes can be
characterized metaphorically as metamorphoses in nature, like the change from larva into
butterfly. In societies, qualitative changes are revolutions, such as the agricultural revolution,
which emerged from the accumulation of many small, quantitative changes in technology and
social arrangements over centuries. By contrast, neoclassical economics sees all movement as
quantitative, that is, as shifting price arrangements. Revolutions or major social transformations
are not part of the neoclassical world view, as it takes an ahistorical stance.
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4. Change is evolutionary. However, the forward movement does not necessarily follow a simple
linear path. There can even be setbacks. Revolutions occur along the way. No pre-determined
historical path can be precisely identified; nor can any time frame be pre-established. However,
the general trend is progressive from simple to complex, and an overall outcome can be predicted.
That is, there is an end-inview. Therefore, the evolutionary process is teleological. The eventual
outcome can be broadly described, even though it is a moving state, as quantitative changes never
end. On the contrary, since neoclassical economics does not incorporate history within its basic
model, any discussion of evolution is irrelevant to it.
5. Change is driven by tensions, the internal oppositions within all things. Marx agreed with Hegel
that the dynamic of the unity of opposites characterizes all phenomena, from the atomic
coherence of negative and positive charges to the societal complementarity of conflicting classes.
Some Marxists call these oppositions ―contradictions,‖ which they see as natural, creative, and
logically sensible within a Hegelian type dialectical system. The opposing philosophical position,
which was held by Aristotle, regards oppositions and conflict to be unnatural and destructive.
Contradictions are illogical. Internally consistent order is the desired state. The market model of
neoclassical economics takes this approach. Supply–demand equilibria are harmonious, not
conflictual, relationships. Therefore, free market proponents see the economic dimension of a
market society as essentially harmonious.
The ontological premises of materialism are:
1. The fundamental level of reality consists of material—that is, physical—phenomena. Thus for
human beings the basic reality is acquiring food, eating, drinking, dealing with storms, struggling
with disease, joining with others, fighting with others, and so on. This assumption contrasts with
those who see ideas or symbolic pictures as more defining of reality. In their view, experience is
mediated through the shared concepts that people use to make sense of things. In fact, these
human-created cognitive structures actually define what is real. Hegel took this position; Marx
thought about it, but eventually rejected it as secondary to the material base of life.
2. Material phenomena have an independent, objective reality; that is, their existence is not
dependent on human perception or human conceptualization of them. Hurricanes happen whether
or not humans are around to experience them.
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3. Material conditions are the primary determinant of the character and qualities of all other
dimensions. In other words, the surrounding material or physical conditions that people
experience are more important in influencing how people think and behave than any other
influence. By attributing primary causal power to material conditions, Marx continued his
disagreement with Hegel, who gave thinking primary causal power. However, Marx did not
believe that the causal relationship was a simple one-way street. He understood that how people
thought did affect the way they experienced a particular material condition. Therefore, he saw the
relationship between material and cognition as interactive. Nevertheless, he still maintained that
material conditions dominated the interaction. If one were looking for a simple statement about
why something happened the way it did in a Marxian system, one could glibly attribute it to the
―material conditions.‖ The comparably simple catch-all explanation for the free market approach
would be ―supply and demand.‖ For the MCO perspective, it would be ―power negotiations.‖
The epistemological premises of dialectical materialism are:
1.The relationships among material phenomena are regular and lawlike.

2. Generalizations (laws) about these relationships are discoverable through an empirical process,
that is, a scientific method.
3. This scientific method, however, as mentioned above, must be holistic, not reductionist. It must
look at systemic relationships rather than discrete, unconnected, or incomplete parts.
4. Important relationships, that is, underlying oppositions, are often not revealed by superficial
observations, but must be inferred from relational dynamics. The dialectical method involves
looking for the real, underlying power dynamics, the ―hidden agenda.‖ People seldom will
publicly share, or in some cases even know, the real interests that are driving their behavior. By
contrast, according to Marxists, conventional science (positivism) limits itself to superficial
observation, thereby guaranteeing that, especially when applied to human activities, it will be an
endeavor focused mostly on trivialities. For instance, questionnaire or survey results almost never
provide any insights into people‗s real or actual sentiments. The ―useful knowledge‖ problem is
further compounded by the nature of individual-respondent data collection. Marxists are looking
for major structural and relational dynamics, but it is not possible to derive them from a simple
summation of individual responses. From the Marxist perspective, science in general, but
neoclassical economics in particular, suffers from this reductionism.
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5. In order for science to be accurate and contribute to the accumulation of real knowledge, it must
combine theory and practice. Scientists must be actively engaged in the matters that they are
studying. By itself, detached theorizing will not advance knowledge, as there is no meaningful
connection to reality, that is, the material conditions. Therefore, scientists must be a part of the
communities that they are studying, not detached observers. And, if these communities are
experiencing exploitation and injustice, then it is the scientists‗ obligation to assist in the process
of positive social change. Science, therefore, should be inherently and consciously political.
Conventional science strongly disagrees with this stance, as it believes that the objective pursuit
of truth requires detachment and non-involvement.
Marx‗s analysis of capitalism and human societies in general emerges from the world view that is
reflected in these assumptions. The dialectical approach in Marx‗s ontology definitely diverges from the
conventional scientific approach, though the materialist part of his ontology shares similar assumptions
with conventional empirical science. In fact, Marx called his approach scientific socialism. Marx‗s
epistemology starts out in agreement with conventional science, but it soon diverges on account of its
emphasis on holism. Marx believed in looking at the whole system (not just parts of it), incorporating
history, and looking for the underlying conflicts that tell the real story of what is going on. Without
engagement with the real world, science is sterile (Heilbroner, Marxism; McMurtry, The Structure of
Marx‗s World-View).
Applying these assumptions to human history, Marx reinterpreted all of human experience and created a
whole new history that was centered on the ways in which people make their living, rather than empires,
wars, and rulers. Friedrich Engels, his long-time collaborator and financial supporter, called Marx‗s
approach historical materialism. Marx believed that the fundamental and defining activity of humanity in
history was laboring in the production process and that it was always a pre-eminently social experience. It
always involved groups of people in relationship with each other and nature. Marx also observed that
societies tend to create class hierarchies in which some groups have more power than others, resulting in
the weaker groups being exploited. Part of the weaker groups‗ production is taken from them by the more
powerful. This confiscated production Marx called surplus. When Marx studied history, he observed a
number of qualitatively different societies. These different social formations Marx called modes of
production. The major examples were primitive communism, ancient civilizations, feudalism, and
capitalism.
Every dimension of a society, including its reproduction practices, the state, religion, and so on, is
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incorporated in its mode of production. To Marx, the concept mode of production was all-encompassing
and holistic. Marx put production at the center of his analysis because he believed that the material
experience and structure of production is the most important dimension of social life for determining all
other dimensions.
Interactions within the Classical Marxist Model
Before discussing further the different historical social formations that Marx identified, it is useful to
identify the analytical components of the mode of production. Though there is an interactive causal
relationship between the components, the instruments of production, or the technology utilized in
production, play the dominant causal role. The class structure within the relations of production reflects
the prevailing instruments of production and establishes the dynamic that generates the form and
substance of the other institutions in the society. Though these relations of production establish the range
of possibilities, outcomes are not strictly determined.
In fact, the prevailing beliefs or ideologies that justify the class structure may significantly influence other
changes occurring in the society, even the nature and pace of the underlying technological innovations.
Despite the causal uncertainty prevalent in Marx‗s historical analyses, he did seem to believe that the laws
of historical evolution would eventually bring about the communist mode of production. However, before
discussing the historical processes, let us first define the active components of the modes of production.
Forces of production
1. Instruments of production—the technology that is utilized in the production process.

Historically it has ranged from simple tools to major irrigation works to the massive machinedriven
factories of more recent times. These are invented and produced by humans. They are the
most important part of the material conditions that determine the evolution and qualities of the
social formation.
2. Raw materials—the basic inputs from nature, from minerals to cultivated crops. Changes in
technology determine which natural resources are considered valuable to the production process.
Oil pools, for instance, were dangerous traps to be avoided until someone discovered their energy
value in the nineteenth century. Together the instruments of production and raw materials make
up the means of production.
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3. Labor—the productive activity that people provide. Its effectiveness, or productive efficiency,
varies with the skill and knowledge possessed by the workers as well as the type of production
instruments available to them. Thus, the productivity of labor depends on these variables.
Relations of Production
1. Structure—In every social formation or mode of production except communism, there are
groups that control the means of production and groups that do not. This asymmetrical
relationship produces the fundamental group or class antagonism, the dialectical conflict, of the
particular mode of production. As Marx and Engels wrote in the Communist Manifesto, the
history of humankind is the history of class struggles. The nature of the classes and the nature of
the struggles vary from one mode of production to another.
2. Qualities—Every social formation or mode of production is an ―ensemble of social relations‖

that is shaped by the material conditions. Therefore, how people relate to each other, how they
govern themselves, what they believe, what religions they adhere to, what art they create, what
cultural practices they follow, and so forth, are primarily influenced by the existing forces of
production. Even human nature itself changes with the mode of production.
Historical Materialism
Marx‗s sweeping view of human history compacts all of human history into only five major modes of
production: primitive communism, ancient civilizations, feudalism, capitalism, and communism. As
noted above, the most important causal factor in the shift from one mode of production to another is a
change in the technology of production—the instruments of production. Different technologies of
production require different work arrangements. That should be evident to anyone who compares the
material working conditions of hunting and gathering societies vs. peasant agricultural societies vs.
industrial factory-based societies. At least that is what Marx thought.
Marx believed that humans were unstoppably creative. Consequently, new technologies would inevitably
and continually be invented. Eventually, those that were useful would be adopted. What, then, were the
technologies that facilitated the emergence of the qualitatively different modes of production in Marx‗s
simple historical schema? In the first historical mode of production, primitive communism, ―primitive‖
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refers to primitive production technology, the type that we associate with hunting and gathering societies.
These societies were made up of small, peripatetic bands that had no elaborate class structure. If we look
at the time scale of human history, we see that most of it has been spent in the first mode of production.
But the invention of settled agriculture about 6,000 years ago changed everything. Plants and then
animals were domesticated. Food production substantially increased and became more reliable.
Controlling land and large stores of food provided the motivation for developing the first highly stratified,
city-centered social formations. These ancient civilizations, such as those in Mesopotamia (current-day
Iraq), were the first to have the type of class structure that Marx identified as central to his analysis. He
identified the opposing classes in this mode of production as masters and slaves.
According to Marx, with the collapse of the Roman Empire in the fifth century, Europe moved on to the
next mode of production, feudalism. The centralized authority in Rome was replaced by thousands of
small, lord-controlled fiefdoms. Each lord had his manor and surrounding villages where the serfs lived
and grew food. The serfs were tied to the land and committed to providing a portion of their crop to the
lord, but the lord in turn was committed to protecting the serfs from invaders and ensuring basic
subsistence in case of crop failure. This arrangement was supported by a Church-sanctioned reciprocal
moral bond that existed between the lords and serfs. Feudalism‗s decentralization was facilitated by the
invention of water- and wind-powered mills that served as local sources of energy. This stood in contrast
to the large irrigation systems of ancient civilizations such as Mesopotamia, Egypt, and China that
required centralized control. Less than 5 percent of the population in medieval feudal Europe lived in
places that could be called cities. During the latter stages of the feudal period, especially starting in the
fourteenth century in the Italian city-states, technological developments occurred that would eventually
undermine feudalism. They included developments in banking, ship construction, navigation, and military
armaments that facilitated the rise of long-distance commerce and mercantile cities. A new class, the
merchants, emerged to provide the dialectical tension that challenged the feudal landlords and the
continuation of feudalism. From the sixteenth to the eighteenth centuries the merchants promoted a
system of international commerce known as mercantilism. Marx saw mercantilism as the transitional
stage between the feudal mode of production and the capitalist mode of production.
Along with the rise of the political power of the European merchant class, the really revolutionary
technological change that doomed feudalism in Europe was the invention of the industrial system of
production. Starting in the latter part of the eighteenth century, it created an entirely new set of material
conditions: production via machines and factories.
This dramatically new production system brought into existence the mode of production with which Marx
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was most familiar—the capitalist mode of production. Even though Marx was very critical of the
exploitative conditions created by capitalism, he also saw it as a necessary stage in historical evolution,
since it provided the unprecedented increase in output that was necessary for the elimination of poverty.
Marx believed that revolutionary action by the working class would assure that capitalism would
eventually be succeeded by the communist mode of production. In between there would be a transitional
period of socialism in which the government would own and control the means of production on behalf of
the laboring class. The final mode of production envisaged by Marx was communism, when class
conflict over the control and ownership of the means of production would be eliminated, as everybody
would collectively own and control the means of production. There would be no more class struggle. In
fact, there would be no more classes, though minor or quantitative changes would continue. Distributional
inequities would not be a problem as there would be enough for everybody: ―From each according to his
abilities; to each according to his needs‖ (Marx, quoted in McMurtry, The Structure of Marx‗s
WorldView, p. 225).
The Capitalist Mode of Production
First, let us take the definitional components of modes of production in general and specify the capitalist
content for each component. That will yield a picture of the characteristics of the capitalist social
formation. Then we will see how their interaction over time, according to Marx, will bring about the
eventual demise of the capitalist system.
Forces of Production in Capitalism
1. Instruments of production—industrial technology. In the first stage of capitalism, production is

centralized in factories where machines driven by inanimate energy are organized into assembly
lines. Machines now set the pace of production. The speed of technological innovation greatly
accelerates, and a process of continuous capital accumulation becomes institutionalized.
Productive activity and residency becomes increasingly centralized in cities.
2. Raw materials—shift from largely vegetable and animal substances to largely mineral and
eventually artificial (chemically created) materials. In capitalism raw materials are considered
commodities, and their exchange value is set by supply and demand in the market.
3. Labor—more productive in capitalism because of task division, better education, and capital
enhancement. However, labor power is also converted into a commodity and sold in the market.
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The wages of labor tend to approximate the cost of its reproduction (household food and shelter).
In most instances, laborers create more commodity value than it costs to reproduce them. Thus
there is usually a difference between the wages that workers receive and the market or exchange
value of the products they make. Workers are told that this is the correct valuation because it is
determined by the objective process of supply and demand in an impersonal market. Marx
believed that capitalists used this market rationalization to hide the exploitive reality of their
treatment of labor. Only in the case of the labor commodity is there this discrepancy between the
price paid for its labor power (wages) and the commodity production value that it creates. Marx
called this difference surplus value. Capitalists make most of their profit from the surplus value
that they extract from labor. Capitalists use their profits to invest in capital accumulation, the lifeblood of
capitalism.
All dividends, interest, and rent also come from surplus value. In other words, if capitalists were to lose
their ability to extract surplus value from workers, the whole capitalist system would collapse.
In order to ascertain the costs of labor reproduction (wages) versus the exchange value of the
commodities produced by labor, Marx relied on the labor theory of value. From this standpoint, Marx
argued that the exchange value of any commodity traded in the market would approximate the ―average
socially necessary amount of labor time‖ involved in bringing it to the market. Marx wanted a standard of
relative measurement that was drawn from many cases; thus the value comes from an average. He also
wanted to make sure that the available knowledge and technology were taken into account, plus he
wanted to be sure that laggards were not rewarded for their inefficiency, thus the qualifying phrase
―socially necessary.‖ Because the labor time value for any particular commodity was drawn from an
average of best-practice cases, the measure has also been called abstract labor. Remember that Marx was
positing a source of underlying relative values. Actual prices, for a variety of reasons, could diverge from
underlying values. In that respect, Marx‗s theory of value is no different from the market or MCO
theories of value as they also recognize the possibility of actual transaction prices diverging from the
theoretically predicted value differences. What distinguishes Marx‗s theory is the insight that he believes
it provides into the built-in exploitation of labor that is hidden within the price system of capitalism.
Relations of Production
1. Structure—Private property plays a key role in the class structure of capitalism, because capitalists
(the uling or dominant class) legally own as well as control the means of production. Workers (the
dominated or oppressed class) only control their own labor power. As a consequence of owning the
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means of production, the capitalists or bourgeoisie own the products that come out of the factories or
commercial farms.
Therefore, any profit made from the sale of products belongs to the capitalists. Since the discrepancy
between what a capitalist has to pay for labor (labor costs) and the revenue that the capitalist earns from
selling the products becomes the major source of profit, a fundamental class struggle is embedded in the
capitalist system over the extent of that expropriation. In the short run the only way a capitalist can
increase his profit is to pay less for labor. And vice versa: The only way that workers or the proletariat
can increase their wages is to reduce the capitalist‗s profit. Though it may be necessary to remain
competitive, increasing production efficiency and lowering costs through capital investment does not turn
out to be a successful long-term strategy for enhancing the rate of profit. Marx argued that is the case
because not only will all other capitalists make the same investment, but also the shift to using more
capital and less labor in the production process will reduce the only reliable source of profit, the
extraction of surplus value from labor. This paradox will be explained further below.
2. Qualities—Money dominates the capitalist mode of production. All economic transactions that count
are those priced by the market in monetary terms. All traded commodities receive an exchange value,
a price, through a supply–demand interaction in the market. As explained above, Marx believed that
there was a tendency for the exchange-value price of products to approximate the underlying labor
value. Marx further argued that all human relationships are mediated through what Marx called the
―veil of money,‖ a pervasive system of abstract valuation that hides the profound degree of
exploitation built into the capitalist system. Workers are told by the capitalist elite that their
marketdetermined wages reflect their real value, when in fact they are not receiving the true value of their
production. The economic ideology of capitalism obscures the underlying human realities. Land,
labor, and capital are conceptualized as physical commodities that receive a true market value for
their contribution. But in fact it‗s the landowner that receives the return on land, the capitalist that
receives the return on capital, and the laborer that receives the return on labor. These are all human
relationships of unequal power that the price system objectifies and obscures. The capitalistic market
transformation of conflictual human relationships into cooperative relationships between things, Marx
called commodity fetishism (Heilbroner, Marxism).
The capitalistic market system creates material conditions that reward behavior driven by greed,
aggressive competitiveness, and acquisitiveness. Marx believed that these qualities are not fundamental to
human nature, but they are fundamental to being successful in the capitalist system. Consequently, human
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relations in capitalism are characterized by alienation. People are alienated from each other because
monetary relationships replace genuine human relationships. Workers are alienated from the true value of
their production and from each other as they compete for jobs. Workers and capitalists are alienated from
each other in the class struggle. Capitalists are alienated from each other as they compete for profits.
Everyone is alienated from nature as it is turned into a commodity for sale in the market. Most people are
alienated from understanding the truly exploitative nature of the system by capitalist propaganda that
permeates popular culture. This propaganda purposely creates a ―false consciousness,‖ a
misunderstanding of the true nature of the system.
Marx contended that it was difficult for ordinary workers to break through false consciousness and the
veil of money, because every structure of power in the society is owned and/or controlled by the capitalist
ruling class. The capitalists run the government, no matter how democratic it is claimed to be. Capitalists
control the media. Capitalists co-opt organized religion, as it is dependent on funding from the wealthy
and political support from the state. The legal system, the art world, education, prevailing ideologies—all
are controlled by the capitalists on behalf of their interests. Of course, sometimes the capitalists may
allow some dissent and some pseudo-freedom, but only within the limits they consider safe. From Marx‗s
perspective, workers in capitalism are neither economically nor politically free. They are ―free‖ to be
―wage slaves‖ and ―political subjects.‖ Marx believed that capitalism was pervaded by high-flying
illusions that eventually would all fall down to earth.
Outcomes of the Capitalist mode of Production
With such a tight network of control, how could one imagine that the capitalist mode of production would
eventually be transformed into a qualitatively different mode of production? The answer lies in Marx‗s
dialectical ontology. Remember that it presumes an inevitable evolution from one qualitative state (mode
of production) to another, as long as there are driving oppositions. The driving opposition in capitalism is
the class struggle. Marx had to discover a necessary sequence of events, one based on scientific laws, that
would lead to the downfall of capitalism. And, of course, he did.
Marx believed that he had uncovered the process that would lead to the inevitable self-destruction of the
capitalist mode of production, based on the two key components of the system: (1) the exploitation of
labor and (2) the necessity for capital accumulation. We can understand this process by taking a
hypothetical example. If employees work 12 hours a day (not unusual in Marx‗s day) in a production
process that involves only labor, the exchange value of the product made by one worker in a day will tend
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to be 12 hours‗ worth (labor theory of value). If providing the subsistence of that worker requires 6 hours
of work, then his/her pay will equal 6 hours‗ worth. The remaining 6 hours of value, the surplus value,
would then belong to the capitalist. This 6 hours of surplus value is the basic source of profit. Half of the
value (50 percent) of the labor effort expended is, in effect, stolen from the worker. Thus the rate of
surplus value, or the rate of exploitation, is 50 percent. And in this case the rate of profit is also 50 percent
(percentage of total revenue kept by the capitalist after paying the costs—in this example, only labor).
However, very few products in capitalism are made solely by labor.
Some physical capital is almost always involved. In an imagined sequence of events in which the rate of
surplus value, as calculated above, is maintained at 50 percent, it can be shown how the increase in the
proportion of capital will lower the rate of profit—the most feared outcome for the capitalists, according
to Marx. But why do capitalists use more capital? They have no choice if they wish to keep up with
technological advances involving the use of capital that lower the per product cost of production. If they
do not keep up, they will lose their ability to compete in the market. The Table below shows four
hypothetical cases with different proportions of capital and labor. Each increase in the capital proportion
increases the productive efficiency of labor and lowers production costs, which leads to lower selling
prices in a competitive market. However, what the table demonstrates is the negative consequence for the
rate of profit when the proportion of ―live‖ labor in the production mix is lowered. As the proportion of
labor comes down, the source of surplus value also comes down. As surplus value—the only source of
profit—gets smaller as a proportion of total revenue, the rate of profit has to come down. The table
assumes that the rate of exploitation (50 percent) stays the same. This scenario makes sense only if you
accept Marx‗s view that, in a competitive market, labor is the only input from which capitalists can expect
a difference between cost and revenue generated. Even though physical capital includes the output of
past, or ―dead,‖ labor, Marx believed that only ―live‖ labor was exploitable, that is, capitalists could get
away with paying it less than the value it created.
Declining Rate of profit from changing labor-capital ratio with constant rate
The changing proportions of labor and capital associated with a fall in the rate of profit, as shown in the
above Table, have several dynamic implications. As capitalists use less labor and more capital,
unemployment tends to increase. With the increasing supply of labor, the market allows wages to go even
lower, increasing the rate of surplus value exploitation. Superficially, that action would seem to
compensate for the fall in the profit rates. But the poorly paid and partly unemployed labor force then has
less means to buy products, so the capitalists then find themselves with more products than they can sell.
Overproduction, or underconsumption, begins to dominate the local economy. An economic crisis ensues.
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Weaker firms go under, and stronger firms buy up their assets at less than their original value. Surviving
companies also look overseas for places to profitably sell their goods and to make investments so that
capital accumulation can continue. Eventually, with the emergence of new technologies, new products,
and new markets, the remaining bigger and stronger firms begin to make capital investments in the
domestic economy. They need to hire additional labor, whose new incomes generate more demand in the
economy. The process of expansion begins all over again. This pattern of economic volatility is inherent
in the capitalist mode of production. With this analysis, Marx had provided the first comprehensive
explanation of the business cycle in capitalism.
In Marx‗s scenario, the business cycle creates ever more severe depressions. In each subsequent economic
collapse, more and more small and medium-sized businesses go bankrupt or are absorbed into larger
businesses. Consequently, business ownership becomes more and more concentrated. Greater use of
capital in the production process leads to more workers becoming permanently unemployed, including
many intellectuals. Marx called them ―the industrial reserve army.‖ The army of the unemployed serves
the interests of capitalists because it enables them to pay lower wages. Each crisis in the system helps
workers to penetrate the veil of money and shatter the false consciousness behind which the capitalists
have been hiding. Eventually, Marx postulated, the workers would organize against this oppressive
system and overthrow the few remaining capitalists. As a paraphrase of his well-known call to the
barricades exhorts, ―Workers of the world unite, you have nothing to lose but your chains.‖ These
revolutionaries would then set up a socialist system run by workers, which would establish the material
conditions for moving on to the last mode of production, communism (Marx and Engels, The Communist
Manifesto).
In summary, the outcomes that Marx anticipated for the capitalist mode of production were:
1. extraordinary increases in production from unprecedented technological innovations and

regularized capital accumulation;
2. persistent inequality of income and exploitation of labor;
3. growing concentration of capitalist ownership;
4. pervasive alienation;
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5. overseas activities to acquire cheaper resources, additional markets, and capital outlets; and
6. deeper and deeper economic crises until finally the workers revolt and take control away from the few
remaining capitalists.
Capitalism is only one epoch, and a relatively short though necessary one, in the broad picture of human
history provided by Marx. To his historical parade of modes of production, Marx does have an end-
inview in which the exploitation that he despises begins to dissipate and eventually disappear.
That end-state, of course, is the communist mode of production. Under communism the material
conditions will no longer generate opposing classes, so that people will once again cooperate to create a
better society.
In order for communism to become the dominant mode of production, the central material condition that
must change is the private ownership of the means of production by the small ruling elite of capitalists.
Therefore, the first act of the revolutionary workers will be to establish the collective ownership of the
means of production. Second, they must eliminate the exchange value system that enables the exploitation
of workers. Third, they have to do away with the ―mind-numbing‖ division of labor entrenched in
capitalism that stifles workers and privileges unproductive occupations such as those in financial services.
However, the division of tasks will continue, as well as the planned coordination of the production
process.
There will be flexibility and turnover in the tasks that people fulfill, as it is important to prevent some
individuals from occupying high-status jobs on a permanent basis. Marx believed that people enjoyed
creative and cooperative work, and that communism would enable them to develop their highest
potentials.
Communism would be based on fully participatory democracy, as all the people would own and control
the means of production. That‗s why Marx foresaw not only the withering away of classes but also the
withering away of the state. Products would trade on their actual use values, not their exchange values, as
bank money and capitalist financial systems would be phased out. The competitive alienation of
capitalism would be replaced by humans freely associating with one another, leaving behind the
commodity fetishism of capitalism. People would not be driven by insatiable greed, as not only would
there be plenty for everybody (thanks to the high levels of production made possible by capitalism), but
also the cooperative working conditions would bring out a different side of human nature. Humans would
also recognize that they have a stewardship responsibility for nature once nature is no longer perceived as
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just another commodity. Marx did not believe that the fruits of the social production process in
communism would be divided equally. As noted earlier, his basic production and distribution principles
were ―from each according to his ability; to each according to his needs.‖ Even friendly critics see
Marx‗s
vision as rather utopian, but Marx maintained that the emergence of this future social formation was
based on likely outcomes predicted by the scientific laws of historical materialism (McMurtry, The
Structure of Marx‗s World-View).
Stalin‗s totalitarian police state was not at all what Marx had in mind. Stalin‗s justification for imposing a
centrally owned and run system was the necessity to prepare economically for the impending invasion
from Germany. During the 1930s both the fascist regimes and the Soviet Union were doing much better
economically, as they prepared for war, than the capitalist countries, which were still bogged down in the
Great Depression. Stalin‗s system of forced industrialization had a high human cost. The resistance of
small farmers to state confiscation of their land and animals (collectivization) resulted in millions of lost
lives. Classical Marxists, like Alex Callinicos, argue that Stalin‗s system was an aberration. It was neither
socialist nor communist.
Callinicos contends that if you take the defining characteristics of the Stalinist system—(1) a centralized
ruling class (Communist Party elite and planners), (2) extraction of surplus value from both workers and
farmers, and (3) continuous investment of the surplus value into capital accumulation
(industrialization)—you really have a version of capitalism. He called it ―bureaucratic state capitalism.‖
Giving the Stalinist Soviet system the name ―communism‖ was a great disservice to Marx (Callinicos,
The Revenge of History).
No political-economic model encompasses all aspects of human social systems, nor anticipates all the
relationships that actual history brings forth. So far Marx‗s effort comes closer than most others. As J. K.
Galbraith wrote: ―No one before, or for that matter since, had taken so many strands of human behavior
and woven them together‖ (The Affluent Society, p. 69).
Nevertheless, Marx never came close to finishing the agenda he set out for himself. He finished only the
first part of a projected six-part treatise on capitalism. Capital was to be followed by major works on
wage labor, landed property, the state, foreign trade and finance, and the world market and economic
crises (O‗Hara, in Encyclopedia of Political Economy). The next part in this book takes a look at how the
ideas that he did manage to put in writing have been applied to the contemporary world scene.
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2.3.2 Marxism and Imperialism
With the completion of the decolonisation process and the collapse of the Soviet Union, it might be said
that imperialism is a thing of the past. There are, however, several reasons why it is still an important
concept. First, it is the central concept of the Marxist approach to international relations. Second, it has
proved to be a remarkably resilient term. Despite the enormous changes in the last hundred years or so in
the fortunes of empire as a mode of political organisation, the term is still an important one in the
vocabulary of international politics (particularly in the vocabulary of radical states). This constitutes
prima facie evidence that the term refers to certain enduring features of the international system.
The Problem of Definition
Imperialism is a notoriously difficult term to define. The meanings it has acquired since entering the
political lexicon in the mid-nineteenth century are legion. In the early years of its history, ‗imperialism‗
was used to describe the dictatorial form of government practised by Emperor Napoleon III of France. In
the 1890s, it was used to describe the attempt by Germany to create a closed economic system protected
from foreign competition by high tariff walls – the kind of system advocated by List. Not until the turn of
the century did it acquire the meaning that it usually has today: the acquisition and control of undeveloped
territories by advanced industrial countries. But conceptual innovation has continued unabated. Lenin
famously defined imperialism not as the possession of overseas territories, but as a stage in the evolution
of capitalism in his Imperialism, the Highest Stage of Capitalism. Half a century later, the social theorist
Johan Galtung stretched the concept even further by, in effect, equating it with any form of international
inequality.
If we are to get a firm grip on this concept it is important to make a distinction between formal and
informal imperialism. The former denotes the acquisition of and direct control over specific territories.
This type of imperialism is indistinguishable from colonialism. Both involve overt administrative and
political control of colonies, these colonies usually being part of a much wider empire. The latter denotes
less explicit, even covert, control, influence or domination. It does not necessarily involve the destruction
of a country‗s formal sovereignty, that is to say its constitutional independence. It can, for instance, take
the form of a sphere of influence. It can be a product of unequal bargaining power, enabling one
economically powerful state to determine the economic policies of another, much weaker, state.
It can be even more diffuse than this: it is sometimes suggested that the US controls a ‗transnational
empire‗ by virtue of the strength of its multinational corporations and the influence of its culture.
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This distinction between formal and informal imperialism is crucial because much confusion has resulted
from a failure to separate them. It has been argued, for example, that Marxist theories of imperialism are
invalid because they cannot account for the ‗test case‗ of the ‗scramble for Africa‗ in the 1880s. It is
claimed that the growth of monopoly and the massive export of finance capital from the advanced
capitalist countries to the unexploited parts of the world – key factors in the Marxist explanation of
imperialism – occurred after, not prior to, the scramble. These things cannot, therefore, be said to be a
cause.
This may be true. But it does not disprove the Marxist case, since Marxists have been much more
interested in informal than formal imperialism. They have paid much greater attention to Asia and Latin
America than to Africa. This is significant because Asia was much less formally colonised than Africa,
and most Latin American countries achieved formal independence as long ago as the early nineteenth
century.
Marxist theories of imperialism have thus been judged on the basis of a definition of imperialism (that is
formal as opposed to informal imperialism) that their proponents do not accept, and in Marxism and
Imperialism the light of evidence from a part of the world (Africa) to which they have paid relatively little
attention. It would also be true to say that Marxists have tended to view imperialism not simply in terms
of a bilateral relationship between two countries, but as a condition of the entire world system.
At this point in the enquiry it might be asked: do the various definitions of imperialism share any
common ground? Is it possible to identify any core characteristics? Two propositions can be advanced.
First, imperialism involves domination. An imperialistic relationship entails more than ‗influence‗ or
‗persuasion‗, but it does not necessarily entail physical control. Second, imperialism involves domination
by economically advanced, or powerful, countries of underdeveloped, or economically weak, countries.
Theories of Imperialism
As well as different definitions of imperialism, there are a number of different theories. Before looking at
some of them, it is worth bearing in mind the following two points. Firstly, virtually all theories of
imperialism are attempts to explain international political events in terms of economic factors. They are,
in brief, economic explanations of foreign policy. Such an explanation has been given for every
significant conflict of the twentieth century, from the First and Second World Wars, to the Vietnam War,
the Gulf War, and the war between Britain and Argentina in the South Atlantic. The First World War has
often been held out as the paradigmatic example of an imperialist war. It was a direct result of the
increasingly ferocious competition among the major capitalist powers for new markets, new sources of
raw materials and new fields of investment. For many years this was the standard view of the political
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left, whether Bolshevik, Fabian or Social Democratic. The Second World War has been seen as the
culmination of capitalism in crisis. Nazism, Fascism, militarism and other phenomena commonly blamed
for the war were merely the pathological manifestations of a decadent and decaying capitalist system.
This was the underlying assumption of many of the books published in the 1930s by Victor Gollancz‗s
famous Left Book Club: Nazism, Fascism and militarism were the ‗immediate and superficial‗ causes of
the war; the real cause was the ‗crisis of capitalism‗, of which they were the symptoms. Similarly, it has
been argued that American intervention in Vietnam was only superficially an attempt to defend
democracy and contain the spread of communism. In reality it was an attempt by the US to secure the
supply of vital raw materials and maintain its control over essential markets. It was also an attempt to
‗make the world safe‗ for American capitalism. The Gulf War of 1991 has been portrayed as a war fought
to ensure the continued flow of cheap oil from the Middle East to the US and her capitalist allies. The
sovereignty of Kuwait, it is said, was an incidental factor. The coalition powers were not seriously
interested in defending Kuwaiti sovereignty. Nor were they interested, despite strenuous propaganda to
the contrary, in promoting democracy and human rights. Kuwait, after all, had no more claim to the status
of democracy than her belligerent neighbour, Iraq. Nor did the coalition‗s other principal ally in the
region, Saudi Arabia. If human rights had been an important concern, coalition powers such as the US,
Britain and France would not have supported Iraq in her long, bitter and bloody conflict with Iran. Yet
this support was substantial, and could not have but assisted the leader of Iraq, Saddam Hussein, in
tightening his brutal grip on his people. Even the war between Britain and Argentina over the Falkland
Islands in 1982 has been given an economic explanation. Though to many people a straightforward
conflict about territory and sovereignty, some have interpreted it as a Thatcherite conspiracy to stave off
an almost certain electoral defeat. At the time of the Argentinian invasion, the standing of Thatcher‗s
Conservative government in the opinion polls was at an all-time low. Never had a British government
been so unpopular. By going to war – a pointless, anachronistic, imperialist war – she cynically turned the
electorate‗s attention away from unemployment, poverty and inner-city riots. Mrs Thatcher, no political
innocent, knew that nothing unites a people like war. By opting for a violent solution to the Falklands
dispute, she turned an almost certain electoral defeat into a landslide victory. She thus preserved the
political ascendancy of the financial and commercial elite, the interests of whom it is the job of the
Conservative Party to defend and promote.
The veracity of such economic explanations of foreign policy need not detain us. The point is to note how
popular they are both in ‗everyday‗ and academic debates.
A second preliminary point to make about theories of imperialism is that although most are Marxist in
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orientation, not all of them are. There is a ‗realist‗ theory of imperialism. According to this theory,
imperialism is not a modern but an age-old phenomenon, and it has nothing to do with capitalism or,
necessarily, economics. It sees imperialism as an almost natural inclination on the part of independent
states towards territorial expansion. International politics is a struggle for power and, in the words of
Thucidydes, ‗the strong do what they will and the weak do what they must‗.
There are also a number of liberal theories. The Austrian economist Joseph Schumpeter, for example,
held that capitalism was inherently anti-imperialist. In his view, imperialism was caused by the survival,
after the advent of capitalism and industrialism, of certain anti-democratic social groups who had a vested
interest in conflict and war. The social groups generated by capitalism – the workers and the bourgeoisie
– had no interest in imperial conquest, but sometimes supported it due to the survival of certain irrational,
atavistic instincts. These anti-democratic groups and irrational instincts, he felt, would soon disappear
from the scene (and imperialism along with them) once capitalism and industrialism took firm root.
J.A. Hobson In 1902, the English liberal economist and social theorist, J.A. Hobson, published one of the
most important works on the subject, Imperialism: A Study. Hobson believed that imperialism was a
product of novel developments in the structure of advanced capitalist economies. He observed that the
economies of the leading capitalist countries were increasingly dominated by monopolies, trusts and
cartels. These large businesses were able artificially to increase their profits, since they were not subject
to the rigours of the market. Wealth was as a result being concentrated into fewer and fewer hands. Since
the wealthy have a high propensity to save, the ratio of saving to consumption in the economy was
increasing. But due to the unequal distribution of wealth, and consequently the limited purchasing power
of the masses, there was little point in investing these savings domestically. Industrialists and financiers
were thus compelled to look overseas for new fields of productive investment.
Hobson also observed that these industrialists and financiers exercised considerable political influence.
By pushing a lever here, and pulling a string there, they were able to manipulate state policy. In particular
they were able to gear the foreign policy of the state towards opening up these new fields of investment
overseas: by peaceful means if possible, by coercion – even direct annexation – if necessary.
In this way the capitalist was able to ‗use the public purse for the purposes of private profit‗. Indeed,
Hobson maintained that ‗the growing pressure of the need for foreign investments must be regarded as
the most potent and direct influence on our foreign policy‗.
It is important to note that although undoubtedly a structural theory, Hobson‗s theory of imperialism is
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not a Marxist theory (though it is often erroneously described as such). The key to understanding it is the
idea of ‗underconsumption‗. For Hobson, this was the ‗taproot‗ of imperialism. His solution was not
revolution, but reform, in particular the redistribution of wealth from the rich to the poor. This would not
only make society more equal and just, but more prosperous, and it would also remove the need for a
costly and dangerous foreign policy of imperialism. Purchasing power would be put into the hands of the
masses. The demand for goods and services would increase. Industrialists and financiers would no longer
need to look abroad for an outlet for their excess capital. Capital could once more be safely invested at
home.
The Marxist Tradition
The Marxist tradition is a broad one, and analysis of it is hampered by the fact that there are some writers
who have been heavily influenced by Marxist ideas who do not regard themselves as Marxists (for
example Immanuel Wallerstein), and others on whom the influence is not so great who are nonetheless
happy with the label (for example Johan Galtung).
The most fertile period of Marxist theorising took place in central Europe in the decade before the
outbreak of the war in 1914. The theories developed during this time are often termed ‗classical Marxist
theories of imperialism‗. The Austrian economist Rudolf Hilferding developed the concept of ‗finance
capital‗. His central argument was that financiers, not industrialists, were responsible Marxism and
Imperialism for the economic expansion occurring in the undeveloped parts of the world. The prominent
radical thinker and political activist, Rosa Luxemburg argued that capitalism was inherently
expansionary: it needed to expand in order to survive. Imperialism was inevitable, since sooner or later
the capitalist countries would have to compete with one another for the last remaining territories not
already subject to capitalist exploitation. The Bolshevik intellectual Nikolai Bukharin suggested that the
main participants in the world economy were not individual firms, but increasingly states. This was due to
the fact that competition within national boundaries was being progressively eliminated. Small businesses
were being swallowed up by large ones and single, huge, ‗state capitalist trusts‗ were in the making.
These state capitalist trusts – ‗Great Britain inc.‗, ‗America inc.‗, ‗Germany inc.‗ – would soon dominate
the world economy. Bukharin gave the name ‗imperialism‗ to the ferocious competition that was taking
place between them.
It is important to note that Marx himself did not use the term ‗imperialism‗, nor did he have a theory of it.
Writers like Luxemburg and Bukharin, however, were profoundly influenced by his theory of capitalist
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development, and by his work on the impact of capitalism on non-European societies. With respect to
imperialism, two aspects of Marx‗s theory are particularly important. Firstly, though he did not have a
theory of imperialism, he did have a theory of history in which capitalism plays a big part. This is
sometimes called historical materialism. Its basic tenet is that history is a product of the social forces of
production and the contradictions contained therein. The internal contradictions of feudalism led to its
downfall and the establishment of capitalism. The internal contradictions of capitalism similarly lead to
its downfall and the establishment of socialism. Each stage is a necessary precursor to the next. The
conditions for capitalism are established by feudalism and the conditions for socialism are established by
capitalism. The historical role of capitalism was particularly important for Marx. Capitalism, unlike the
modes of production it succeeded, was a dynamic force. It was driven by its own internal logic to expand
to every corner of the globe. In doing so, backward, pre-capitalist modes of production and their attendant
customs and habits, myths and superstitions would be dismantled, and the world united, for the first time,
under a single socio-economic system. At the same time, capitalism would give rise to the formation of a
worldwide urban proletariat, revolutionary class consciousness, and the conditions for the realisation of
socialism. Capitalism is thus a disturbing, dislocating, destructive force, but also a progressive one with a
vital historical task to perform: the destruction of backward social forms. This paradox, that capitalism is
destructive but also progressive, although central to Marx‗s thesis, is one that later Marxists have found
difficult to accept.
Secondly, it is important to note that Marx did not have much to say about the state. He regarded it as a
product of more profound material forces: a ‗superstructural‗ phenomenon. The state was thus an
instrument of the dominant, ruling class, and state policy was always a reflection of its interests. Again,
later Marxists have not been entirely happy with this view. Many came to feel that the state may have
more autonomy than Marx allowed. If true, this is important, since it means that foreign policy cannot be
reduced entirely to questions of social class.
The most famous Marxist book on imperialism is Lenin‗s Imperialism, The Highest Stage of Capitalism,
first published in 1917. It might be said that just as Cobden dramatically illustrated the international
political implications of Smith‗s analysis of the free market, Lenin dramatically illustrated the
international political implications of Marx‗s analysis of capitalism.
Lenin‗s work is by and large not original. He borrowed heavily from other radical writers, Hobson and
Hilferding in particular. He did, however, develop the important idea of the ‗labour aristocracy‗. Lenin
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attributed to this phenomenon the failure of the European working class to unite in opposition to war in
1914. Marxists were deeply puzzled when the plan of the Second International to resist war – an
‗imperialist‗ war – through a general strike failed to materialise. Instead, the workers fell into line behind
their respective national bourgeoisies, that is, they supported their national governments in their war
preparations, rather than opposing such preparations in solidarity with their fellow workers across Europe.
This was famously symbolised by the German Social Democratic Party voting for War Credits in the
Reichstag. Nationalism had spectacularly triumphed over socialist internationalism. The dream of the
Second International to bring capitalism crashing down through mass resistance to war was over. Lenin‗s
explanation for this development, contrary to all the teachings of Marxism, was that certain sections of the
proletariat – skilled workers – had been co-opted by the bourgeoisie. The
European proletariat had in effect been bribed to act contrary to its class interests. The European
bourgeoisie was able to do this because of the extra profits they had reaped from decades of colonial
exploitation.
Post-1945 Marxist and, Neo-Marxist‟ Theories
Since the Second World War, a number of theories of imperialism have emerged from the Marxist
tradition. The most prominent are dependency theory and world systems theory. By the 1960s it had
become clear that the majority of Third World countries were not prospering, despite the fact that they
had won their formal independence. Dependency theory and world systems theory offered new
explanations for why this was so. The core contention was that a country‗s development is conditioned by
the place it occupies in the capitalist system – a system characterised by a rigid division of
labour from which a country cannot easily escape.
It is important to emphasise four novel features shared by these new theories. Firstly, considerable weight
is attached to the concept of ‗under-development‗. This concept is used to denote the idea that capitalism
plunders pre-capitalist economies. Resources and ‗surplus value‗ are extracted, but nothing, except in
certain small capitalist ‗enclaves‗, is given in return. Development is, as a result, hindered rather than
helped, contrary to the teachings of both liberalism and classical Marxism. Indeed, the areas being
exploited are left in a worse state than they were before. Hence under-development.
Secondly, dependency and world systems theorists look at the world capitalist system as a whole rather
than as a sequence of national economies, each developing in its turn. Crucially, they see this whole
divided into a dominant centre and a dependent periphery. The centre develops at the expense of the
periphery. In the words of André Gunder Frank, a chain of exploitation exists linking corporate
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headquarters in New York, London and Frankfurt to semi-subsistence cultivation in the most peripheral
and poverty-stricken parts of the system. This is a major departure from classical Marxism, which, as we
have seen, sees capitalism as a progressive force. For dependency and world systems theorists, capitalism
is progressive for some (advanced industrial countries), but regressive for others (primary producing
countries). The only way for dependent countries to break out of this network of domination and
exploitation is to sever completely their relations with the capitalist system.
This is difficult to do, however, because of the existence of a ‗comprador‗9 class in the ‗periphery‗. This
is the third novel feature of post-1945 neo-Marxist theories of imperialism. This class consists of
westernised Third World elites with a stake in the existing system. In effect, they are in alliance with the
‗core‗ or ‗centre‗ countries because they have an interest in the exploitation of the ‗periphery in the
periphery‗. The existence of a comprador class, or the ‗core of the periphery‗, has ensured that attempts
to break free from the world system have been few and far between.
Fourthly, dependency and world systems theorists define capitalism as a mode of exchange: basically,
exchange for monetary profit on international or world markets. For Immanuel Wallerstein, the most
prominent world systems theorist, the capitalist world system has been in existence since the sixteenth
century. This contrasts sharply with Marx‗s view. For Marx, capitalism is a mode of production –
‗generalised commodity production for the market where labour is itself a commodity‗ – rather than a
mode of exchange. This mode of production only started to become dominant in the nineteenth century.
Perhaps the most important difference between Marx and Wallerstein is that whereas Marx sees
capitalism as taking root domestically and then spreading outwards – Das Kapital is primarily an analysis
of capitalism in Britain – Wallerstein sees capitalism as a world system from the outset, and sees
historical evolution not in terms of its spread, but in terms of its impact on its various component parts.
Critique of Classical Marxist Theories of Imperialism
Marxist theories have not gone uncriticised. The classical Marxist assumption that capitalism is a
monolithic phenomenon has been challenged. There may be several different kinds of capitalism, each
with very distinct characteristics. Consequently, more than one theory may be needed to explain their
evolution. It is also an interesting fact that if a ‗monopoly stage‗ of capitalism ever existed, it reached
some countries long before others. Take, for example, the US and Britain at the turn of the century. Of the
two, the US was most advanced along the road of monopoly but had a small empire. Britain lagged far
behind in monopoly terms but had an immense empire. According to classical Marxist theories, it should
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have been the other way around. Not unconnected with this, it is sometimes argued that Marxists
overestimate the influence that financiers and capitalists have on foreign policy. They may be able to pull
a string here and push a lever there, but so can the media, pressure groups (for example Amnesty
International, Greenpeace), special constituencies (for example the Jewish lobby in the US, farmers in
France), diplomats, generals, specialist advisors and so on.
An equally grave criticism of classical Marxism is that it underestimated the capacity of capitalism to
adapt to change. The highly regulated and rule-bound capitalism evident in most parts of the world today
– even the US – is very different from the one that prevailed in the nineteenth century. Classical Marxists
have underestimated the ability of the state to prohibit and dismantle cartels, monopolies and trusts; to
manipulate aggregate supply and demand in order to correct periodic systemic malfunctions; to
ameliorate suffering in periods of economic crisis; and to achieve certain economic and social goals
through the redistribution of wealth. They have underestimated the ability of organised labour to improve
the incomes and conditions of the mass of working people and greatly enhance their political influence.
Finally, they have underestimated the ability of capitalism to develop new and more productive
technologies and generate fresh desires to motivate workers and capitalists alike. In sum, the
‗immiseration of the masses‗ that Marx and his early disciples felt would bring down the capitalist
system has not occurred. Capitalism has proved a highly resilient and adaptable system. Rather than
immiserating the masses, in many parts of the world it has brought untold riches.
The success of the state in regulating and shaping economic processes and outcomes suggests that it is far
from the slavish instrument of a homogeneous ruling class that classical Marxists assumed. The state has
at least some degree of autonomy from the class structure of society. In addition, to the extent that a
ruling class exists, the evidence suggests that it does not always speak with one voice on matters of
foreign policy. Events such as the Spanish Civil War, the Vietnam War, and the Balkan wars of the 1990s
provoked a variety of responses from all sections of society. The ‗ruling class‗ in the principal capitalist
countries proved just as divided on how to respond to these tragic events as other social and political
groups. The assumption of homogeneity, therefore, is far from sound.
Finally, classical Marxist theories of imperialism have been criticized for being difficult to verify. What,
it has been asked, is the object of these theories? To explain war? To explain the acquisition of territories?
To explain the disarray of the Second International in 1914? To explain the periodic occurrence of crises
in the international economic system? The focus, or explanandum, of these theories is far from clear. This
has enabled their proponents conveniently to shift their ground when under attack. In the face of
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contradictory empirical evidence, they have been able to say: ‗but the theory is not concerned with X, but
rather with Y‗. This may be a rhetorical asset, but it is a liability when it comes to promoting a clear
understanding.
Critique of Neo-Marxist Theories
Neo-Marxists have been challenged over the concept of exploitation. It has been pointed out that this
concept, so central to post-1945 Neo-Marxist thinking, is peculiarly difficult to define. It is said that while
the prices of the manufactured goods of the industrialised ‗North‗ have steadily risen, the prices of the
primary products of the developing ‗South‗ have fallen. The South therefore suffers from ‗unfair terms of
trade‗. It has to export more and more of its primary produce in order to import the same amount of
manufactures. But how does one calculate a fair price? How does one calculate the exchangevalue of any
given commodity without at least some reference to supply and demand, that is the price that the market
is prepared to pay? Can all transactions in which one party benefits significantly more than another be
deemed ‗exploitative‗? Is it, indeed, true that Third World countries have suffered from adverse terms of
trade? The prices of some commodities – for example oil, aluminium, chromium – have performed well
relative to manufactures. In addition, empirical findings vary according to the year that is taken as the
‗base‗ of the calculation. If one‗s analysis begins during a boom period for commodity prices, and
terminates during a recession, it is likely to show that the terms of trade for these products has fallen. But
if one‗s analysis begins during a recession, and terminates during a Marxism and Imperialism 59boom, it
is likely to show the opposite. The available evidence suggests that the only safe conclusion that can be
reached on commodity prices is that they have tended to be more volatile than the price of manufactures.
These and other concerns have not been satisfactorily addressed by contemporary Marxist writers. The
confidence, therefore, with which the assertion that the Third World is a victim of continuous
‗exploitation‗ has been expressed is far from entirely justified.
Similarly, the concept of ‗dependency‗ is not entirely free of ambiguity. Dos Santos defines it as follows:
‗By dependence we mean a situation in which the economy of certain countries is conditioned by the
development and expansion of another economy to which the former is subjected‗. But what is meant by
‗conditioned‗ and ‗subjected‗? Arguably, all Dos Santos does in his definition is replace one ambiguous
term with two others.
Dependency theory has also been criticised for not paying sufficient attention to internal factors.
Corruption, government mismanagement, nepotism and the systematic denial of civil liberties have been
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common ills in the body politic of many Third World states since they achieved their independence in the
1960s and 1970s. It is these ills, rather than ‗structural imperialism‗, or the inherently exploitative nature
of the world capitalist system, that account for their continued impoverishment. Dependency theory is,
accordingly, simply a convenient means by which the plight of Third World countries can be dumped at
the door of foreigners. It provides the government of these countries with a convenient excuse for not
tackling problems the principal causes of which lie at home.
Finally, newer theories have been criticised for being unMarxist. This is the thrust of Bill Warren‗s
important study Imperialism: Pioneer of Capitalism. Warren argues that capitalist imperialism is
exploitative, and it does involve some degree of subjugation. But it is also, as Marx said, historically
necessary. Warren refutes empirically the central assertion of the dependency theorists that the Third
World is not developing. He shows that it is developing, though at an uneven pace – a fact, he insists, that
should surprise no one.
Unit Three
The Trading System
In simple terms, trade – that is the buying and selling or the exchange of goods – initially came about
when certain resources and commodities could not be acquired locally or within specific societies. As
societies grew and came into closer contact with one another, barter and trade became a fundamental form
of economic interaction. The emergence of a European system of sovereign states, in conjunction with the
discovery and exploration of new continents, and the gradual evolution and expansion of this system into
one of nation-states, set the foundations for international trade. Increased links between peoples, and later
states, that had control over different resources and commodities not readily available to all resulted in an
increase in the exchange of these goods. The Industrial Revolution, and the spread of its fruit,
industrialisation, led to the production and manufacture of goods, a process which required a variety of
raw materials from a variety of sources at home and abroad. In addition, the production of goods in ever
larger quantities required markets both at home and abroad. This further extended and deepened the
channels of economic interaction.
As a consequence, international trade came about when essential raw materials were not available, or it
was not economically efficient to manufacture goods domestically (or more accurately they could be
produced more efficiently elsewhere). The cost of purchasing these foreign goods was cheaper than
producing them at home.
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3.1 The Emergence free trade

Economists of every persuasion are convinced that free trade is superior to trade protection. In fact, they
consider free trade to be the best policy for a country even if all other countries should practice trade
protection, arguing that if other countries resort to trade protection, the economy that remained open
would still gain more from cheaper imports than it would lose in denied export markets. Despite this
powerful inclination within the economics profession to favor free trade and open markets, trade
protection has never totally disappeared; and indeed, during the past two centuries, restricted trade has
been a pervasive feature of the world economy. As economic historian Paul Bairoch has pointed out, free
trade has historically been the exception and protectionism the rule. Although nations want to take
advantage of foreign markets, they are frequently unwilling to open their own economies. Nations and
domestic interests alike fear a world in which market forces rule and relative prices determine the patterns
and distribution of the gains from trade. Throughout modern history, trade has been regarded either as an
international public good from which everyone benefits or a battleground in which there are winners and
losers. Even though the argument for free trade is powerful, trade protectionism continuously resurfaces
in new guises.
The classic era of free trade and international laissez-faire lasted less than three decades, from the repeal
of the Corn Laws (1846) to approximately the 1870s, when protectionist tariffs increased. From the latter
decades ofthe nineteenth century to the years immediately following World War II, trade protection grew
steadily and became increasingly prevalent up to and during the Great Depression of the 1930s. Following
World War II, the world again experienced an era oftrade liberalization and expansion, largely as a
consequence of successive rounds of trade negotiations carried out under the auspices of the General
Agreement on Tariffs and Trade (GATT) and strongly supported by American leadership. International
trade grew even more rapidly than did national economies. Consequently international trade integrated
national economies more closely with one another. In the mid-1970s, global stagflation, the New
Protectionism, and other developments slowed and, in some cases, reversed this liberalization trend.5 The
United States was particularly guilty of New Protectionism in its use of such non-tariff barriers as
―voluntary export restraints‖ to keep out Japanese and other imports.
Major steps were taken toward further trade liberalization with new rounds of trade negotiations, and
particularly with the successful completion of the Uruguay Round of trade negotiations (1993). The
Uruguay Round created the World Trade Organization (WTO) to replace the increasingly obsolescent
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GATT. However, new threats also surfaced in the form of managed trade, economic regionalism, and a
new trade agenda dealing with such problems as ―fair‖ labor standards and environmental protection.
Tension between free trade and trade protection has continued, and the future of a free-trade regime
remains precarious.
At the opening of the twenty-first century, the free-trade regime is threatened by intellectual, economic,
and political developments. The shift from ―comparative‖ to ―competitive‖ advantage as the basis of
trade, the implications of the new strategic trade theory, and other developments have undermined the
theoretical or intellectual arguments for trade liberalization. Increasing trade penetration into domestic
economies and national affairs has forced recognition of such complex problems as formulation of
definitions of ―fair and legitimate‖ economic behavior; that which is considered ―fair‖ in one society
may be considered ―unfair‖ in another. Trade issues have become focused on culture, national
sovereignty, and other complex issues that are not easily amenable to bargaining and compromise
solutions. In addition, political opposition to trade liberalization has grown among many groups
concerned about worker
welfare, the environment, and human rights. Many less developed nations now believe that the trading
system functions to their disadvantage. It is particularly noteworthy that the three major trading powers—
the United States, Western Europe, and Japan—became convinced that the political costs of lowering
certain trade barriers in response to demands from one or another major power had become unacceptable.
These several obstacles to further trade liberalization reached a crisis point at the November 1999 meeting
of the WTO in Seattle.
Revisions of Conventional Trade Theory: Heckscher-Ohlin (or H-O) model of comparative costs or
advantage
Since its development in the early 1930s by Eli Heckscher and Bertil Ohlin, the factor endowments or
factor proportions model has been accepted as the standard explanation of international trade. The
Heckscher-Ohlin (or H-O) model of comparative costs or advantage postulates that a country will
specialize in the production and export of those products in which it has a cost advantage over other
countries. This theory is based on assumptions of constant returns to scale, universal availability of
production technologies, and determination of a country‗s comparative advantage and trade pattern by its
factor endowments. This theory implies that:
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1. A country will export those products that are intensive in its abundant factor; that is, a capital-rich
country will export capital-intensive goods.
2. Trade will benefit the owners of locally abundant factors and harm owners of the scarce factors. Thus,
although all countries will benefit in absolute terms, there will be important distributive consequences
that will favor either capital or labor in trading countries (Stopler-Samuelson Theorem).
3. Trade in factors (capital or labor) and trade in goods will have the same effect and can fully substitute
for one another (Mundell equivalency).
4. Under certain circumstances, trade in goods will over time equalize the return (wages to labor and
profits to capital) for each factor of production (Factor-Price Equalization Theorem).
The basic problem with the H-O model or theory is that actual trading patterns frequently differ from
what the theory predicts. A notable example is found in intraindustry trade among countries with similar
factor endowments. Indeed, most trade among industrialized countries takes place largely in the same
product sectors; for example, the United States both exports to and imports from other industrialized
countries. As a consequence of the efforts by economists to explain this and other departures from the HO
theory, the concept of comparative advantage has been made increasingly elastic. Some economists
regard actual trade patterns as resulting from many factors other than natural endowments, factors
including historical accidents, government policies, and cumulative causation. Moreover, the standard HO
theory itself has been modified and expanded to include such important factors as human capital
(skilled labor), ―learning by doing,‖ technological innovation, and especially economies of scale.
Revisions have so transformed the original H-O model that some economists now argue that the theory of
international trade is not much more than an eclectic enumeration of the many factors that determine
comparative advantage and trade flows.
However, it is very difficult to incorporate these newly recognized factors into a formal model, and
because there is no satisfactory alternative model, economists continue to support the standard H-O
theory of trade based on factor endowments. As Richard Caves and Ronald Jones have argued, the
Heckscher-Ohlin theory, with its emphasis on factor endowments, is still largely valid. Moreover, as
economists argue, national specialization and the benefits of a territorial division of labor remain valid
concepts that are of overwhelming importance for the efficient use of the world‗s scarce resources. True!
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But this generalization does not explain or determine which country will produce what, and nation-states
will always be very reluctant to leave that decision entirely up to the market.
Concept of Human Capital
An especially important modification of trade theory followed Wassily Leontief‗s discovery of the
LeontiefParadox.18 In his research, Leontief discovered that the United States had a comparative
advantage in exporting labor-intensive goods, especially agricultural products and other commodities.
This empirical finding ran counter to the prediction that the United States as a capital-rich country would
have a comparative advantage in capital-intensive goods. According to the Stopler-Samuelson theorem,
derived from conventional trade theory, a country will export goods produced by its most abundant factor
of production and import goods made by its least abundant factor. The paradox or anomaly that Leontief
found in American exports was eventually resolved by introduction of the concepts of ―human capital‖
and of economies of scale into both trade theory and the neoclassical theory of economic growth.
Recognition of the importance and effect of investment in training, education, and know-how in the
United States, and of the resulting increase in the skills and productivity of American workers, explained
the Leontief Paradox. While the idea of human capital considerably enriched and extended our
understanding of international trade, it did make the original H-O theory less rigorous or, as economists
would say, less robust.
Rise of Intraindustry Trade
Since the reconstruction of Western Europe and the freeing of trade through successive GATT
negotiations, most trade has taken place, contrary to the H-O theory, between countries with similar factor
endowments; most exports of industrialized economies go to other industrialized countries. Such
intraindustry trade entails an economy‗s exporting and importing goods in the same economic sectors (as
in exportation of one type of automobile and importation of another type). Interindustry trade, on the
other hand, entails exporting and importing goods in very different economic sectors, such as exporting
manufactured goods and importing raw materials. Intraindustry trade has been a prominent feature of
north-north trade, whereas interindustry trade has tended to characterize north-south trade. How can
this type of trade among advanced industrialized economies be explained?
The Heckscher-Ohlin model predicts that most trade should take place among countries with dissimilar
endowments and that intraindustry trade should not even exist. If comparative advantage and trade
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patterns are determined by fixed endowments and relative prices, why should the industrial countries in
effect be ―taking in one another‗s laundry‖? This anomaly can be explained by differing national tastes,
product differentiation, and economies of scale. Americans, for example, traditionally like big cars, and
Europeans, small ones; Americans have tended to possess a comparative advantage in the former and
Europeans in the latter. Yet, there is a market in the United States for small European cars and vice versa.
Since the importance of intraindustry trade was recognized, the Heckscher-Ohlin model has been applied
primarily to trade between developed and less developed countries and not to the intraindustry trade based
on product differentiation and scale economies that is characteristic among industrial countries.
However, here another anomaly is encountered. Japan, during most of the latter half of the twentieth
century, imported a remarkably small share of the manufactured goods that it consumes. Unlike
Western European and U.S. trade, only a small portion of Japanese trade has been intraindustry trade—
that is, a two-way flow of trade within particular industries. For example, whereas Japan was the world‗s
largest exporter of automobiles for many years, its imports of automobiles and auto parts were negligible.
Instead, even in the 1990s, the pattern of Japanese trade continued to be largely interindustry trade; Japan
was importing mainly food, fuel, and raw materials and exporting mainly motor vehicles and other
manufactures. While this unique Japanese trading pattern began to change in the final years of the
twentieth century, it had long been a major source of economic conflict between Japan and its trading
partners.
Integration of International Trade and Foreign Investment
Another important development in the postwar era has been the increasing integration of international
trade and foreign direct investment (FDI) by multinational corporations (MNCs). When capital in the
form of portfolio investment became increasingly mobile across borders in the late nineteenth century,
economists assumed that international capital movements were due to differences among countries in
rates of return and in investment risk. When foreign direct investment—for example, the establishment of
a production facility by a firm of one nationality within another economy—became an increasingly
important feature of the international economy, economists assumed that FDI, like portfolio investment,
was due to differences in interest rates and that exports and foreign production were, in essence, perfect
substitutes for one another. This acceptance of the Mundell equivalency continues to pervade economists‗
attitudes toward FDI. Recently, a number of economists have begun to rethink the nature and significance
of foreign direct investment and have applied industrial organization theory to the behavior of
multinational firms and the determination of international trade patterns.
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The increasingly important role of the MNC in the world economy has resulted in a significant movement
toward internationalization of both services and industrial production. Organization of service industries
and of manufacturing on a regional or global basis has greatly affected the trading system. A substantial
proportion of world trade now takes place as intrafirm transfers at prices set by the firms and as part of
global corporate strategies. By the 1990s, this type of managed trade had become a prominent feature in
the international economy. In the late 1990s, over 50 percent of American and Japanese trade was
intrafirm trade. The resulting trade patterns frequently do not conform to conventional trade theory based
on traditional concepts of comparative advantage.
There is intense disagreement on the implications of FDI‗s increasing importance for international trade
and for the international distribution of wealth and economic activities. Assuming that investment and its
trade effects are just another application of the law of comparative advantage, many ifnot most
economists believe that FDI has only marginal implications for patterns of trade and that its distributive
effects are primarily domestic. Many noneconomists, however, believe that FDI and the activities of
multinational corporations have an immense impact on patterns of international trade and on the
distribution of wealth—and, I shall add—power. In addition, whereas most business economists believe
that the MNC is above politics and facilitates the rational organization and utilization of the world‗s
scarce resources to everyone‗s benefit, critics believe that MNCs pursue their own private interests
(and/or those oftheir home countries) to the detriment of everyone else.
From Comparative to Competitive Advantage
Another important intellectual development that has undermined the H-O theory of international trade is a
shift among economists from emphasizing ―comparative‖ to emphasizing ―competitive‖ advantage,
especially in high-tech sectors. International competitiveness and trade patterns frequently result from
arbitrary specialization based on increasing returns rather than from efforts to take advantage of
fundamental national differences in resources or factor endowment. This new thinking about the arbitrary
or accidental nature of international specialization and competitiveness emphasizes the increasing
importance of technology in determining trade patterns. The increasing importance of technology and of
economies of scale has become an important factor in corporate and national economic strategies.
In 1966, Raymond Vernon‗s product cycle theory of foreign direct investment incorporated technology
into trade theory; his work foreshadowed later writings on the importance of technological innovation for
trade and investment patterns. According to Vernon, American FDI in the 1960s could be explained
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primarily as a result of America‗s competitive advantage in product innovation and of the desire of
American firms to deter or forestall the rise of foreign competitors.
Additional influential work on the broad subject of the shift from comparative to competitive advantage
has been produced by Michael Porter, a professor at Harvard University‗s Business School. Through his
extensive research, Porter has attempted to explain why the firms of some countries have been more
competitive in specific industrial sectors than the firms of other countries. The United States, for example,
has been very strong in aircraft, while Japan has had an advantage in consumer electronics and
automobiles. Through his detailed and extensive empirical studies of the trading patterns of several
countries, Porter found determinants of such patterns, at least among industrialized countries.
The central finding of Porter‗s research was that the internal characteristics of a national economy
(including what I have identified as the national system of political economy) affect the environment of
domestic firms in ways that either facilitate or obstruct development of competitive advantage in certain
industries. According to Porter, several aspects of a national economy are particularly important: the
national culture and its influence on the purpose of economic activities, the status of capital and labor, the
nature of effective demand, the condition of supporting industries, and the industrial structure of the
economy. These several factors, Porter argues, determine domestic competitive conditions, and those
conditions in turn influence the international competitiveness of particular sectors of the economy.
Using specific industrial sectors as the units of analysis rather than the individual firm or the national
economy as a whole, Porter demonstrates that an economy with a competitive advantage in a particular
sector invariably has several strong firms in that sector. Intense domestic competition among these
oligopolistic firms confers on them their strong competitive position in international markets. Thus, for
Porter, the competitive advantage of Japanese firms in automobiles and consumer electronics is explained
by the supercompetitiveness of the domestic market. This supercompetition in Japan has been
concentrated on winning market share rather than profit maximization, and is carried out primarily
through product innovation, application of technology to productive processes, and great attention to
quality control rather than through the price competition characteristic of American firms. Intense
oligopolistic competition at the domestic level, Porter concluded, provided a better explanation of the
international competitiveness of Japanese firms in certain sectors than did any other factor, certainly more
than possible corporate collusion or government interventionist policies.
As a good economist, Porter eschews the importance of the nation itself as a factor in international
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competitiveness. However, in fact Porter is talking about the importance of differences in national
policies as an explanation of international competitiveness. Although it was not his intention, Porter
actually demonstrates that national governments do play an important role in helping or thwarting the
efforts of firms to create competitive advantage. Government policies can and do support or hinder the
supply-and-demand factors affecting the success of particular sectors. Furthermore, governments can
protect infant industries from international competition until they are strong enough to compete on their
own, and they can also foster technological innovation through support for R & D, assist domestic firms
to gain access to foreign technology, and protect proprietary knowledge from foreign competitors. In
short, a government can take a long-term perspective and establish policies that foster a favorable
domestic environment for those sectors most likely to be competitive in international markets.
As he substitutes the term ―competitive advantage‖ for the traditional emphasis of neoclassical
economics
on ―comparative advantage,‖ Porter‗s research strongly supports the idea that advantage in international
trade, at least in high-tech industries, can be and is created by deliberate corporate and national policies.
Comparative or competitive advantage results from deliberate corporate decisions and government policy
choices rather than appearing as a gift from Mother Nature. If international competitiveness is indeed
increasingly based on technological developments, learning by doing, and economies of scale, then
individual firms are ultimately responsible for creating or failing to create competitive advantage, but
governments can and do have an important and even decisive role in promoting their own national firms
in international markets.
Mainstream economists have been hesitant to acknowledge the increased importance of such factors as
technology and learning by doing in the determination of trade patterns. Nevertheless, the fundamental
idea that comparative or competitive advantage is largely arbitrary and a product of human intervention
rather than a fixed gift of nature is accepted by growing numbers of mainstream economists. Introducing
the concept of ―knowledge capital‖ as a determinant of economic growth and international
competitiveness, Grossman and Helpman argue that comparative advantage results from natural
endowments supported by experience. Moreover, they emphasize that nations with a head start in a
particular technology tend to strengthen their position over time, and that technologically deficit nations,
especially small nations, may find it impossible to ever catch up. As the idea of path dependence teaches
us, productivity increases with cumulative experience and is determined to a considerable degree by the
initial pattern of specialization.
These important considerations that ―international comparative advantage in the production of and sale
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of high-technology goods . . . . must be struggled for and earned through superior technological
innovativeness‖ has significantly intensified what F. M. Scherer has labeled ―international high-
technological competition.‖28 The drive for technological superiority has notably increased the receptivity
of governments to the ―new trade theory.‖
New Trade Theory
The most important and certainly the most controversial development challenging the conventional theory
of international trade is the ―new trade theory,‖ more commonly known as ―strategic trade theory‖
(STT). Therefore, I repeat here much of my earlier discussion of strategic trade theory. Strategic trade
theory is the culmination of earlier challenges to conventional trade theory because it incorporates a
growing appreciation of imperfect competition, economies of scale, economies of scope, learning by
doing, the importance of R & D, and the role of technological spillovers. STT is significant because it
challenges the theoretical foundations of the economics profession‗s unequivocal commitment to free
trade. In fact, STT originated with the development of new analytical tools and growing dissatisfaction
with conventional trade theory and its inability to explain the increasing trade problems of the United
States, especially with respect to Japan in the 1980s. The application to trade theory of novel methods
associated with important theoretical advances in the field of industrial organization provided the means
to develop an alternative to the H-O model. Mathematical models of imperfect competition and game
theoretic models were first incorporated into trade theory in the early 1980s by James Brander and
Barbara Spencer (1983), two theorists of industrial organization. Before I consider the theory, however, I
will discuss oligopolistic competition briefly.
Under conditions of perfect competition, strategic behavior is not possible because the behavior of one or
just a few firms cannot significantly change market conditions for other firms. However, if unit costs in
certain industries do continue to fall as output increases (economies of scale), the total output of firms will
expand but the number of firms will decrease. Economies of scale in an industry mean that the market
will support only one or just a few large firms; that is, the industry will become oligopolistic, and the
market will eventually be dominated by a few firms. This would permit the behavior of one firm to make
a difference and to alter the decisions of other firms. If imperfect or oligopolistic competition exists, then
monopoly rents or abnormally high profits can exist in that economic sector; the resultant rents or
superprofits could then be captured by a small number of firms or even by one firm. Individual firms,
then, may well pursue corporate strategies to increase their profits or economic rents.
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Oligopolistic firms can and do consciously choose a course of action that anticipates the behavior of their
competitors. If successful, such action enables them to capture a much larger share of the market than
would be the case under conditions of perfect competition. For example, oligopolistic firms can and do
follow strategies in which they adjust their own prices and output in order to alter the prices and output of
competitor firms. Two of the most important strategies used to increase a firm‗s long-term domination of
an oligopolistic market are dumping (selling below cost to drive out competitors in the product area) and
preemption (through huge investment in productive capacity to deter other entrants into the market).
Imperfect or oligopolisitc competition is most likely found in certain high-tech industries characterized by
economies of scale and learning by doing. The sectors most likely to become oligopolistic include
computers, semiconductors, and biotechnology; these technologies, of course, are identified by most
governments as the ―commanding heights‖ of the information economy. Many are dual technologies,
because they are very important to both military weaponry and to economic competitiveness. Many
countries consider it essential for both commercial and security reasons to take actions that will
ensure a strong presence in some or all of these sectors. The importance ofa head start in these industries
encourages firms to pursue a ―first-mover‖ strategy so that cumulative processes and path dependence
will strengthen their market position.
The theory of strategic trade takes the existence of imperfect or oligopolistic competition one step further
and suggests that a government can take specific actions to help its own oligopolistic firms. Government
policies can assist national firms to generate positive externalities (e.g., technological spillovers) and to
shift profits from foreign firms to national firms. Economists have long appreciated that a nation with
sufficient market power could enact an optimum tariff and thereby shift the terms of trade in its favor. By
restricting imports and decreasing the demand for a product, a large economy may be able to cause the
price of the imported good to fall. Strategic trade theory, however, goes much farther than optimum trade
theory in recognizing the capacity of a nation to intervene effectively in trade matters and thus to gain
disproportionately. A government‗s decision to support a domestic firm‗s plans to increase its productive
capabilities (preemption) or even to signal intention to build excess productive capacity exemplifies a
strategic trade policy. Through use of a direct subsidy to a firm or outright protection of a domestic
industry, the government might deter foreign firms from entering a particular industrial sector. Since a
minimum scale of production is necessary to achieve efficiency, especially in many high-tech industries,
the advantage of being first (―first-mover advantage‖) encourages a strategy of preemptive investment.
Strategic trade theory departs from conventional trade theory in its assumption that certain economic
sectors are more important than others for the overall economy and therefore warrant government
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support. Manufacturing industries, for example, are considered more valuable than service industries
because manufacturing has traditionally been characterized by higher rates of productivity growth and has
produced higher profits, higher value-added, and higher wages. Some economic sectors, especially such
high-tech industries as computers, semiconductors, and information processing, are particularly important
because they generate spillovers and positive externalities that benefit the entire economy. Because a new
technology in one sector may have indirect benefits for firms in another sector, firms that do extensive
research and development are valuable to many others. However, because firms may not be able to
capture or appropriate the results of their research and development activities, many will underinvest in
these activities. Proponents of strategic trade theory argue that such a market failure indicates that firms
should be assisted through direct subsidy or import protection, particularly in high-tech industries, which
frequently raise the skill level of the labor force and thus increase human capital. If, as the proponents of
strategic trade believe, such special industries do exist, then free trade is not optimal, and government
intervention in trade matters can increase national welfare.
Strategic trade theory has become a highly controversial subject within the economics profession. Some
critics argue that strategic trade theory is a clever, flawed, and pernicious idea that gives aid and comfort
to proponents of trade protectionism. Other opponents of the theory agree with this negative assessment
and maintain that the theory itself adds nothing really new to dubious arguments favoring trade
protection. Perhaps in response to the severe denunciations of strategic trade theory by leading
mainstream economists, some of its earliest and strongest proponents have moderated their initial
enthusiasm. Many economists consider STT to be an intellectual game with no relevance to the real world
of trade policy. Despite these criticisms and recantations, however, strategic trade theory has had an
important impact on government policy and has undoubtedly been a factor in the slowdown in the growth
of world trade.
What can be concluded about strategic trade theory and the industrial policy to which it provides
intellectual support? The case for profit shifting from one economy to another has neither been proved nor
disproved; it is difficult to assess whether or not government intervention in oligopolistic markets actually
works, because economists lack adequate models of the ways in which oligopolistic firms really behave,
and because the effects of trade policy in oligopolistic industries can depend to a critical degree on that
behavior. The positive externalities argument for strategic trade policy and its first cousin, industrial
policy, have strong support in the literature. Even though empirical evidence for the success of industrial
policy is admittedly mixed, government support for particular industrial sectors has frequently been very
successful in creating technologies that spill over into the rest of economy. Most importantly, there is
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strong evidence that government support for broad-scale R & D produces a very high payoff for the entire
economy. Certainly, governments around the world believe that providing support for high-tech industries
is a highly productive investment over the long term.
3.2 The GATT, WTO and Postwar Global Trade Regime
Throughout history, states have shifted between trade liberalization and protectionism. In the nineteenth
century, mercantilist trade restrictions gave way to freer trade. However, Britain‗s declining hegemony,
France‗s defeat in the Franco-Prussian War, and the 1873–1896 depression lowered the enthusiasm for
free trade; and the outbreak of World War I completely disrupted the European trade treaties. Tariffs rose
not only in European states recovering from the war but also in the United States, protectionism
continued to affect trade relations throughout the interwar period. To prevent a recurrence of the
protectionism of the interwar period, the United States and Britain began bilateral discussions in 1943 to
lay the groundwork for postwar trade negotiations. In 1945, a U.S. State Department document formed
the basis for multilateral negotiations that resulted in the Havana Charter, or charter for an international
trade organization (ITO) in 1948. In addition to trade policy, the charter dealt with economic
development, full employment, international investment, international commodity arrangements,
restrictive business practices, and the functions of an ITO. ITO was designed to provide an international
code to govern trade relations that would be subject to binding dispute resolution with ultimate appeal to
the International Court of Justice. The ITO‗s primary objective was to reduce barriers to international
trade and investment in order to secure economic reconstruction from the ravages of war and to build a
strong economic base to confront the perceived threat of communism.
However, the Havana Charter negotiations were protracted. Although the ITO Charter was signed by over
fifty participating states at the United Nations Conference on Trade and Employment in Havana in March
1948, ratification proved difficult for the United States, because the Charter‗s sweeping trade
liberalisation requirements was perceived as a threat to many US industries and could potentially
undermine US sovereignty. The proposed Charter‗s fate was sealed in 1950 when the Truman
administration, failing to overcome political opposition, withdrew it from congressional consideration,
thus terminating the ITO project. With the failure of the ITO to get off the ground, governments reverted
to the provisional agreement on trade and tariffs (GATT) agreed to at Geneva in 1947 and signed on 15
November 1947 at the Havana Conference.
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The GATT
The post-World War II trading system was born in conflict between American and British negotiators at
the Bretton Woods Conference (1944). Reflecting their industrial supremacy, US negotiators wanted free
trade and open foreign markets as soon as possible. Although the British were also committed to the
principle of free trade, they were extremely concerned over the ―dollar shortage,‖ possible loss of
domestic economic autonomy to pursue a full employment policy, and a number of related issues. The
eventual compromise agreement to create the International Trade Organization (ITO) left many issues
unresolved.
In 1948, the United States and its principal economic partners created the General Agreement on Tariffs
and Trade (GATT) to promote ―freer and fairer‖ trade, primarily through negotiated reductions of formal
tariffs. When the ITO was turned down by the U.S. Senate in 1950, the GATT became the world‗s
principal trade organization. The GATT is a fixed-rule trading system, and such a rule-based system is
quite different from managed or ―results-oriented‖ trade that sets quantitative targets or outcomes. The
GATT was also based on the principle of multilateralism; trade rules were extended without
discrimination to all members of the GATT; unilateralism, bilateralism, and trading blocs were prohibited
except in unusual cases. Another feature of the system was the principle of overall or general reciprocity;
that is, trade liberalization and rules were to be determined by mutual balanced concessions. A system of
specific reciprocity, on the other hand, requires that quite specific rather than general concessions must be
made. The principle of non-discrimination meant giving all kinds of trade between all types of countries
‗equal and fair treatment‗; within this, the most favored nation (MFN) principle meant that formal
agreements between any two member countries had to apply to all members, while the National
Treatment policy stated that any member of the GATT had to treat foreign firms in the same way as
domestic firms with regard to trade. It require members to treat foreign products—once they have been
imported—at least as favorably as domestic products with regard to internal taxes and regulations.
Finally, the principle of transparency declared that protectionist measures employed by governments
should be clearly stated and take a visible form (for example, as a tariff), this being aimed at eliminating
non-tariff barriers, such as systematic obfuscation by customs officials. The GATT also incorporated
provisions for the impartial adjudication of disputes. Although the principles of the GATT trade regime
were significantly qualified by escape clauses and exceptions, its creation was a major accomplishment,
and it has facilitated extremely important reductions in trade barriers.
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Weakness: The GATT proved remarkably successful in fostering trade liberalization and providing a
framework for trade discussions. However, in contrast to the abandoned ITO, its authority and the scope
of its responsibilities were severely limited; it was essentially a negotiating forum rather than a true
international organization, and it had no rule-making authority. Moreover, it lacked an adequate dispute
settlement mechanism, and its jurisdiction applied primarily to manufactured goods. The GATT did not
have authority to deal with agriculture, services, intellectual property rights, or foreign direct investment;
nor did the GATT have sufficient authority to deal with customs unions and other preferential trading
arrangements. Its power to resolve trade disputes was also highly circumscribed. By the mid-1980s, a
number of trade experts therefore warned that GATT had to upgrade its rules and dispute settlement
procedures; extend its discipline to agriculture and textiles; and begin to focus on newer areas such as
services and intellectual property. Successive American Administrations and other governments became
increasingly cognizant of the GATT‗s inherent limitations, and following the Uruguay Round, they
incorporated it in 1995 within the World Trade Organization (WTO), whose responsibilities and authority
are much broader and which is a full-fledged international organization rather than merely an
international secretariat (like the GATT).
The GATT, and later, the WTO, served the important political purpose of facilitating the reduction of
trade barriers. The principle of comparative advantage indicates that a nation would increase its gains by
opening its market to foreign goods; also, an open economy would enjoy lower prices, consumer choice,
and greater national efficiency. Nevertheless, because potential losers would strongly oppose lifting trade
barriers, proponents of free trade have to confront a mercantilist attitude that believes exports are good
and imports are bad. This attitude is revealed when trade agreements are characterized as ―concessions‖
to a foreign government. Because of this prevalent attitude, and for other political reasons, negotiated
reductions of trade barriers based on the principle of reciprocity are necessary. The political logic of the
GATT/WTO is that because liberalization harms certain interests that will inevitably oppose trade
liberalization, it is necessary to liberalize in a coordinated way with concession for concession, thus
making it easier to defeat protectionists. Once trade barriers have been lowered, a framework of
agreements makes it quite difficult to raise them again.
The GATT, despite the limitations of its mandate and its cumbersome organizational structure, was
important for many years in reducing barriers to international trade and in helping to establish rules to
reduce trade conflict. The GATT provided a rule-based regime of trade liberalization founded on the
principles of nondiscrimination, unconditional reciprocity, and transparency (for example, use of formal
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tariffs and publication of trade regulations); as trade relations constitute a Prisoner‗s Dilemma situation,
unambiguous rules are required to forestall conflict. Trade rules were determined and trade barriers were
reduced through multilateral negotiations among GATT members. In effect, GATT members agreed to
establish regulations lowering trade barriers and then let markets determine trade patterns; member states
pledged not to resort to managed or results oriented trade that set import quotas for particular products.
Under GATT, markets were opened and new rules established by international negotiations; agreements
were based on compromise or unconditional reciprocity rather than on unilateral actions by the strong or
by specific reciprocity. GATT‗s goal was an open multilateralism; that is, the agreement provided for
extension of negotiated trade rules to all members of the GATT without discrimination. However,
candidates for membership did have to meet certain criteria and agree to obey its rules. The founders of
the GATT wanted a steady progression toward an open world economy, with no return to the cycle of
retaliation and counter retaliation that had characterized the 1930s.
The Early Rounds of Trade Negotiations and the GATT
The postwar period witnessed a number of agreements to lower tariff barriers. The first round in Geneva
in 1947 resulted in 45,000 tariff concessions on trade in goods between the twenty-three attending
countries. The following three rounds of negotiations resulted only in unilateral and bilateral tariff
concessions among attending countries: twenty-nine countries attended the 1949 Annecy Round in
France, resulting in modest tariff concessions; thirty-two countries participated in the Torquay Round in
the UK in 1950/51, resulting in 8,700 tariff concessions; and a further meeting at Geneva in 1955/56,
with thirty-three countries participating, resulted in modest tariff concessions. Taking place after the
formation of the European Economic Community (EEC) in 1957, the Dillon Round, named after the US
secretary of the Treasury who led the talks, took place in 1960 and 1961 with thirty nine contracting
parties. This round tried to ensure that regional trade agreements did not raise average tariff levels among
other trading partners.
A significant shift in negotiations took place during the Kennedy Round (1964–1967). This round was
attended by forty-six countries. It was initiated by the United States as a response to growing concern
over the possible trade diversion or discrimination consequences of the European Economic Community,
substituted general reciprocity for the prior product-by-product approach to tariff cuts (specific
reciprocity). GATT members agreed to reduce tariffs on particular products by certain percentages and
made trade-offs across economic sectors. The Round resulted in a reduction of trade barriers on
manufactures of approximately 33 percent and in a number of basic reforms, including regulation of
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―dumping‖ practices. This Round extended the anti-dumping code adopted by the GATT (that is,
restricting a country‗s ability to dump goods elsewhere at prices below the cost of production). In
addition, preferential treatment was given to exports from less developed countries (LDCs).
The next major initiative to liberalize trade was the Tokyo Round (1973–1979), which, after years of
bitter fighting, proved far more comprehensive than earlier efforts. It included significant tariff cuts on
most industrial products, liberalization of agricultural trade, and reduction of nontariff barriers.
In addition, the industrial countries pledged to pay greater attention to LDC demands for special treatment
of their exports. However, the most important task of the Tokyo Round was to fashion codes of conduct
to deal with unfair trade practices like subsidies and countervailing duties, with discussions on technical
barriers to trade, mainly product standards, government procurement, customs valuations, importlicensing
procedures and revisions to the antidumping code. To this end, the negotiations prohibited
export subsidies and eliminated some discrimination in public procurement. However, that Round did not
resolve the serious American-European dispute over agriculture, satisfy the LDCs, or stop the noxious
proliferation of nontariff barriers that occurred as a consequence of the New Protectionism that had
commenced in the 1970s. The Tokyo Round ended at a time of economic crisis, marked by deep
stagflation. Many countries were using (unregulated) non-tariff barriers to restrict imports, while entire
economic sectors, such as agriculture and textiles, were slipping beyond GATT control. Powerful
countries, such as the USA, simply intervened directly and unilaterally, rather than through the GATT,
when they saw vital economic interests threatened. State industrial policies, such as those pursued by the
Japanese Ministry of Trade and Industry, were seen to be more effective in producing economic growth
than free trade. It was widely thought that the GATT was close to being finished (Prestowitz 1991;
Dunkley 2000: 34–41).
Nevertheless, trade-liberalizing agreements did enable international trade to grow rapidly. Substantial
expansion of trade meant that imports penetrated more deeply and trade became a much more important
component in domestic economies. In fact, in some European Economic Community countries, exports
soared. And even the domestic markets of the United States and Japan were internationalized to a
significant extent. It is particularly noteworthy that Japanese imports soon included a growing percentage
of manufactured goods. Meanwhile, GATT membership greatly expanded over the years, and growing
trade flows created a highly interdependent international economy, despite the 1970s slowdown.
The Uruguay Round (1986-1993) and World Trade Organization
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By the mid-1980s, the Bretton Woods trade regime was no longer adequate to deal with a highly
integrated world economy characterized by oligopolistic competition, scale economies, and dynamic
comparative advantage. In addition, the New Protectionism of the 1970s had led to the erection of
numerous nontariff barriers, such as quotas and government subsidies. Moreover, the character of trade
itself was changing and outgrowing the rules and trading regime of the early postwar era. Trade became
closely intertwined with the global activities of multinational firms, and trade in both services and
manufactures expanded rapidly; trade among industrialized countries became the most prominent feature
of the trading system. In the 1980s, the ―new regionalism,‖ especially acceleration of the movement
toward European integration, was recognized as a threat to the multilateral trading system. And at least
from the early 1980s, the United States pressured its West European and other trading partners for a new
round of trade negotiations to strengthen the multilateral trading system. Eventually, this American
pressure overcame European and other resistance, and the Uruguay Round of trade negotiations was
launched at Punta del Este, Uruguay, in 1986, resulting in intense negotiations until its conclusion in
1993.
The treaty produced by the Uruguay Round, which came into force on January 1, 1995, reduced tariffs on
manufactured goods and lowered trade barriers in a number of important areas. At the same time that
formal tariffs on merchandise goods were reduced to a very low level, the Uruguay Round decreased or
eliminated many import quotas and subsidies. The agreement‗s twenty-nine separate accords also reduced
trade barriers and for the first time extended trade rules to a number of areas that included agriculture,
textiles, services, intellectual property rights, and foreign investment. By one estimate, by the year 2002
the agreement should increase world welfare by approximately $270 billion. While many economists and
public officials praised the agreement, others emphasized the modesty of its gains. However, the longterm
effects of these achievements remain in doubt. Speaking of the agreement, John Jackson, a leading
expert on trade law, stated that the ―devil is in the details.‖
The Uruguay Round‗s most significant accomplishment was the creation of the World Trade
Organization (WTO). In doing this, the Round took an important step toward completion of the
framework of international institutions that had originally been proposed at Bretton Woods (1944).
Although the WTO incorporated the GATT along with many of its rules and practices, the legal mandate
and institutional structure of the WTO were designed to enable it to play a much more important role than
the GATT had played in governance of international commerce. The WTO has more extensive and more
binding rules. Moreover, the WTO has, in effect, the primary responsibility to facilitate international
economic cooperation in trade liberalization and to fill in the many details omitted in the 22,000-page
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Uruguay Treaty. That Agreement establishing the WTO expanded and entrenched the GATT principle
that trade should be governed by multilateral rules rather than by unilateral actions or bilateral
negotiations.
The World Trade Organization (WTO) is, in essence, an American creation. The WTO‗s predecessor, the
General Agreement on Tariffs and Trade (GATT) had served well America‗s fading mass-production
economy, but it did not serve the emerging economy equally well. As a consequence of economic and
technological developments prior to the Reagan Administration, the United States had become an
increasingly service-oriented and high-tech economy. Therefore, in a major effort to reduce trade barriers,
the Uruguay Round was initiated by the Reagan Administration and later was supported by the Bush
Administration and, after much vacillation, by the Clinton Administration as well.
Although the WTO was not given as extensive rule-making authority as some desired, it does have much
more authority than the GATT. The GATT dispute-settlement mechanism was incorporated in the WTO,
reformed, and greatly strengthened by elimination of such basic flaws as long delays in the proceedings of
dispute panels, the ability of disputants to block proceedings, and the frequent failure of members to
implement decisions. The agreement also established a new appellate body to oversee the work of the
dispute panels. Most importantly—and controversially—the WTO was empowered to levy fines on
countries that refused to accept a decision of the dispute panel.
The institutional structure of the trade regime also changed significantly. Whereas the GATT had been a
trade accord supported by a secretariat, the WTO is a membership organization that increases the legal
coherence among its wide-ranging rights and obligations and establishes a permanent forum for
negotiations. Biennial ministerial meetings should increase political guidance to the institution. The
Uruguay Round also created a trade-policy-review mechanism to monitor member countries.
3.3 WTO: Origin, objective, structure
Established on 1 January 1995, the WTO is a more formal, institutionalized version of the General
Agreement on Tariffs and Trade (GATT). Douglass North (1990) defined institutions as ―humanly
devised constraints that shape human interaction.‖ As an institution of international trade, the WTO sets
out ―the rules of the global trading game‖. These rules have force as international economic law.
The WTO‗s declared objective is to ‗help trade flow smoothly, freely, fairly and predictably.‗ It claims to
do this neutrally, by administering trade agreements, acting as a forum for trade negotiations, helping to
settle trade disputes, reviewing national trade policies, providing assistance to developing countries in
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trade policy issues through technical assistance and training programs, and cooperating with other
international organizations.
As an organization, the WTO consists of a director-general, four deputy directors-general and a secretariat
(or bureaucracy) housed in Geneva, Switzerland, where many UN agencies have their headquarters. The
WTO‗s highest authority is the Ministerial Conference, which includes all members and can make
decisions on all matters under the multilateral trade agreements. Whereas GATT normally met at the
ministerial level only to launch or conclude new rounds of trade negotiations, the WTO Ministerial
Conference meets at least every two years to increase the WTO‗s profile and provide guidance at a higher
political level. Between the Ministerial Conference meetings, the General Council manages WTO affairs
and oversees the Councils for Trade in Goods, Trade-Related Aspects of Intellectual Property Rights, and
Trade in Services. The General Council also convenes as the Trade Policy Review Body and the Dispute
Settlement Body when necessary. The Trade Policy Review Body conducts regular reviews of WTO
members‗ trade policies to increase transparency and promote trust that agreements are being enforced.
The Dispute Settlement Body forms panels to investigate complaints and adjudicate trade disputes. A
WTO member may invoke the dispute settlement procedures if another member has broken a WTO
regulation or reneged on previous agreements. Dispute settlement procedures are more binding and timely
under the WTO than they were under GATT. Whereas a single member (including a party to a dispute)
could block the adoption of a GATT panel report, a consensus of member states is required to block a
WTO panel report, a highly unlikely occurrence. A WTO member may appeal a dispute settlement
decision to the Appellate Body, but if the Appellate Body agrees with the panel report, the member must
implement the recommendations or provide compensation. If a member fails to implement a report or
provide compensation, the Dispute Settlement Body can authorize the complainant to retaliate.
The director-general is the chief administrative officer of the GATT/WTO. Unlike the tacit agreement
that the World Bank president would be American and the IMF managing director European, there was
no agreement for GATT. The WTO Secretariat has a staff of 550, mostly lawyers, and is headed by a
director-general and a deputy director-general. Like the IMF and the World Bank, it also exists as a
broader institution, in this case consisting of trade representatives sent from member countries to
meetings organized at a number of levels, and thousands of specialists, consultants and lobbyists who
exercise considerable power – the intricacies of trade regulations inviting expertise. Secretariat does not
have decision-making capacities. Secretariat‗s duties include supplying technical support for the various
councils and committees and the Ministerial Conferences, providing technical assistance for developing
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countries, analyzing world trade and explaining WTO affairs to the public and media. It provides legal
assistance in the dispute settlement process and advises governments wishing to become members of the
WTO. For years, the selection of GATT directors-general generated little controversy. However, the issue
became contentious when the WTO was formed for several reasons: the higher profile of the WTO; the
tendency for politicians to become WTO directors-general (unlike the case of GATT); greater U.S.
assertiveness in response to its declining trade hegemony; increased rivalry among Europe, the United
States, and Japan; and the South‗s unwillingness to accept the North‗s dominance in the GATT/WTO.
In contrast to the IMF and World Bank, the WTO (like GATT) is a one-nation, one-vote institution.
Depending on the issue, WTO votes require a simple majority, a special majority of two-thirds or
threequarters, or unanimity. The one-nation, one-vote system gives LDCs less influence than one might
expect because most decisions are made by consensus, and trade negotiations do not depend on vote-
taking. The WTO operates within a discourse that, while changing in emphasis over time, has consistently
advocated the ‗liberalization of trade‗ – that is, the freeing of international movements of commodities
and (recently) services from governmental restraint. Freeing trade from tariffs and other governmental
restrictions, and thereby allowing competition and markets to function more freely at the international
level, is said to lead to more rapid economic growth that benefits everyone. Trade liberalization is one of
the leading aspects of the post-war economic regime that led to global neoliberalism.
With over 130 members, however, the WTO‗s ability to carry out its assigned responsibilities is subject to
doubt. Despite the impressive achievements of the Uruguay Round in reducing trade barriers, many
vexing issues were left unresolved. Trade in certain areas such as agriculture, textiles, and shipping
continues to be highly protected. The failure to reduce tariffs on agriculture and textiles was and
continues to be especially vexing because lower tariffs would greatly benefit LDCs. Trade barriers are
still high in most developing countries, especially with respect to services, and developed countries
continue to restrict imports of automobiles, steel, textiles, consumer electronics, and agricultural products.
Completion of the Uruguay Round‗s so-called ―built-in‖ agenda is crucial, and the many issues
unresolved at the close of the negotiations remain problematic at this writing. In addition, since the end of
the Uruguay Round, a number of new and extremely difficult issues have surfaced, including labor
standards, the environment, and human rights. Even more ominous, American public opinion has become
more skeptical of the costs and benefits of trade, and by the late 1990s the WTO and trade liberalization
were clearly on the defensive.
New Threats to an Open Trading System
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In order to deal with the many issues left unresolved in the Uruguay Round and eliminate the many
barriers that continue to restrict free trade, in 1999 the WTO prepared to launch a Millennium Round of
trade negotiations. The proposed round was very ambitious, and the following issues were among the
important matters to be considered:
1. Further reduction of trade barriers on industrial products.

2. Reductions of barriers, particularly high tariffs in less developed countries, to trade in services,
including information technology, financial services, and telecommunications.
3. Reduction of fishing subsidies that promote over-fishing.
4. Simplification of customs procedures.
5. Increasing transparency in government procurement of goods and services.
6. Granting duty-free access to ADC markets for the poorest countries.
7. Extension of the interim agreement not to impose customs duties on Internet transactions or
ecommerce.
8. Paving the way for agreement on foreign investment and competition policy.
9. Reviewing WTO antidumping and antisubsidy rules to curb abuse of these otherwise legitimate
trade rules.
10. Reviewing problems in implementing existing (―built-in‖) agreements on textiles, intellectual
property protection, and investment rules.
11. Establishing a forum involving the World Trade Organization, International Labor Organization,
and United Nations Conference on Trade and Development (UNCTAD), as well as other
organizations to discuss links among trade, economic development, and labor questions.
The Millennium Round, where these important and highly controversial trade issues were to be
negotiated, was to be launched in November 1999 at a WTO trade ministers meeting in Seattle,
Washington. Unfortunately, strong differences among member governments, especially among the three
major economic powers, along with turmoil in the streets, resulted in near chaos and the collapse of that
conference. Launching of the Millenium Round therefore had to be delayed.
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Unit Four
The International Monetary System and the International Financial System
4.1 International Monetary System
4.1.1 The Balance of Payments
The balance of payments records the debit and credit transactions that residents, firms, and
governments of one state have with the rest of the world over a one-year period; it has two main
components: the current account, which includes all transactions related to a state‗s current
expenditures and national income, and the capital account, which includes all movements of
financial capital into and out of a state. As Table below shows, the current account comprises
four types of transactions:
1. Merchandise trade, or trade in tangible goods. The difference between the value of
merchandise exports and imports is the merchandise trade balance.
2. Services trade, or trade in intangible items such as insurance, information, transportation,

banking, and consulting. A state‗s merchandise and services exports minus imports (items 1
and
2 in the table) are equal to its overall balance of trade.
3 Investment income and payments measure interest and dividend payments on investments
bycitizens of a country to foreigners and by foreigners to citizens of the country. (This item is inthe
current account, because the investment income is in fact compensation for the servicesprovided by
foreign investments.)
4 Remittances and official transactions include income that migrant workers or foreign
companies send out of a country, military and foreign aid, and salaries and pensions paid to
government employees abroad.
Table 6.1 shows that in 1992 Japan had a current account surplus of $117.64 billion (U.S.) and
the United States had a current account deficit of $66.30 billion. The critical item for both
countries was the merchandise trade balance: Japan had a merchandise trade surplus of $132.40
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billion and the United States had a merchandise trade deficit of $96.14 billion. As The United
States has had merchandise trade deficits since 1971, and its largest trade deficits have often
been with Japan, and more recently with China. The table shows that in contrast to merchandise
trade, the United States had a positive services trade balance in 1992 (plus $42.32 billion). The
strong U.S. export position in services results from its skilled consultants and its highly
developed markets in insurance and banking. Thus, the United States applied pressure to include
services trade in the GATT and the NAFTA. The balance on U.S. investment income and
payments was also positive in 1992 (plus $20.40 billion) because of interest and dividend
payments received on past investments. However, the positive balances on services trade and
investment income were not sufficient to overcome the large U.S. merchandise trade deficit.
Thus, the U.S. current account balance was negative (minus $66.30 billion) in 1992.
The second major item in the balance of payments is the capital account, which measures longand short-
term capital flows (items 5 and 6 in Table 6.1). A country‗s capital exports are debit items because they
involve the purchase of financial assets from foreigners, and its capital
imports are credit items because they involve the sale of financial assets to foreigners. (This is
the opposite of merchandise trade, in which exports are credits and imports are debits.) Short
term investments normally have a maturity of less than one year, and long-term investments
extend beyond this period. Long-term capital flows are further subdivided into foreign direct
investment (FDI) and portfolio investment. FDI is capital investment in a branch plant or
subsidiary of an MNC in which the investor has some operating control. Portfolio investment, by
contrast, refers to the purchase of stocks and bonds that does not involve operating control.
A country often seeks to offset a current account deficit with foreign investment or an inflow of
funds into its capital account; a current account surplus by contrast permits a country to have a
capital account deficit through investment abroad or the purchase of foreign assets. As Table 6.1
shows, Japan (with a current account surplus) had a capital account deficit of $106.55 billion in
1992, and the United States (with a current account deficit) had a capital account surplus of
$36.58 billion. In addition to the current and capital accounts, the balance of payments includes
two less important items. The statistical discrepancy item results partly from errors in data
collection but mainly from a government‗s failure to include all the goods, services, and capital
that cross its borders. The final item is the change in official reserves. Each country has a central
bank such as the U.S. Federal Reserve or Bank of Canada that manages the money supply and
holds official international reserves as a buffer against economic problems. When a country has a
deficit in its current and capital accounts (the ―Total‖ item in Table 6.1), it loses reserves, and
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when a country has a surplus in its current and capital accounts, it adds to its reserves. The total
of a country‗s current account, capital account, statistical discrepancy, and change in reserves
always equals zero, hence the term balance of payments. Note in the above table that, by
standard accounting procedures, a minus figure equals an increase in reserves and a plus figure
equals a decrease in reserves. This is merely a bookkeeping exercise so the balance of payments
will equal zero. Thus, in 1992, U.S. reserves declined by $42.06 billion, and Japanese reserves
increased by $0.63 billion.
Although the balance-of-payments account always balances (i.e., equals zero) in a bookkeeping
sense, countries can have payments difficulties. When a country has a balance-of-payments
surplus or a balance-of-payments deficit, these terms refer only to the current and capital
accounts and exclude any changes in official financing. A government with a balance-ofpayments surplus
reduces its liabilities and/or adds to its official reserves, whereas a government with a balance-of-
payments deficit increases its liabilities and/or reduces its official reserves. The main body of the balance
of payments therefore informs us about a state‗s overall financial position.
Government Response to a Balance-of-payments Deficit
A country with large balance-of-payments surpluses may feel some pressure to correct its
imbalances in the longer term. Large payments surpluses can force up the value of its currency
making its exports more expensive for foreigners, and excessive official reserves can lead to
inflationary pressures and rising domestic prices. However, countries with payments deficits feel
more pressure to correct the imbalances than countries with surpluses, because a deficit country‗s
reserves can be depleted but a surplus country can increase its reserves indefinitely. Thus,
surplus countries normally view their payments disequilibrium as an economic asset, and we
focus here on a country‗s response to a payments deficit. A government with a payments deficit
has two policy options: to finance the deficit or adjust to it. Adjustment measures have political
risks because some societal groups must bear the adjustment costs in the present; thus,
governments often prefer financing measures that defer the adjustment costs to the future.
Adjustment Measures
Governments opting for adjustment rely on monetary, fiscal, and commercial policy instruments.
Monetary policy influences the economy through changes in the money supply. A central bank
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uses monetary policy to deal with a balance-of-payments deficit by limiting public access to
funds for spending purposes and making such funds more expensive. For example, a central bank
raises interest rates to make borrowing more costly, decreases the amount of money available for
loans by requiring commercial banks to hold larger reserves, and sells government bonds to
withdraw money from the economy. These policies can lower the payments deficit through a
contraction of the economy and decreased spending on goods and services. A government uses
fiscal policy to deal with a payments deficit by lowering government expenditures and raising
taxes to withdraw purchasing power from the public. (Countries with payments surpluses by
contrast often seek to expand the money supply, increase the budget deficit, and inflate the
economy.) Commercial policy lowers a country‗s payments deficit through trade by increasing
its exports and decreasing its imports.
A government‗s use of monetary, fiscal, and commercial policies depends on whether it opts for
external or internal adjustment measures. External adjustment measures such as tariffs, import
quotas, export subsidies, and currency devaluation are used to decrease imports and foreign
investment outflows and increase exports and foreign investment inflows. External adjustment
measures impose most of the adjustment costs on foreigners; foreigners often retaliate and
everyone loses in the long run. For example, external adjustment measures can result in the
competitive devaluation of currencies, with every country trying to lower the relative price of its
exports. Although a government may adopt external measures to avoid politically unpopular
decisions, even external measures impose some costs on domestic groups. For example, a
reduction of imports adversely affects importing businesses and the products available to
consumers. Internal adjustment measures include deflationary monetary and fiscal policies to
slow business activity and decrease the deficit; for example, higher taxes and interest rates
reduce spending by individuals, business, and the government. Internal adjustment measures
cause individuals and groups at home to pay more of the adjustment costs through
unemployment, lower living standards, business bankruptcies, and fewer publicly financed
programs. However, internal adjustment can also affect foreigners by deflating the economy and
lowering the demand for imports.
Financing
A country may also seek financing for its balance-of-payments deficit by borrowing from
external sources or decreasing its foreign exchange reserves. Financing is often the preferred
option when access to credit is available because it is easier to postpone difficult adjustment
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measures. However, financing may not be available over the long term; a country‗s reserves may
be depleted, and foreigners are reluctant to invest in a country with chronic foreign debt
problems. The United States has depended mainly on financing through its capital account (plus
$36.58 billion in 1992, in Table 6.1) to counter its current account deficit (minus $66.30 billion
in 1992). The United States has had persistently high current account deficits in recent years, and
its dependence on financing has resulted in a growing foreign debt. As Table 6.2 shows, in 2009,
China, Japan, and Germany recorded the largest current account surpluses while the United
States, Spain, and Italy had the largest current account deficits. The ―Rank‖ category gives each
country‗s ranking in a list of 190 countries. Whereas China ranked first with a current account
surplus of 296.2 billion dollars (U.S.), the United States ranked 190th with a current account
deficit of 380.1 billion dollars in 2009. Table 6.2 also shows that the merchandise trade balance
is the most important item in the current account of both countries. Whereas China had a
merchandise trade surplus of 272.5 billion dollars, the United States had a merchandise trade
deficit of 450.3 billion dollars. (The U.S. current account deficit was lower than its merchandise
trade balance deficit because of other items in the current account, including the services trade
balance and investment income and payments.) As a result of its chronic current account deficits,
the United States has the world‗s highest external debt, or the total public and private debt owed
to nonresidents by residents of an economy. Some analysts have argued that the U.S. deficits and
external debt are not a major concern for several reasons. First, although the United States has
the highest external debt, the debt is equal to only 25 percent of the U.S. GDP.
A number of countries with smaller economies have higher external debts as a percentage of
their GDPs. Second, the negative U.S. trade balance is not a valid measure of U.S.
competitiveness, because highly competitive U.S. firms often sell goods abroad through their
foreign subsidiaries rather than exporting them from the United States. For example, in 1998,
U.S. global exports of $933 billion were far less than U.S. foreign affiliate sales of $2.4 trillion.
Third, the United States often has higher trade and current account deficits when U.S.
productivity is increasing at a faster rate. For example, the United States had growing current
account deficits while Japan and the euro area had current account surpluses in the late 1990s.
The 1990s was a decade when the United States had sustained economic expansion, EU
economic growth was largely stalled, and the Japanese economy was often in recession. Thus,
U.S. trade and current account deficits may indicate that a vibrant U.S. economy is serving as the
largest market for other countries‗ exports. Fourth, some argue that the United States attracts so
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much foreign capital because others want to invest in the country. In view of this positive
balance on its capital account, the United States balances its payments by incurring a deficit on
its current account. Central banks in Europe and Asia will continue to buy U.S. dollars
indefinitely, so there is no effective constraint on U.S. borrowing.
A balance-of-trade surplus is certainly not the only measure of economic health, as Japan‗s
economic problems demonstrate. However, arguments that the U.S. trade deficit is of little
concern are not convincing. Regarding the first argument, serious questions are being raised
about the sustainability of the U.S. external debt, especially since the 2008 global financial crisis.
Regarding the second argument, a state‗s competitiveness is not synonymous with the
competitiveness of its MNCs. In assessing U.S. trade competitiveness and employment prospects
for U.S. workers, it is not sufficient to focus only on the sales of U.S. foreign affiliates.
Regarding the third and fourth arguments, the United States does sometimes have higher deficits
during periods of rapid economic growth, and it has been able to finance its deficits because its
large economy and political stability attract foreign investors. However, a number of problems
have resulted from the long-term U.S. deficits including a protectionist backlash against U.S.
liberal trade policy, a loss of U.S. manufacturing jobs and disposable income, increased leverage
of foreign governments with substantial U.S. dollar holdings, and disruptive market volatility
against the U.S. dollar. There are also geopolitical implications, because two of the largest
holders of dollar reserves—China and Russia—are U.S. rivals rather than allies. The degree to
which China and Russia diversify their holdings into euros and other reserves can have a major
effect on the future of the U.S. dollar as the top international currency.
Adjustment, Financing, and the Theoretical Perspectives
In reality, states usually employ a combination of external and internal adjustment and financing
measures to deal with payments deficits. Liberals, realists, and historical materialists have
different preferences regarding these policies. Orthodox liberals believe that governments should
adopt internal adjustment measures as a necessary form of discipline because they see payments
deficits as resulting from domestic inefficiencies. They oppose external adjustment measures that
raise trade barriers and distort economic interactions, and they oppose external financing because
it permits states to delay instituting internal reforms. Realists by contrast see internal adjustment
methods as posing a threat to a state‗s policy-making autonomy, and historical materialists
believe that LDCs should not have to bear internal adjustment costs in an international system
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that serves DC interests. External adjustment is much more acceptable to realists and historical
materialists. Realists view external measures as ―fair game‖ in a state‗s efforts to improve its
competitive position. For example, some analysts argue that the United States should adopt
external adjustment measures because Japan and China‗s manipulation of ―their currencies to
gain an unfair competitive advantage‖ has ―a substantial impact on exchange rates and the U.S.
trade deficit.‖Historical materialists argue that LDCs should impose import controls because of
their unfavorable terms of trade with DCs, and that DCs should provide LDCs with liberal
financing to help alleviate their balance-of-payments problems.
The Functions and Valuation of Money
Before tracing the development of monetary relations, it is important to be familiar with the
concepts of money and currency, which is simply money used as a medium of exchange. Money
serves three main functions:

services, or assets.


These functions depend on ideational as well as material factors, because ―the key to all three of
money‗s roles is trust, the reciprocal faith of a critical mass of like-minded transactors.‖ A
currency can serve effectively as a medium of exchange and a store of value only if individuals
are confident that it can be used in financial transactions without significantly losing its value.
Currencies can be priced by setting fixed exchange rates, by free markets, or by some
combination of the two. Devaluation occurs when a state lowers its currency‗s official price, and
revaluation occurs when it raises the official price. Depreciation refers to a market-driven
reduction in a currency‗s price, and appreciation refers to a market-driven increase in its price.
The international monetary system is the structure within which foreign exchange rates are
determined, international trade and capital flows are accommodated, and balance-of-payments
(BoP) adjustments made. All of the instruments, institutions, and agreements that link together
the world‗s currency, money markets, securities, real estate, and commodity markets are also
encompassed within that term.
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Arguments for More Stable Exchange Rates-Advocates of a return to more stable exchange
rates assert that the experiment with flexible (floating) rates has failed and that flexible rates
have resulted in excessive currency and price volatility, destabilizing international capital flows,
and inflationary economic policies. Excessive exchange rate volatility increases uncertainty and
risk in both international trade and foreign investment and thus impedes international economic
integration. Some experts also argue that volatility of currency values has decreased the
effectiveness of the price mechanism and of the principle of comparative advantage as tools in
international trade and foreign investment decision-making.
A foreign currency exchange rate or simply exchange rate, is the price of one country‗s
currency in units of another currency or commodity (typically gold or silver). If the government
of a country- for example, Argentina- regulates the rate at which its currency- the peso- is
exchanged for other currencies, the system or regime is classified as a fixed or managed
exchange rate regime. The rate at which the currency is fixed, or pegged, is frequently referred to
as its par value. If the government does not interfere in the valuation of its currency in any way,
we classify the currency as floating or flexible.
Devaluation of a currency refers to a drop in foreign exchange value of a currency that is

pegged to gold or to another currency. In other words, the par value is reduced. The opposite of
devaluation is revaluation.
Weakening, deterioration, or depreciation of a currency refers to a drop in the foreign

exchange value of a floating currency. The opposite of weakening is strengthening or
appreciating, which refers to a gain in the exchange value of a floating currency.
Soft or weak describes a currency that is expected to devalue or depreciate relative to major
currencies. It also refers to currencies whose values are being artificially sustained by their
governments. A currency is considered hard or strong if it is expected to revalue or appreciate
relative to major trading currencies.
4.1.2 Origin of International Monetary System
Over the ages, currencies have been defined in terms of gold and other items of value, and the
international monetary system has been the subject of a variety of international agreements.A
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review of these systems provides a useful perspective from which to understand today‗s system
and to evaluate weakness and proposed changes in the present system. Four regimes have
provided a degree of governance in international monetary relations:
1. the classical gold standard from the 1870s to World War I

2. a gold exchange standard during the first part of the interwar period
3. the Bretton Woods system from 1944 to 1973
4. a mixed system of floating and fixed exchange rates from 1973 to the present
1. The Classical Gold Standard, 1876-1913
Since the days of the Pharaohs (about 3000 B.C.), gold has served as a medium of exchange and
a store of value. The Greeks and Romans used gold coins and passed on this through the
mercantile era to the nineteenth century. The great increase in trade during the free-trade period
of the late nineteenth century led to a need for a more formalized system for settling international
trade balances. One country after another set a par value for its currency in terms of gold and
then tried to adhere to the so-called ―rules of the game‖. This later came to be known as the
classical gold standard. The classical gold standard was a regime based on fixed exchange rates,
in which national currencies had specific exchange rates in relation to gold, and countries held
their official international reserves in the form of gold. Governments were committed to
converting domestic currency into gold at the fixed rate, and individuals could export and import
gold. By stabilizing national currency values, the gold standard facilitated trade and other
transactions.
The ―rules of the game‖ under the gold standard were clear and simple. Each country set the rate at
which its currency unit could be converted to a weight of gold. The United States, for
example, declared the dollar to be convertible to gold at a rate of $20.67 per ounce of gold (a rate
in effect until the beginning of World War I). The British pound was pegged at £4.2474 per
ounce of gold. As long as both currencies were freely convertible into gold, the dollar/pound
exchange was:
Because the government of each country on the gold standard agreed to buy or sell gold on
demand with anyone at its own fixed parity rate, the value of each individual currency in terms
of gold-and therefore exchange rates between currencies- was fixed.
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Maintaining adequate reserves of gold to back its currency‗s value was very important for a
country under this system. The system also had the effect of implicitly limiting the rate at which
any individual country could expand its money supply. Any growth in the amount of money was
limited to the rate at which official authorities could acquire additional gold.
Although some states adhered to the gold standard more closely than others, it functioned
reasonably well because it was backed by British hegemony and cooperation among the major
powers. Britain helped stabilize the gold standard by providing other states with public goods
such as investment capital, loans, and an open market for their exports. The three states at the
center of the regime—Britain, France, and Germany—also defended their central banks‗ gold
reserves, maintained the convertibility of their currencies, and instituted domestic adjustments
when necessary to preserve the gold standard. Thus, Western Europe and the United States
maintained their official gold parities for about 35 years.The gold standard was based on the
orthodox liberal objective of promoting monetary openness and stability by maintaining stable
exchange rates. This was a period before Keynes introduced interventionist liberal ideas to
combat unemployment, and states were expected to sacrifice domestic social objectives for the
sake of monetary stability.
The gold standard as an international monetary system gained acceptance in Western Europe in
the 1870s. The United States was something of a latecomer to the system, not officially adopting
the standard until 1879.
2. Inter-War Years and World War II, 1914 – 1944
After World War I, in twenties, the exchange rates were allowed to fluctuate (exchange rates
floated freely), and central banks did not intervene in the foreign exchange market; but the
floating rates contributed to volatile currency values. Consequently, the trade could not develop.
Once a currency became weak, it was further weakened because of speculative expectations. The
reverse happened with strong currencies, because of these unwarranted fluctuations in exchange
rates, the trade volumes did not grow in proportion to the growth in GNP. Many attempts were
made to return to gold standard. U.S. could adopt it in 1919, U.K. in 1925 and France in 1925.
U.K. fixed pre-war parity. In 1934, U.S. modified the gold standard by revising the price of gold
(from $20.67/ounce to $35/ounce) at which the conversions could be effected.
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Till World War II practically the above practice remained in force. The gold standard to which
countries returned in mid-twenties was different than which existed prior to 1914. It is called a
gold exchange standard regime. The major difference was that instead of two international
reserve assets, there were several currencies, which were convertible to gold and could be termed
as reserves. Apart from pound, French Francs, U.S. dollar had also gained importance. Whenever
French accumulated pound sterling, they used to convert these into gold. The second difference
was that Britain had returned to gold standard with a decline in relative costs and prices.
By 1927, the major states established a gold exchange standard regime, in which central banks
held their reserves in major currencies as well as gold, and each central bank fixed the exchange
rate of its currency to a key currency (the British pound) with a fixed gold price. A gold
exchange standard permits more flexibility in increasing international reserves than a gold
standard because the reserves are not limited to the supply of gold.
However, the gold exchange standard did not operate as planned because some states had
persistent balance-of-payments deficits and others had persistent surpluses. The Great
Depression of 1929 put further stress on the gold exchange standard, and in 1931, Britain
suspended the convertibility of the pound sterling into gold. States gradually returned to floating
their currencies, but unlike the early 1920s this was a managed float in which central banks
intervened to deal with excessive fluctuations in exchange rates. Some theorists argue that the
failure to reestablish monetary stability in the interwar period resulted from Britain‗s inability as
a declining hegemon to stabilize policies; but others argue that the main factor was the growing
reluctance of states to sacrifice domestic goals such as full employment for the sake of currency
stability. Before World War I, voting in most states was limited, labor unions were weak,
farmers were not organized, and leftist parties were restricted. Thus, governments could stabilize
their currencies through policies that caused domestic hardship such as raising interest rates and
taxes and decreasing government expenditures. By the end of World War I, the extension of
suffrage, legalization of labor unions, organization of farmers, and development of mass political
parties gave domestic groups more influence. Thus, embedded liberal views that some
government intervention is necessary to deal with domestic economic problems took hold at this
time, and governments could no longer sacrifice the welfare of their citizens to maintain
monetary stability.
In 1931 the crisis began with the failure of a branch banking institution in Austria called Ke
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Kredit Anstalt. Had British, U.S. and French banks did not cooperated, this could have a small
impact on world exchange rate environment, but French banks did not cooperate. Germans
withdrew their money from Austria leading to deepening of crisis led to dismemberment of Gold
Standard.
3. Bretton Woods And The International Monetary Fund (IMF), 1944-1973
World War II was marked by a breakdown of monetary cooperation and a period of exchange
controls. Thus, of paramount importance to the representatives at the 1944 meeting in Bretton
Woods was the prevention of another breakdown of the international financial order. From 1918
until well into the 1920s the world had witnessed a rise in protectionism on a grand scale to
protect jobs for those returning the war, competitive devaluations designed for the same effect,
and massive hyperinflation as the inability to raise conventional taxes led to use of the hidden tax
of inflation: inflation shifts buying power from the holders of money, whose holdings buy less to
the issuers of money, the central banks. A system was required that would keep countries from
changing exchange rates to obtain a trading advantages and to limit inflationary policy. This
meant that some sort of control on rate changes was needed, as well as a reserve base for deficit
countries. The reserves were to be provided via an institution created for the purpose. The
International Monetary Fund (IMF) was established to collect and allocate reserves in order to
implement the Articles of Agreement signed in Bretton Woods.
The Bretton Woods planners established a gold exchange standard in which the value of each
country‗s currency was pegged to gold or the U.S. dollar as the key currency. A key currency is
the currency that nonresident private and public actors most often hold, use globally for crossborder
transactions, and purchase in the form of financial instruments such as bonds. Other states are also most
likely to peg their currencies to the key currency.
Unlike earlier monetary regimes, the Bretton Woods system was based on the embedded liberal
compromise. The postwar planners assumed that the pegged (or fixed) exchange rates would
provide the monetary stability needed for international trade, but they also provided for some
flexibility and assistance so countries could adopt domestic policies to combat inflation and
unemployment. This marked a contrast with the classical gold standard, in which exchange-rate
stability took precedence over domestic requirements. The embedded liberal compromise had
three major elements. First, the gold exchange standard was an adjustable-peg rather than a
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fixed-exchange rate system. Although countries were to maintain the par value of their
currencies in the short term, all countries other than the United States could devalue their
currencies under IMF guidance to correct chronic balance-of-payments problems. The IMF
framework for changing currency values was designed to provide more flexibility than the
classical gold standard and avoid competitive devaluations such as those of the interwar period.
Second, the IMF would provide short-term loans to countries with balance-of-payments
problems so they could maintain exchange rate stability. Third, countries could impose national
controls over capital flows. Speculative capital flows had led to instability during the interwar
period, and the negotiators feared that such speculation could undermine postwar efforts to
maintain pegged exchange rates and promote freer trade.
The Collapse of the Bretton woods System and the Emergence of the Floating (or Flexible)
Exchange Rate Regime
As we have seen, the most important feature of the Bretton Woods agreement was the decision to
have the U.S. dollar freely convertible into gold and to have the values of other currencies fixed
in U.S. dollars. The exchange rates were to be maintained within 1 percent on either side of the
official parity, with intervention required as the support points. This required to the United States
to maintain a reserve of gold, and other countries to maintain reserve of U.S. dollars. Because the
initially selected exchange rates could have been incorrect for balance-of-payments (BoP)
equilibrium, each country was allowed a revision of up to 10 percent within a year of the initial
selection of the exchange rate. In this basic form the system survived until 1971.
The central place of the U.S. dollar was viewed by John Maynard Keynes as a potential
weakness. Keynes preferred an international settlement system based on a new currency unit, the
Bancor. However, the idea was rejected, and it was not until the 1960s that the inevitable
collapse of the Bretton Woods arrangement was recognized by a Yale economist, Robert Triffin.
According to the Triffin Paradox, in order for the stock of world reserves to grow along with
world trade, the provider of reserves, the United States, had to run BoP deficits. These deficits
were the means by which other countries could accumulate dollar reserves. Although the U.S.
deficits were needed, the more they occurred, the more the holders of dollars doubted the ability
of the United States to convert dollars into gold at the agreed price. This built-in paradox meant
that the system was doomed.
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Among the more skeptical holders of dollars was France, which began in 1962 to exchange
dollars for gold despite the objection of the United States. Not only were the French doubtful
about the future value of the dollar but they also objected to the prominent role of the United
States was political, and part was based on the seigniorage gains that France believed accrued to
the United States by virtue of the U.S. role as the world‗s banker. Seigniorage is the profit from
―printing‖ money and depends on the ability to have people hold your currency or other assets at a
noncompetitive yield. Every government which issues legal-tender currency can ensure that it is held by
its own citizens, even if it offers no yield at all. For example, U.S. citizens will hold
Federal Reserve notes and give up goods or services for them, even though the paper the notes
are printed on costs very little to provide.
By the early 1970s, the requirements for adequate reserves—liquidity, confidence, and
adjustment—all presented serious problems: The U.S. balance-of-payments deficits created a
crisis of confidence in the dollar; countries were therefore reluctant to hold large supplies of U.S.
dollars for liquidity purposes; and the dollar could not be adequately adjusted through
devaluation because the dollar was to be ―as good as gold‖ (the Smithsonian agreements were
―too little, and too late‖). With the increased global capital flows, the Bretton Woods system of
pegged exchange rates was also becoming untenable. IMF members tried to reform the
international monetary regime, but their discussions failed because of differences among the
Americans, Europeans, and LDCs; destabilizing changes such as the 1973 increase in OPEC oil
prices; and Germany and France‗s preoccupation with establishing a European Monetary System
(EMS). Thus, the Bretton Woods regime of pegged exchange rates collapsed and was replaced
by a regime that permitted floating exchange rates.
4. The Regime of Floating (or Flexible) Exchange Rate
By 1973, the major trading nations were ―living in sin,‖ because they were ignoring the Bretton
Woods ban on freely floating exchange rates.The 1976 IMF meeting in Jamaica finally legalized
this situation by permitting each country to either establish a par value for its currency or shift to
floating exchange rates. In a free-floating regime, countries do not intervene in currency markets,
and the market alone determines currency values. IMF members often rely on managed floating,
in which central banks intervene to deal with disruptive conditions such as excessive fluctuations
in exchange rates. Although the IMF accepts managed floating, it opposes manipulative floating,
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which involves ―manipulating exchange rates . . . in order to prevent effective balance of

payments adjustment or to gain an unfair competitive advantage.‖ The current monetary regime
is mixed in nature: Major DCs such as the United States, Japan, and Canada (and a number of
LDCs) float their currencies; the EU members seek increased regional coordination of their
policies; and many LDCs peg the value of their currencies to a key currency or basket of
currencies. The choice of a pegged versus a floating currency can have consequences for
domestic groups in a state, and domestic as well as international factors therefore determine
whether a state decides to peg or float its currency. Thus, some analysts describe the current
monetary system as a ―nonsystem.‖
4.1.3 International Monetary Fund (IMF)
The International Monetary Fund (IMF), located in Washington, DC, was created to stabilize
exchange rates and provide member states with short-term loans for temporary balance-ofpayments
problems.
The objectives of the IMF were:
1. To promote international monetary cooperation through a permanent institution which provides the
machinery for consultation and collaboration on international monetary problems.
2. To facilitate the expansion and balanced growth of international trade, and to contribute
thereby to high levels of employment and real income and to the development of the
productive resources of all members as primary objectives of economic policy.
3. To promote exchange stability, to maintain orderly exchange arrangements among members, and to
avoid competitive exchange depreciation.
4. To assist in the establishment of a multilateral system of payments in respect of current

transactions between members and in the elimination of foreign exchange restrictions which
hamper the growth of world trade.
5. To give confidence to member governments by making the general resources of the Fund
temporarily available to them under adequate safeguards, thus providing them with
opportunity to correct maladjustment in their balance of payments without resorting to
measures destructive of national or international prosperity.
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6. In accordance with the above, to shorten the duration and lessen the degree of disequilibrium
in the international balances of payments of members.
The Articles of Agreement required IMF member countries to:
1. Promote international monetary cooperation
2. Facilitate the growth of trade
3. Establish a system of multilateral payments
4. Create a reserve base
Under the IMF Articles of Agreement, members had to peg their currencies to gold or the U.S.
dollar, which was valued at $35 per ounce of gold. Members also contributed to a pool of
national currencies available for IMF loans to deficit countries. Each IMF member is given a
quota based on its relative economic position, and its quota determines the size of its subscription
or contribution to IMF resources, its voting power, and the amount it can borrow from the IMF.
At regular intervals, the IMF adjusts members‗ quotas to accord with changes in their economic
positions.
Governance Structure of the IMF
Board of Governors
The Board of Governors is the highest decision-making body of the IMF. It consists of one
governor and one alternate governor for each member country. The governor is appointed by the
member country and is usually the minister of finance or the head of the central bank.
While the Board of Governors has delegated most of its powers to the IMF's Executive Board, it
retains the right to approve quota increases, special drawing right (SDR) allocations, the
admittance of new members, compulsory withdrawal of members, and amendments to the
Articles of Agreement and By-Laws.
The Board of Governors also elects or appoints executive directors and is the ultimate arbiter on
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issues related to the interpretation of the IMF's Articles of Agreement. Voting by the Board of
Governors usually takes place by mail-in ballot.
The Boards of Governors of the IMF and the World Bank Group normally meet once a year,
during the IMF-World Bank Annual Meetings, to discuss the work of their respective
institutions. The Meetings, which take place in September or October, have customarily been
held in Washington for two consecutive years and in another member country in the third year.
The Annual Meetings usually include two days of plenary sessions, during which Governors
consult with one another and present their countries' views on current issues in international
economics and finance. During the Meetings, the Boards of Governors also make decisions on
how current international monetary issues should be addressed and approve corresponding
resolutions.
The Annual Meetings are chaired by a Governor of the World Bank and the IMF, with the
chairmanship rotating among the membership each year. Every two years, at the time of the
Annual Meetings, the Governors of the Bank and the Fund elect Executive Directors to their
respective Executive Boards.
Ministerial Committees
The IMF Board of Governors is advised by two ministerial committees, the International
Monetary and Financial Committee (IMFC) and the Development Committee.
The IMFC has 24 members, drawn from the pool of 190 governors. Its structure mirrors that of
the Executive Board and its 24 constituencies. As such, the IMFC represents all the member
countries of the Fund.
The IMFC meets twice a year, during the Spring and Annual Meetings. The Committee discusses
matters of common concern affecting the global economy and also advises the IMF on the
direction its work. At the end of the Meetings, the Committee issues a joint communiqué
summarizing its views. These communiqués provide guidance for the IMF's work program
during the six months leading up to the next Spring or Annual Meetings. There is no formal
voting at the IMFC, which operates by consensus.
The Development Committee is a joint committee, tasked with advising the Boards of Governors
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of the IMF and the World Bank on issues related to economic development in emerging and
developing countries. The committee has 24 members (usually ministers of finance or
development). It represents the full membership of the IMF and the World Bank and mainly
serves as a forum for building intergovernmental consensus on critical development issues.
The Executive Board
The IMF‗s 24-member Executive Board conducts the daily business of the IMF and exercises the
powers delegated to it by the Board of Governors, as well as those powers conferred on it by the
Articles of Agreement. With the entry into force of the Board Reform Amendment on January
26, 2016, the all-elected Executive Board has been in place since the subsequent election took
effect on November 1, 2016. Previously, the member countries holding the five largest quotas
were each entitled to appoint an Executive Director, while 19 were elected by the remaining
member countries.
The Board discusses all aspects of the Fund‗s work, from the IMF staff's annual health checks of
member countries' economies to policy issues relevant to the global economy. The Board
normally makes decisions based on consensus, but sometimes formal votes are taken. The votes
of each member equal the sum of its basic votes (equally distributed among all members) and
quota-based votes. Therefore, a member‗s quota determines its voting power. Following most
formal meetings, the Board summarizes its views in a document known as a Summing Up.
Informal meetings may also be held to discuss complex policy issues at a preliminary stage.
Distribution of Voting power: The countries with the largest subscriptions and most votes in
the IMF are the G5—the United States, Japan, Germany, France, and Britain. In March 2010, the
G5 had 38.32 percent of the votes; the United States had 16.74 percent, followed by Japan with
6.01 percent, Germany with 5.87 percent, and France and Britain with 4.85 percent each. The G5
countries have enough votes to always appoint their own executive directors, and three other
countries—China, Saudi Arabia, and Russia (with 3.65, 3.16, and 2.69 percent of the votes,
respectively)—have also appointed their own executive directors. Coalitions of member states
elect the other 16 executive directors every two years.20 Although most IMF decisions are made
by consensus, the weighted voting is important because members are aware of ―the likely
outcome [of a vote] if the negotiation breaks down.‖21 Most IMF votes require a simple
majority, but 85 percent majorities are required for the most important decisions, such as
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changing the IMF quotas; these votes give an effective veto to the United States, the EU, and the
LDCs. However, the large, amorphous group of LDCs rarely joins together to block an IMF
decision. Thus, the weighted voting gives a good deal of control to the North.22 In April 2008,
the IMF Board of Governors adopted a proposal to increase the quotas and voting shares of
emerging market and low income countries in response to new economic realities. As of March
2010, 65 member countries representing about 70 percent of total voting power had accepted this
proposal; but the acceptance by at least 112 members representing 85 percent of the voting
power is required for these changes to be implemented.
The DCs also have the most influence in the IMF operating staff. By tacit agreement, the IMF
managing director has always been European, and the World Bank president has always been
American. Furthermore, in 2007, DC nationals accounted for 56 percent of the IMF professional
staff and 71.2 percent of the managerial staff. Gender disparities are also evident. All the IMF
managing directors have been men, and in 2007, men accounted for 64.1 percent of the IMF
professional staff and 84.4 percent of the managerial staff.
Sources of IMF‟s Financial resources:
The IMF‗s financial resources come mainly from the capital subscriptions that countries pay
when they join the organization or, following periodic reviews, when quotas are increased.
Countries pay 25 percent of their quotas in ‗hard‗ or readily convertible currencies, such as US
dollars or Japanese yen and the rest in their national currencies. Quotas determine a country‗s
subscriptions, its voting power, and the amount of financing it can receive from the Fund.
Quotas reflect the size of a country‗s economy and its volume of trade. The IMF can also borrow
further under two sets of standing arrangements: the General Arrangements to Borrow (GAB),
set up in 1962, with eleven participants (the governments or central banks of the Group of Ten
industrialized countries and Switzerland); and the New Arrangements to Borrow (NAB).
Countries usually approach the IMF for financing when they are experiencing balance of
payments problems. Countries can immediately and unconditionally draw on the 25 percent of
their quota (called a ‗tranche‗ or portion) originally deposited in hard currency or gold. Should
this be insufficient, they can then draw up to three times their original quotas (in hard
currencies)based on fulfilling conditionalities (i.e policies).
IMF conditionality ensures that borrowers must agree to adopt specific economic policies in
370
return for IMFfunding, and the conditions become more stringent as a member borrows more
from the IMF in relation to its quota. LDCs feel strong pressure to abide by IMF conditionality
because they depend on IMF loans, and DCs and private banks often require the acceptance of
IMF conditions before providing their own loans and development assistance. These conditions
were designed to ensure that corrective macroeconomic policy actions would be taken. IMF
officials usually require borrowers to adopt contractionary monetary and fiscal policies so they
can correct their balance of-payments problems and repay their IMF loans. However, many loan
recipients feel that IMF conditionality infringes on their sovereignty and does not address the
basic structural problems hindering their economic development.
4.2 International Financial System
4.2.1 What Is a Financial System?
A financial system is a set of institutions, such as banks, insurance companies, and stock
exchanges, that permit the exchange of funds. Financial markets involve borrowers, lenders,
and investors negotiating loans and other transactions. In these markets, the economic good
traded on both sides is usually some form of money: current money (cash), claims on future
money (credit), or claims on the future income potential or value of real assets (equity). These
also include derivative instruments. Derivative instruments, such as commodity futures or stock
options, are financial instruments that are dependent on an underlying real or financial asset's
performance. In financial markets, these are all traded among borrowers, lenders, and investors
according to the normal laws of supply and demand. Borrowers, lenders, and investors exchange
current funds to finance projects, either for consumption or productive investments, and to
pursue a return on their financial assets. The financial system also includes sets of rules and
practices that borrowers and lenders use to decide which projects get financed, who finances
projects, and terms of financial deals.
In a centrally planned financial system (e.g., a single firm or a command economy), the
financing of consumption and investment plans is not decided by counterparties in a transaction
but directly by a manager or central planner. Which projects receive funds, whose projects
receive funds, and who funds them is determined by the planner, whether that means a business
manager or a party boss.
371
Financial systems exist on firm, regional, and global levels. The global financial system is
basically a broader regional system that encompasses all financial institutions, borrowers, and
lenders within the global economy. In a global view, financial systems include the International
Monetary Fund, central banks, government treasuries and monetary authorities, the World Bank,
and major private international banks.
What is International Financial System?
The financial system, consisting of financial institutions, financial instruments and financial
markets, provides an effective payments and credit system and thereby facilitates channeling of
funds from the savers to the investors in the economy. The international financial system is a
structure of markets within which organizations and individuals trade to support economic
commitments made across national borders. There is no single market for all international
financial transactions. Many different financial instruments are traded in many different markets.
The markets are often linked by economic agents who operate in several markets, either at once,
or in sequence. Prices established in one market may affect the outcomes of trade in others, often
in other countries. The origins of international financial transactions lie in the need to support
international trade in real goods and services. However, the financial markets have grown
enormously, and today most market activity is comprised of trade in financial assets for reasons
that have little to do with the financing of real trade.
International Financial Markets
International financial market born in mid-fifties and gradually grown in size and scope. Just as
domestic financial markets have two segments short-term money market and capital marketinternational
financial markets do also have these two segments. In the short-term money
markets funds for short periods are loaned and borrowed. Commercial banks and non-bank
financial intermediaries participate in this market. In the capital market long –business houses
through equity and bond issues raise term capital. Development bank and long-term financial
institutions participate in the market. Sovereign governments and public sector enterprises too
issue bonds to meet their financial needs.
International financial markets comprises of international banks, Eurocurrency market, Eurobond
372
market, and international stock market. International banks play a crucial role in financing
international business by acting as both commercial banks and investment banks. Most
international banking is undertaken through reciprocal correspondent relationships between
banks located in different countries. But now a days large bank have internationalized their
operations they have their own overseas operations so as to improve their ability to compete
internationally.
Eurocurrency market originally called as Eurodollar market, which helps to deposit surplus
cash efficiently and conveniently, and it helps to raise short-term bank loans to finance corporate
working capital needs, including imports and exports.
Eurobond market helps to MNCs to raise long-term debt by issuing bonds. International bonds
are typically classified as either foreign bonds or eurobonds. A foreign bond is issued by a
borrower foreign to the country where the bond is placed. On the other hand Eurobonds are sold
in countries other than the country represented by the currency denominating them.
Growing importance of IF
Over the last decades international financial flows have grown much faster than world GDP or
world trade. This trend is in large part a reflection of international trade and the process of
globalization. However, international financial flows have grown much faster than the real
economy. Between 2002 and 2007 (before the start of the current crisis international financial
flows (gross) have grown from 5% to 17% of world GDP. While IF contributes to world
prosperity through the efficient allocation of capital worldwide, it is also a source of concern for
the challenges that it poses for financial stability as shown by the recent financial crises.
Financial flows are extremely volatile. After the Lehman default (gross) international financial
flows plummeted to 1% of GDP in 2008!! IF has become as subject of immense importance and
a great deal of attention is being payed to gain a better understanding of the way financial
markets work.
Factors behind the growth of IF


Acquisition (M&A) activity) and Multinational Banking
373

 ernational Finance per se (finance associated to the growth of global saving
and the need to improve risk-return trade-offs)
Growth of International Trade


the same period. Since 1970 trade growth accelerated, with commercial flows expanding by a
factor of 35 times.

allowed the mechanisms of comparative and competitive advantages to operate in full.


export activity; the exchange of national currencies with foreign currencies; the need to cover
against exchange rate risk and/or the country risk; the need to finance commercial trade deficits.
Increased importance of MCE
The UN estimates that there are more than 35,000 multinational corporations, with the largest 100 of
these possibily being responsible for approximately 16% of the world‗s productive assets.
MCE are responsible for FDIs (Foreign Direct Investment), which means producing directly abroad
(instead of exporting in a foreign country).
FDI is an hybrid between a real and a financial flow. Foreign direct investment reflect the objective of
obtaining a lasting interest by a resident entity in one economy (‗‗direct investor‗‗) in an entity resident
in an economy other than that of the investor (‗‗direct investment enterprise‗‗). The lasting interest
implies a significant degree of influence on the management of the (direct investment)
enterprise (the OECD definition: 10% of the ordinary shares or the voting power).
World's largest corporations, 2011
Growth of Multinational Banking
374
Through the opening of representative offices, agencies, and branches and through the acquisition or
establishment of subsidiaries, banking has become a truly multinational business.
In the US more than 500 foreign banks had offices in 2004. By 2007, foreign banks owned 24% of total
US banking assets. In most countries domestic and foreign banks compete normally on the market for
deposits and loans. In order to protect the domestic banks, countries may put restrictions to the entry of
foreign banks.
Factors behind Multinational Banking

Beyond those factors that contribute to the internationalization of business in general, there are specific
factors that apply to banking.
1. Market information. To get useful and timely information on how markets develop the best is to
operate locally.
2. Borrower information. To better assess the creditworthiness of your clients, the best is to get ‗fresh‗
information on the spot and have regular contacts with your borrowers.
3. Serving clients. If your clients invest internationally, it may be best to ‗follow‗ them in the foreign
market and support their operations directly (not through a correspondent), otherwise you risk that
your clients go to local banks.
4. Custodial services. Obtaining by clients the custody of stocks and bonds require physical proximity.
5. Avoiding regulation. Banks are the most regulated sector of the economy in every part of the world.
By operating internationally banks try to avoid or soften regulation (reserve requirements, deposit
insurance, reporting requirements, interest-rate ceilings, etc.)
How big are multinational banks
The Eurodollar Market

 -by-side in just about every financial center. In
London you can open a bank deposit in € (a foreign currency in the UK) and obtain a loan in
US$.
 posit is a US dollar-denominated bank deposit outside the US.

country of origin of the currency.
375
 ore currency market but it is certainly very

big! As for domestic banking, offshore deposits may give rise to multiplier effect that raise the
supply of global liquidity.
Factors behind the Growth of the Eurodollar Market:
 - Soviet Union $ deposits in British and French Banks, which were preferred to
US banks by the soviets.
 - Regulation Q put limitations on interest rates that US banks could pay
on deposits. It became more convenient to deposit $ in banks outside the US, especially in
Europe. Most US banks decided to open branches in the old continent.

for offshore operations.
 tax on US loans to foreigners, which made convenient to
get loans on the eurodollar market to avoid the tax.

 tributed to the growth of the offshore
market for other currencies
Growth of cross border financial flows:
Parallel to trade, in the world war period and especially after the 70s there has been an enormous growth
in cross border financial flows of all kinds: foreign investment in the money market (e.g. interbank
market), the bond market, the stock market and the real estate market.
The importance of foreign investment may overshadow that of domestic investments and investors (for
instance the role of foreign investors is of crucial importance for the successful sales of US Treasury bills
as well as Italian BOTs)
There has been an explosion of internationally oriented financial products such as mutual funds, which
can be globally or regionally diversified or focused on a single foreign country market.
Fig. 1.1 Since the mid-70s Americans have increased their investments abroad by more than 10 times
while non-US investors have increased their interest in US assets by 20 times.
The US moved from being the largets net creditor to the largest net debtor in only a quarter of a century.
376
Both advanced, emerging and developing economies are nowadays strictly dependent on foreign
financing
Benefits from international investment
 arch for higher returns abroad (for instance investing in
emerging market stocks and bonds) and better diversify risk than he could do by investing his
savings only domestically.
 the advanced
economies), where returns are low, to the low saving ones where returns are normally higher

(when national income is low and hence consumption is low, one can use foreign capital to keep
consumptionconstant)

Financial Instability
Financial instability is the ‗dark side‗ of international finance. It may consist of: excess volatility of
exchange rates (especially amongst major currencies) which can be
disruptive for trade and financial flows; excess volatility in stock and bond markets, which makes difficult
to evaluate investments; excess instability of financial flows, which can move from one country to
another massively and with extreme rapidity giving rise to bubbles or financial crises having real
economic consequences.
Financial crises
In recent years heavily disruptive financial crises have dominated the scene of global finance and put into
question the benefits from financial globalization.
1982 Latin American Debt Crisis

1992 ERM crisis
1994 Mexican crisis
1997 Asian Crisis
1998 Russian Crisis
2000/01 New Economy Bubble Burst
2001 Argentina‗s financial crisis
The Great Crisis 2007-2010
377
Greece and the Euro Crisis 2011-2012
4.2.2 The World Band
The World Bank grew out of the Bretton Woods Conference held in 1944 in the wake of World
War II.
Early History and Administrative Structure
In 1943, U.S. Treasury Secretary Henry Morgenthau proposed via memorandum a ―United
Nations Bank for Reconstruction and Development.‖ As in the case of the U.S. proposal for the
IMF discussed in previously, U.S. Treasury official Harry Dexter White was the main author.
Some months later, in 1944, the British briefly responded to this proposal, and the two countries
entered into the Bretton Woods conference in July of that year ready to discuss the creation of
such a Bank. The Bretton Woods conference initially focused on the IMF, but in response to the
concerns of countries damaged by the war, as well as of developing countries, a group was
finally constituted to work on the Bank under the supervision of John Maynard Keynes.
The discussion at Bretton Woods focused on the relative roles of post-war reconstruction
(emphasized by the European countries) and economic development (emphasized by the
developing countries). The ensuing Articles of Agreement of the International Bank for
Reconstruction and Development (IBRD) left room for both activities, although, as we shall see,
attention was first given to reconstruction. The IBRD was the first of five components of what
was later to be called the World Bank Group.
The Purpose of the World Bank
The purposes of the World Bank, as stated in Article 1 of the original (Bretton Woods) Articles
of Agreement, are:
1. To assist in the reconstruction and development of territories of members by facilitating the
nvestment of capital for productive purposes, including the restoration of economies
destroyed or disrupted by war, the reconversion of productive facilities to peacetime needs
and the encouragement of the development of productive facilities and resources in less
developed countries.
378
2. To promote private foreign investment by means of guarantees or participations in loans and

other investments made by private investors; and when private capital is not available on
reasonable terms, to supplement private investment by providing, on suitable conditions,
finance for productive purposes out of its own capital, funds raised by it and its other
resources.
3. To promote the long-range balanced growth of international trade and the maintenance of
equilibrium in balances of payments by encouraging international investment for the
development of the productive resources of members, thereby assisting in raising
productivity, the standard of living and conditions of labor in their territories. The World
Bank has a capital stock subscribed by its member countries and divided into shares.
4. To arrange the loans made or guaranteed by it in relation to international loans through other
channels so that the more useful and urgent projects, large and small alike, will be dealt with
first.
5. To conduct its operations with due regard to the effect of international investment on
business conditions in the territories of members and, in the immediate postwar years, to
assist in bringing about a smooth transition from a wartime to a peacetime economy.
The World Bank has a capital stock subscribed by its member countries and divided into
shares.
The World Bank Group comprises five constituent institutions: the International Bank for
Reconstruction and Development (IBRD), the International Development Association (IDA), the
International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency
(MIGA), and the International Centre for Settlement of Investment Disputes (ICSID). The IBRD
provides loans at market rates of interest to middle-income developing countries and
creditworthy lower-income countries. The IDA, founded in 1960, provides interest-free longterm loans,
technical assistance, and policy advice to low-income developing countries in areas
such as health, education, and rural development. Whereas the IBRD raises most of its funds on
the world‗s capital markets, the IDA‗s lending operations are financed through contributions
from developed countries. The IFC, operating in partnership with private investors, provides
loans and loan guarantees and equity financing to business undertakings in developing countries.
Loan guarantees and insurance to foreign investors against loss caused by noncommercial risks
in developing countries are provided by the MIGA. The purpose of MIGA is to encourage the
flow of FDI to developing countries. To support this aim, MIGA engages in three kinds of
379
activities. First, it issues guarantees against noncommercial risks in recipient member countries.
Specifically, MIGA insures against transfer restriction, expropriation, breach of contract, and
war and civil disturbance. Second, it engages in investment marketing through capacity building,
information dissemination, and investment facilitation. Third, it provides a host of legal services
to World Bank member countries to support FDI. In this last function, MIGA engages in
activities somewhat similar to that of the Finally, the ICSID, which operates independently of the
IBRD, is responsible for the settlement by conciliation or arbitration of investment disputes
between foreign investors and their host developing countries.
The Components of the World Bank Group

IBRD membership is confined to countries that are already members of the IMF. Therefore, IMF
membership is a prerequisite for IBRD membership. The capital stock of the Bank is based on
members‗ subscription shares, which, in turn, are based on the members‗ quotas in the IMF. On
joining the Bank, a member pays 10 percent of its subscription. The remaining 90 percent is
―callable‖ by the Bank. The funds from which the Bank makes loans come from a number of
sources: members‗ subscription shares, retained earnings on investments, bond issues, and loan
repayments. The main source of funds, however, is bond issues. IBRD bonds achieved a ―triple
A‖ rating in the mid-1950s and have held this rating ever since.
Organization
The World Bank is related to the UN, though it is not accountable either to the General
Assembly or to the Security Council. Each of the bank‗s more than 180 member states are
represented on the board of governors, which meets once a year. The governors are usually their
countries‗ finance ministers or central bank governors. Although the board of governors has
some influence on IBRD policies, actual decision-making power is wielded largely by the bank‗s
25 executive directors. The Executive Board conducts the day -to-day business of the Bank. The
President chairs the Executive Board and is ultimately subject to its control.
Five major countries—the United States, Japan, Germany, the United Kingdom, and France—
appoint their own executive directors. The other countries are grouped into regions, each of
which elects one executive director. Throughout the World Bank‗s history, the bank president,
who serves as chairman of the Executive Board, has been an American citizen.
The World Bank has a plethora of Vice Presidents. These are structured around regions (Africa,
East Asia and Pacific, Europe and Central Asia, Latin America and the Caribbean, Middle East
and North Africa, South Asia), networks (financial and private sector development, human
380
development, operations policy and country services, poverty reduction and economic
management, and sustainable development), and a host of functions (e.g., external relations and
development economics).
The World Bank is staffed by more than 10,000 people, roughly one-fourth of whom are posted
in developing countries. The bank has more than 100 offices in member countries, and in many
countries staff members serve directly as policy advisers to the ministry of finance and other
ministries. The bank has consultative as well as informal ties with the world‗s financial markets
and institutions and maintains links with nongovernmental organizations in both developed and
developing countries.
Voting power is based on a country‗s capital subscription, which is based in turn on its economic
resources. The wealthier and more developed countries constitute the bank‗s major shareholders
and thus exercise greater power and influence. For example, in the early 21st century the United
States exercised nearly one-sixth of the votes in the IBRD, more than double that of Japan, the
second largest contributor. Because developing countries hold only a small number of votes, the
system does not provide a significant voice for these countries, which are the primary recipients
of World Bank loans and policy advice.
The bank obtains its funds from the capital subscriptions of member countries, bond flotations on
the world‗s capital markets, and net earnings accrued from interest payments on IBRD and IFC
loans. Approximately one-tenth of the subscribed capital is paid directly to the bank, with the
remainder subject to call if required to meet obligations.
Infrastructure Project Lending and Poverty Alleviation Phases

In its early years, the IBRD directed its efforts toward large-scale infrastructure projects. This
could be called its infrastructure project lending phase. The projects funded by the Bank included
ports, railways, flood-control, power plants, roads, telecommunications facilities, and dams.
Additionally, project lending was often accompanied by ―program lending‖ (or ―nonproject
lending‖), which helped to finance the importation of intermediate products necessary for
infrastructure projects. Missing, however, was any significant lending in the social realm, such as
for education, health, agricultural development, or urban planning. Some observers attributed
this lack of attention to the social realm to a belief that large-scale infrastructure was a
381
prerequisite for development, whereas others attributed it to a reluctance to disturb the capital
markets with social-realm lending and, thereby, compromise the Bank‗s triple-A rating. There
was also the observation on the part of the Bank that the large capital investments would be
unlikely to be made by private capital, so the Bank should fill in the gap.
The project-lending phase of the Bank‗s operations was tempered to some extent in the 1960s.
Subsequent to severe droughts in South Asia, the Bank began to pay more attention to agriculture
in cooperation with the United Nations Food and Agriculture Organization (FAO). It even began
to venture into education in cooperation with the United Nations Educational, Scientific and
Cultural Organization (UNESCO).
Nevertheless, ―between fiscal years 1961 and 1965, 76.8 percent of all Bank lending was for
electric power or transportation. Only 6 percent was for agricultural development, and a paltry 1
percent for social service investment‖ (Ayres, 1983, pp. 2–3). In 1968, Robert McNamara took
over as World Bank President, a position he held until 1981. The McNamara presidency
coincided with a second phase for the World Bank, one we can call the poverty alleviation phase.
McNamara gave a now-famous speech at the 1973 Board of Governors meeting in Kenya on this
topic. The poverty alleviation phase was characterized by a focus on the eradication of absolute
poverty (defined in terms of minimum incomes) through rural and urban development.
Within the Bank, these new ideas were operationalized via the concept of redistribution with
growth. This idea called for the harnessing of new sources of income to help the poor. It avoided
any redistribution of existing incomes and assets. For example, World Bank projects did not
address inequitable patterns of land ownership. In this sense, it was quite conservative and, in
instances where asset redistribution was crucial to development, ineffectual.
In an important way, the redistribution with growth concept has persisted at the Bank to the
present, although now it is called pro-poor growth. For example, the World Bank used the
concept of shared growth to analyze East Asian economies (World Bank, 1993). And in this
case, too, it ignored the important role of asset distribution in the form of land and human capital
in explaining East Asian success. Nevertheless, at the time, the redistribution with growth
concept did significantly affect patterns of Bank lending.
During the poverty alleviation phase, lending increased dramatically. World Bank staff
increased, as did the proportion of the staff from developing countries. Subscription capital
increased to $27 billion in 1971. Perhaps most importantly, especially after 1973, lending was
channeled in new directions. Agriculture and rural development, education, health, and urban
382
development all took on increasing importance, and none of these changes appeared to hurt the
financial position of the Bank vis-a-vis the capital markets.
`
In the case of rural development, the notion of ―projects‖ changed, moving toward what was
called integrated rural development. Integrated rural development involved constellations of
activities focused on targeted regions of member countries. These activities included agricultural
credit, roads, agricultural support services, irrigation, rural education, agricultural research and
extension, and social services such as health clinics. The goal was to increase the productivity of
the rural poor, but the targeted population was the small-scale, owner-operator farmer. Lending
for integrated rural development had beneficial effects on these smallscale farmers, but ignored
those who became known as ―the poorest of the poor,‖ namely, the rural landless agricultural
workers.
Despite some limitations to alleviating absolute poverty among the landless, the integrated rural
development strategy was a significant change from Bank agricultural lending under the
infrastructure project-lending phase, which had primarily benefited the owners of large farms. To
some development policy analysts (e.g., Paarlberg and Lipton, 1991), it is a strategy
unfortunately absent from subsequent Bank lending. Indeed, Bank lending in the area of
agriculture fell from approximately 20 percent of total lending in 1986 to only 4 percent in 2001,
rising to just over 7 percent in 2007. That said, the Bank subsequently did take some interest in
land redistribution issues, as discussed in the accompanying box.
Under its poverty alleviation phase, the Bank also began to recognize the growing importance of
urban areas in developing countries and, consequently, began to focus on urban poverty. The
important areas of lending were affordable housing for the poor, small-scale enterprises, water
supply, sewerage, transportation, and community services (e.g., health clinics and schools). The
Bank has maintained an active loan portfolio in urban development up to the present, with
poverty alleviation being one of many thematic areas within this lending category.
Policy-based lending
The third phase of Bank lending involved structural adjustment lending and policy
conditionality. Structural adjustment lending (SAL) began in 1980 under McNamara‗s
presidency. It involved nonproject lending to support adjustment in the face of balance of
payments and other macroeconomic difficulties. In the words of an early SAL advocate:
Structural adjustment lending is intended to assist governments to adopt necessary, though often
383
politically difficult, policy and institutional reforms designed to improve the efficiency of
resource use. By focusing on the policy and institutional reforms required to correct distortions
in the pattern of incentives and to adapt each economy to the changed international price
structure and trading opportunities, structural adjustment lending also helps create a more
appropriate environment for the Bank‗s project lending. In this way, the two forms of assistance
are complementary, not alternatives. (Stern, 1983, p. 89)
The Bank‗s SAL became controversial for a number of reasons. First, SAL began to encroach
on the work of the IMF. Some argued that, in contrast to the IMF‗s fundamentally short-term
and macroeconomic focus, the Bank‗s SAL had a medium-term and microeconomic focus.
Others argued that this was too simplistic and that the real issue was in the different capabilities
of the two institutions. The potential for conflict between the two Bretton Woods institutions
came to a head in 1988. The Bank approved a large SAL package to Argentina in the absence of
an agreement between this country and the IMF. This conflict led to a concordat or joint
memorandum in 1989 delineating Bank and Fund roles.
The second controversy over SAL related to bargaining over conditionality. Conditionality
ties Bank lending to prescribed policy changes on the part of the recipient government. In
actuality, World Bank loans always carried conditions. The change that occurred in the 1980s
was that these conditions were broadened from the sectoral level to the macroeconomic level.
The IMF also imposes conditions on its loans. In contrast to IMF conditionality, Bank
conditionality tends to be substantially more extensive. There were valid claims that the Bank
demonstrated an inability to set priorities in its conditionality, with some loan agreements
involving a hundred or more conditions. There also arose the time-inconsistency problem, in
which loans were delivered based on conditionality pledges that were later not honored, leading
to a complex, repeated bargaining game between the Bank and borrowing countries.
Some observers have alleged that those countries in greatest need of SAL support were in the
weakest bargaining position vis-a-vis the Bank and, therefore, accepted the ` greatest amount of
requisite policy changes. However, the countries in greatest need of SAL were not necessarily
those with the greatest need of policy reform because the need for support can be set off by
changes in global economic conditions (e.g., export price declines) rather than by bad policies.
Consequently, policy reform can be concentrated where it is not really needed. There was the
related issue of donor capture of the process, particularly in the case of the United States. For
384
example, Kilby (2009) has presented evidence that conditionality has been imposed most
strongly on recipient countries not aligned with the United States on foreign policy issues.
A third concern was that the growth of SAL has come at the expense of rural development
(e.g., Paarlberg and Lipton, 1991). An often-quoted fact is that approximately three-fourths of
the world‗s poor people reside in rural areas. However, as mentioned above, during the SAL era,
there was a decline in Bank lending for rural development. Consequently, the Bank‗s expertise
and staffing in the areas of agriculture and rural development diminished. Ironically, the 2008
World Development Report of the Bank concluded that the rural sector was crucial for poverty
alleviation. But as a result of the previous decades of neglect, the Bank was not in a position to
do much about this.
A final criticism of the SAL program was that it tended to hurt the poor. This argument was
bolstered by research sponsored by the United Nations Children‗s Fund (UNICEF) calling for
―adjustment with a human face‖ or an attempt to offset adjustment‗s effects on the poor.As a
result of these and other critiques, the Bank began to pay attention to the effect of SAL and
conditionality on the poor. Nevertheless, it would be an understatement to say that the two sides
of this debate tended to talk past one another.
During the 1980s, the policy thinking of the Bank and Fund began to converge to a common set
of conditions. As described in the accompanying box, these policy components became known in
economic and international policy communities as the Washington Consensus. The Washington
Consensus became intimately associated with the policy-based lending phase of the Bank and
has been the subject of a great deal of controversy over its appropriateness that continues to this
day.
The policy-based lending phase of the Bank was tempered by subsequent events, but never fully
disappeared. From 1988 to 2005, the average number of conditions on Bank loans declined from
approximately 55 to 10, but adjustment lending has continued to comprise approximately 30
percent of Bank lending since 2000. That said, significant changes did occur with the 1995–2005
Wolfensohn presidency, discussed later.
Good Luck in Your Exams!

385

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Wuba Lem

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MATERIALS FOR EXIT EXAM 2023 (2015 E.

The 15 Selectede Courses of the Department of Governance and

Contributed by All Universities Concerned

Re-compiled by: Exam Developers

The Rationale to re-compiling in a single document:

 Reducing the confussins over identifying the materials prepared by

COURSE 2: GENDER AND DEVELOPMENT ............................................................................. 41

COURSE 3: REGIONAL GROWTH AND LOCAL DEVELOPMENT ....................................... 86

COURSE 4: CONFLICT MANAGEMENT AND PEACE BUILDING....................................... 153

COURSE 5: INTERNATIONAL RELATION AND ORGANIZATION ..................................... 205

COURSE 6: POLITICAL SYSTEMS AND GOVERNANCE IN ETHIOPIAN .......................... 267

COURSE 7: INTRODUCTION TO POLITICS AND GOVERNMENT ...................................... 362

COURSE 8: POLITICAL THOUGHT II ....................................................................................... 453

COURSE 9: PUBLIC POLICY MAKING AND ANALYSIS ...................................................... 536

COURSE 10: THEORIES AND PRACTICES OF GOVERNANCE ........................................... 635

COURSE 11: GOVERNANCE AND INSTITUTIONAL REFORM............................................ 770

COURSE 12: INTRODUCTION TO PUBLIC ADMINISTRATION .......................................... 121

COURSE 14: DEVELOPMENT THEORIES AND PRACTICES................................................ 139

COURSE 15: INTERNATIONAL POLITICAL ECONOMY (IPE) ............................................. 217

Cocepts of Population Studies

1.1. Demography versus Population Studies

1.2.1. The growth of Development Studies

1.2.2. The Growth of Population Studies

1.3. The Sources of Demographic Information

1.3.1. National Censuses

What advantages come from registering vital events?

World Fertility Surveys

2.2 Population Growth and Environment

2.3 Health and Development

2.3.1 Effects of Health on Development

2.3.2. Measures (Indicators) Of Development

Approaches to Measure GNP

How Good Is GNP /Capita As A Measure Of Development?

 Adjust GNP or GNP growth for income distribution in the country.

Social Indicators Of Development Include:

 Primary school enrolment (as % of population aged 5-14).

3.4. Health Indicators and GNP

Infrastructure and Organization

3.1. Definition of Population Policy

 Population policy may be defined as deliberately constructed or modified institutional

3.2. Types of Population Policy

Population Policy: Antinatalist

3.3. Global Population Policy

 At Bucharest ideology/ideas/beliefs/philosophy dominated the proceedings. The financial

3.5. The National Population Policy of Ethiopia

3.5.2. Goals, Objectives and Strategies of the Population Policy

d) Maintaining/improving the carrying capacity of the environment by taking appropriate

c) Significantly increasing female participation at all levels of the educational system;

f) Ensuring spatially balanced population distribution patterns with a view to maintaining

h) Mounting an effective country wide population information and education programme

? Mention the rationale for the population policy of Ethiopia. _________

3.5.3. Major Areas of Population Activities Requiring Priority Attention

3.6. Factors Affecting Population Policies

SUSTAINABLE DEVELOPMENT AND NATURAL RESOURCE IN

So is it all just about the environment?

How does it affect me?

How do we make it happen?

4.1 The four pillars of sustainability

4.1.1 Human sustainability

4.1.2 Social sustainability

4.1.3 Economic sustainability

4.1.4 Environmental sustainability

4.2 The five principles of sustainable development are as follows:

1. Conservation of the ecosystem or the environment.